AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON SEPTEMBER 6, 2016

Registration No. 333-207560

 

 

 

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

 

 

Amendment No. 7

to

Form S-1

REGISTRATION STATEMENT

UNDER

THE SECURITIES ACT OF 1933

 

 

NOBLE MIDSTREAM PARTNERS LP

(Exact Name of Registrant as Specified in Its Charter)

 

 

 

Delaware   4932   47-3011449

(State or Other Jurisdiction of

Incorporation or Organization)

 

(Primary Standard Industrial

Classification Code Number)

 

(I.R.S. Employer

Identification Number)

1001 Noble Energy Way

Houston, Texas 77070

(281) 872-3100

(Address, including Zip Code, and Telephone Number, including Area Code, of Registrant’s Principal Executive Offices)

 

 

John F. Bookout, IV

Chief Financial Officer

1001 Noble Energy Way

Houston, Texas 77070

(281) 872-3100

(Name, Address, including Zip Code, and Telephone Number, including Area Code, of Agent for Service)

 

 

Copies to:

 

G. Michael O’Leary

George Vlahakos

Andrews Kurth LLP

600 Travis, Suite 4200

Houston, Texas 77002

(713) 220-4200

 

Douglas E. McWilliams

Julian J. Seiguer

Vinson & Elkins L.L.P.

1001 Fannin St., Suite 2500

Houston, Texas 77002

(713) 758-2222

 

 

Approximate date of commencement of proposed sale to the public: As soon as practicable after this Registration Statement becomes effective.

If any of the securities being registered on this form are to be offered on a delayed or continuous basis pursuant to Rule 415 under the Securities Act of 1933, check the following box.   ¨

If this Form is filed to register additional securities for an offering pursuant to Rule 462(b) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering.   ¨

If this Form is a post-effective amendment filed pursuant to Rule 462(c) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering.   ¨

If this Form is a post-effective amendment filed pursuant to Rule 462(d) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering.   ¨

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See the definitions of “large accelerated filer,” “accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act. (Check one):

 

Large accelerated filer   ¨    Accelerated filer   ¨                   
Non-accelerated filer   x  (Do not check if a smaller reporting company)    Smaller reporting company   ¨

 

 

 


Explanatory Note

This Amendment No. 7 to the Registration Statement on Form S-1 (File No. 333-207560) of Noble Midstream Partners LP is being filed solely to amend Item 16 of Part II thereof and to transmit certain exhibits thereto. This Amendment No. 7 does not modify any provision of the preliminary prospectus contained in Part I or Items 13, 14, 15 or 17 of Part II of the Registration Statement. Accordingly, this Amendment No. 7 does not include a copy of the preliminary prospectus.


Part II

Information Not Required in Prospectus

Item 13. Other Expenses of Issuance and Distribution

Set forth below are the expenses (other than underwriting discounts and commissions and the structuring fee) expected to be incurred in connection with the issuance and distribution of the securities registered hereby. With the exception of the SEC registration fee, the FINRA filing fee and the NYSE listing fee, the amounts set forth below are estimates.

 

SEC registration fee

   $ 30,400   

FINRA filing fee

     45,800   

NYSE listing fee

     125,000   

Printing and engraving expenses

     800,000   

Fees and expenses of legal counsel

     1,300,000   

Accounting fees and expenses

     700,000   

Transfer agent and registrar fees

     6,500   

Miscellaneous

     42,300   
  

 

 

 

Total

   $ 3,050,000   
  

 

 

 

Item 14. Indemnification of Directors and Officers

The section of the prospectus entitled “Our Partnership Agreement—Indemnification” discloses that we will generally indemnify officers, directors and affiliates of the general partner to the fullest extent permitted by the law against all losses, claims, damages or similar events and is incorporated herein by this reference. Reference is also made to the underwriting agreement to be filed as an exhibit to this registration statement in which Noble Midstream Partners LP and certain of its affiliates will agree to indemnify the underwriters against certain liabilities, including liabilities under the Securities Act, and to contribute to payments that may be required to be made in respect of these liabilities. Subject to any terms, conditions or restrictions set forth in the partnership agreement, Section 17-108 of the Delaware Act empowers a Delaware limited partnership to indemnify and hold harmless any partner or other persons from and against all claims and demands whatsoever. Noble has purchased insurance covering the general partner’s officers and directors against liabilities asserted and expenses incurred in connection with their activities as officers and directors of the general partner or any of its direct or indirect subsidiaries.

Item 15. Recent Sales of Unregistered Securities

On December 23, 2014, in connection with the formation of the partnership, Noble Midstream Partners LP issued to Noble Midstream GP LLC a 1% general partner interest in the partnership for $20.00 and a 99% limited partner interest in the partnership for $980.00 in an offering exempt from registration under Section 4(2) of the Securities Act. There have been no other sales of unregistered securities within the past three years.

 

II-1


Item 16. Exhibits

The following documents are filed as exhibits to this registration statement:

 

Exhibit
number

  

Description

  1.1*    Form of Underwriting Agreement (including form of Lock-Up Agreement) (previously filed as Exhibit 1.1 to Amendment No. 5 to the Noble Midstream Partners LP Registration Statement on Form S-1 (333-207560) filed on July 22, 2016)
  3.1*    Certificate of Limited Partnership of Noble Midstream Partners LP (previously filed as Exhibit 3.1 to the Noble Midstream Partners LP Registration Statement on Form S-1 (333-207560) filed on October 22, 2015)
  3.2*    Amendment to the Certificate of Limited Partnership of Noble Midstream Partners LP (previously filed as Exhibit 3.2 to the Noble Midstream Partners LP Registration Statement on Form S-1 (333-207560) filed on October 22, 2015)
  3.3*   

Amendment to the Certificate of Limited Partnership of Noble Midstream Partners LP

(previously filed as Exhibit 3.3 to Amendment No. 1 to the Noble Midstream Partners LP Registration Statement on Form S-1 (333-207560) filed on November 6, 2015)

  3.4    Form of First Amended and Restated Agreement of Limited Partnership of Noble Midstream Partners LP (included as Appendix A to the Prospectus)
  3.5*    Certificate of Formation of Noble Midstream GP LLC (previously filed as Exhibit 3.4 to the Noble Midstream Partners LP Registration Statement on Form S-1 (333-207560) filed on October 22, 2015)
  3.6*    Amendment to Certificate of Formation of Noble Midstream GP LLC (previously filed as Exhibit 3.5 to the Noble Midstream Partners LP Registration Statement on Form S-1 (333-207560) filed on October 22, 2015)
  3.7*    Form of First Amended and Restated Limited Liability Company Agreement of Noble Midstream GP LLC (previously filed as Exhibit 3.7 to Amendment No. 1 to the Noble Midstream Partners LP Registration Statement on Form S-1 (333-207560) filed on November 6, 2015)
  5.1*    Opinion of Andrews Kurth LLP as to the legality of the securities being registered (previously filed as Exhibit 5.1 to Amendment No. 2 to the Noble Midstream Partners LP Registration Statement on Form S-1 (333-207560) filed on November 12, 2015)
  8.1*    Opinion of Andrews Kurth LLP relating to tax matters (previously filed as Exhibit 8.1 to Amendment No. 2 to the Noble Midstream Partners LP Registration Statement on Form S-1 (333-207560) filed on November 12, 2015)
10.1    Form of Contribution, Conveyance and Assumption Agreement
10.2#*    Form of Noble Midstream Partners LP 2016 Long-Term Incentive Plan (previously filed as Exhibit 10.2 to Amendment No. 1 to the Noble Midstream Partners LP Registration Statement on Form S-1 (333-207560) filed on November 6, 2015)
10.3    Form of Omnibus Agreement
10.4*   

Form of Operational Services and Secondment Agreement (previously filed as Exhibit 10.4 to Amendment No. 5 to the Noble Midstream Partners LP Registration Statement on Form S-1

(333-207560) filed on July 22, 2016)

10.5    Form of Credit Agreement
10.6*    Second Amended and Restated Agreement Terms and Conditions Relating to Gas Gathering Services (previously filed as Exhibit 10.6 to Amendment No. 5 to the Noble Midstream Partners LP Registration Statement on Form S-1 (333-207560) filed on July 22, 2016)

 

II-2


Exhibit
number

  

Description

10.7†*    Amended and Restated Gas Gathering Agreement, Agreement Addendum 01, effective as of October 1, 2015, among Noble Energy, Inc., Noble Midstream Services, LLC and Colorado River DevCo LP (previously filed as Exhibit 10.7 to the Noble Midstream Partners LP Registration Statement on Form S-1 (333-207560) filed on October 22, 2015)
10.7.1†*    Second Amended and Restated Gas Gathering Agreement, Agreement Addendum 01, effective as of March 31, 2016, among Noble Energy, Inc. and Colorado River DevCo LP (previously filed as Exhibit 10.7.1 to Amendment No. 5 to the Noble Midstream Partners LP Registration Statement on Form S-1 (333-207560) filed on July 22, 2016)
10.7.2    Amendment 01 to that certain Second Amended and Restated Gas Gathering Agreement, together with Agreement Addendum 01, effective as of September 1, 2016, among Noble Energy, Inc. and Colorado River DevCo LP
10.8*    Amended and Restated Gas Gathering Agreement, Agreement Addendum 03, effective as of October 1, 2015, among Noble Energy, Inc., Noble Midstream Services, LLC and Green River DevCo LP (previously filed as Exhibit 10.8 to the Noble Midstream Partners LP Registration Statement on Form S-1 (333-207560) filed on October 22, 2015)
10.8.1†*    Second Amended and Restated Gas Gathering Agreement, Agreement Addendum 03, effective as of March 31, 2016, among Noble Energy, Inc. and Green River DevCo LP (previously filed as Exhibit 10.8.1 to Amendment No. 5 to the Noble Midstream Partners LP Registration Statement on Form S-1 (333-207560) filed on July 22, 2016)
10.8.1.1    Amendment 01 to that certain Second Amended and Restated Gas Gathering Agreement, together with Agreement Addendum 03, effective as of September 1, 2016, among Noble Energy, Inc. and Green River DevCo LP
10.8.2*    Second Amended and Restated Gas Gathering Agreement, Agreement Addendum XX, effective as of March 31, 2016, among Noble Energy, Inc. and Noble Midstream Services, LLC (previously filed as Exhibit 10.8.2 to Amendment No. 5 to the Noble Midstream Partners LP Registration Statement on Form S-1 (333-207560) filed on July 22, 2016)
10.9    Third Amended and Restated Agreement Terms and Conditions Relating to Crude Oil Treating Services
10.10†*    Second Amended and Restated Crude Oil Treating Agreement, Agreement Addendum 01, effective as of October 1, 2015, among Noble Energy, Inc., Noble Midstream Services, LLC and Colorado River DevCo LP (previously filed as Exhibit 10.10 to the Noble Midstream Partners LP Registration Statement on Form S-1 (333-207560) filed on October 22, 2015)
10.10.1†    Third Amended and Restated Crude Oil Treating Agreement, Agreement Addendum 01, effective as of March 31, 2016, among Noble Energy, Inc. and Colorado River DevCo LP
10.10.2†    Third Amended and Restated Crude Oil Treating Agreement, Agreement Addendum 02, effective as of March 31, 2016, among Noble Energy, Inc. and Colorado River DevCo LP
10.11*    Second Amended and Restated Agreement Terms and Conditions Relating to Produced Water Services (previously filed as Exhibit 10.11 to Amendment No. 5 to the Noble Midstream Partners LP Registration Statement on Form S-1 (333-207560) filed on July 22, 2016)
10.12†*    Amended and Restated Produced Water Services Agreement, Agreement Addendum 01, effective as of October 1, 2015, among Noble Energy, Inc., Noble Midstream Services, LLC and Colorado River DevCo LP (previously filed as Exhibit 10.12 to the Noble Midstream Partners LP Registration Statement on Form S-1 (333-207560) filed on October 22, 2015)

 

II-3


Exhibit
number

  

Description

10.12.1†*    Amendment 01 to Amended and Restated Produced Water Services Agreement, Agreement Addendum 01, effective as of January 1, 2016, among Noble Energy, Inc., Noble Midstream Services, LLC and Colorado River DevCo LP (previously filed as Exhibit 10.12.1 to Amendment No. 3 to the Noble Midstream Partners LP Registration Statement on Form S-1 (333-207560) filed on April 1, 2016)
10.12.2†*   

Second Amended and Restated Produced Water Services Agreement, Agreement Addendum 01,

effective as of March 31, 2016, among Noble Energy, Inc. and Colorado River DevCo LP (previously filed as Exhibit 10.12.2 to Amendment No. 5 to the Noble Midstream Partners LP Registration Statement on Form S-1 (333-207560) filed on July 22, 2016)

10.12.3    Amendment 01 to that certain Second Amended and Restated Produced Water Services Agreement, together with Agreement Addendum 01, effective as of September 1, 2016, among Noble Energy, Inc. and Colorado River DevCo LP
10.13†*    Amended and Restated Produced Water Services Agreement, Agreement Addendum 02, effective as of October 1, 2015, among Noble Energy, Inc., Noble Midstream Services, LLC and San Juan River DevCo LP (previously filed as Exhibit 10.13 to the Noble Midstream Partners LP Registration Statement on Form S-1 (333-207560) filed on October 22, 2015)
10.13.1†*    Second Amended and Restated Produced Water Services Agreement, Agreement Addendum 02, effective as of March 31, 2016, among Noble Energy, Inc. and San Juan River DevCo LP (previously filed as Exhibit 10.13.1 to Amendment No. 5 to the Noble Midstream Partners LP Registration Statement on Form S-1 (333-207560) filed on July 22, 2016)
10.13.2    Amendment 01 to that certain Second Amended and Restated Produced Water Services Agreement, together with Agreement Addendum 02, effective as of September 1, 2016, among Noble Energy, Inc. and San Juan River DevCo LP
10.14*    Amended and Restated Produced Water Services Agreement, Agreement Addendum 03, effective as of October 1, 2015, among Noble Energy, Inc., Noble Midstream Services, LLC and Green River DevCo LP (previously filed as Exhibit 10.14 to the Noble Midstream Partners LP Registration Statement on Form S-1 (333-207560) filed on October 22, 2015)
10.14.1*    Second Amended and Restated Produced Water Services Agreement, Agreement Addendum 03, effective as of March 31, 2016, among Noble Energy, Inc. and Green River DevCo LP (previously filed as Exhibit 10.14.1 to Amendment No. 5 to the Noble Midstream Partners LP Registration Statement on Form S-1 (333-207560) filed on July 22, 2016)
10.14.2    Amendment 01 to that certain Second Amended and Restated Produced Water Services Agreement, together with Agreement Addendum 03, effective as of September 1, 2016, among Noble Energy, Inc. and Green River DevCo LP
10.15*    Amended and Restated Produced Water Services Agreement, Agreement Addendum 04, effective as of October 1, 2015, among Noble Energy, Inc., Noble Midstream Services, LLC and Gunnison River DevCo LP (previously filed as Exhibit 10.15 to the Noble Midstream Partners LP Registration Statement on Form S-1 (333-207560) filed on October 22, 2015)
10.15.1*    Second Amended and Restated Produced Water Services Agreement, Agreement Addendum 04, effective as of March 31, 2016, among Noble Energy, Inc. and Gunnison River DevCo LP (previously filed as Exhibit 10.15.1 to Amendment No. 5 to the Noble Midstream Partners LP Registration Statement on Form S-1 (333-207560) filed on July 22, 2016)
10.15.2    Amendment 01 to that certain Second Amended and Restated Produced Water Services Agreement, together with Agreement Addendum 04, effective as of September 1, 2016, among Noble Energy, Inc. and Gunnison River DevCo LP

 

II-4


Exhibit
number

  

Description

10.16*    Amended and Restated Produced Water Services Agreement, Agreement Addendum 05, effective as of October 1, 2015, among Noble Energy, Inc., Noble Midstream Services, LLC and Laramie River DevCo LP (previously filed as Exhibit 10.16 to the Noble Midstream Partners LP Registration Statement on Form S-1 (333-207560) filed on October 22, 2015)
10.16.1*    Second Amended and Restated Produced Water Services Agreement, Agreement Addendum 05, effective as of March 31, 2016, among Noble Energy, Inc. and Laramie River DevCo LP (previously filed as Exhibit 10.16.1 to Amendment No. 5 to the Noble Midstream Partners LP Registration Statement on Form S-1 (333-207560) filed on July 22, 2016)
10.16.1.1
   Amendment 01 to that certain Second Amended and Restated Produced Water Services Agreement, together with Agreement Addendum 05, effective as of September 1, 2016, among Noble Energy, Inc. and Laramie River DevCo LP
10.16.2*    Second Amended and Restated Produced Water Services Agreement, Agreement Addendum XX, effective as of March 31, 2016, among Noble Energy, Inc. and Noble Midstream Services, LLC (previously filed as Exhibit 10.16.2 to Amendment No. 5 to the Noble Midstream Partners LP Registration Statement on Form S-1 (333-207560) filed on July 22, 2016)
10.17*    Second Amended and Restated Agreement Terms and Conditions Relating to Fresh Water Services (previously filed as Exhibit 10.17 to Amendment No. 5 to the Noble Midstream Partners LP Registration Statement on Form S-1 (333-207560) filed on July 22, 2016)
10.18†*    Amended and Restated Fresh Water Services Agreement, Agreement Addendum 01, effective as of October 1, 2015, among Noble Energy, Inc., Noble Midstream Services, LLC and Colorado River DevCo LP (previously filed as Exhibit 10.18 to the Noble Midstream Partners LP Registration Statement on Form S-1 (333-207560) filed on October 22, 2015)
10.18.1†*    Second Amended and Restated Fresh Water Services Agreement, Agreement Addendum 01, effective as of March 31, 2016, among Noble Energy, Inc. and Colorado River DevCo LP (previously filed as Exhibit 10.18.1 to Amendment No. 5 to the Noble Midstream Partners LP Registration Statement on Form S-1 (333-207560) filed on July 22, 2016)
10.18.2    Amendment 01 to that certain Second Amended and Restated Fresh Water Services Agreement, together with Agreement Addendum 01, effective as of September 1, 2016, among Noble Energy, Inc. and Colorado River DevCo LP
10.19†*    Amended and Restated Fresh Water Services Agreement, Agreement Addendum 02, effective as of October 1, 2015, among Noble Energy, Inc., Noble Midstream Services, LLC and San Juan River DevCo LP (previously filed as Exhibit 10.19 to the Noble Midstream Partners LP Registration Statement on Form S-1 (333-207560) filed on October 22, 2015)
10.19.1†*    Second Amended and Restated Fresh Water Services Agreement, Agreement Addendum 02, effective as of March 31, 2016, among Noble Energy, Inc. and San Juan River DevCo LP (previously filed as Exhibit 10.19.1 to Amendment No. 5 to the Noble Midstream Partners LP Registration Statement on Form S-1 (333-207560) filed on July 22, 2016)
10.19.2    Amendment 01 to that certain Second Amended and Restated Fresh Water Services Agreement, together with Agreement Addendum 02, effective as of September 1, 2016, among Noble Energy, Inc. and San Juan River DevCo LP
10.20†*    Amended and Restated Fresh Water Services Agreement, Agreement Addendum 03, effective as of October 1, 2015, among Noble Energy, Inc., Noble Midstream Services, LLC and Green River DevCo LP (previously filed as Exhibit 10.20 to the Noble Midstream Partners LP Registration Statement on Form S-1 (333-207560) filed on October 22, 2015)

 

II-5


Exhibit
number

  

Description

10.20.1†*    Second Amended and Restated Fresh Water Services Agreement, Agreement Addendum 03, effective as of March 31, 2016, among Noble Energy, Inc. and Green River DevCo LP (previously filed as Exhibit 10.20.1 to Amendment No. 5 to the Noble Midstream Partners LP Registration Statement on Form S-1 (333-207560) filed on July 22, 2016)
10.20.2    Amendment 01 to that certain Second Amended and Restated Fresh Water Services Agreement, together with Agreement Addendum 03, effective as of September 1, 2016, among Noble Energy, Inc. and Green River DevCo LP
10.21*    Amended and Restated Fresh Water Services Agreement, Agreement Addendum 04, effective as of October 1, 2015, among Noble Energy, Inc., Noble Midstream Services, LLC and Gunnison River DevCo LP (previously filed as Exhibit 10.21 to the Noble Midstream Partners LP Registration Statement on Form S-1 (333-207560) filed on October 22, 2015)
10.21.1*    Second Amended and Restated Fresh Water Services Agreement, Agreement Addendum 04, effective as of March 31, 2016, among Noble Energy, Inc. and Gunnison River DevCo LP (previously filed as Exhibit 10.21.1 to Amendment No. 5 to the Noble Midstream Partners LP Registration Statement on Form S-1 (333-207560) filed on July 22, 2016)
10.21.2    Amendment 01 to that certain Second Amended and Restated Fresh Water Services Agreement, together with Agreement Addendum 04, effective as of September 1, 2016, among Noble Energy, Inc. and Gunnison River DevCo LP
10.22*    Amended and Restated Fresh Water Services Agreement, Agreement Addendum 05, effective as of October 1, 2015, among Noble Energy, Inc., Noble Midstream Services, LLC and Laramie River DevCo LP (previously filed as Exhibit 10.22 to the Noble Midstream Partners LP Registration Statement on Form S-1 (333-207560) filed on October 22, 2015)
10.22.1*    Second Amended and Restated Fresh Water Services Agreement, Agreement Addendum 05, effective as of March 31, 2016, among Noble Energy, Inc. and Laramie River DevCo LP (previously filed as Exhibit 10.22.1 to Amendment No. 5 to the Noble Midstream Partners LP Registration Statement on Form S-1 (333-207560) filed on July 22, 2016)
10.22.1.1    Amendment 01 to that certain Second Amended and Restated Fresh Water Services Agreement, together with Agreement Addendum 05, effective as of September 1, 2016, among Noble Energy, Inc. and Laramie River DevCo LP
10.22.2*    Second Amended and Restated Fresh Water Services Agreement, Agreement Addendum XX, effective as of March 31, 2016, among Noble Energy, Inc. and Noble Midstream Services, LLC (previously filed as Exhibit 10.22.2 to Amendment No. 5 to the Noble Midstream Partners LP Registration Statement on Form S-1 (333-207560) filed on July 22, 2016)
10.23*    Second Amended and Restated Terms and Conditions Relating to Crude Oil Gathering Services (previously filed as Exhibit 10.23 to Amendment No. 5 to the Noble Midstream Partners LP Registration Statement on Form S-1 (333-207560) filed on July 22, 2016)
10.24†*    Amended and Restated Crude Oil Gathering Agreement, Agreement Addendum 01, effective as of October 1, 2015, among Noble Energy, Inc., Noble Midstream Services, LLC and Colorado River DevCo LP (previously filed as Exhibit 10.24 to the Noble Midstream Partners LP Registration Statement on Form S-1 (333-207560) filed on October 22, 2015)
10.24.1†*    Second Amended and Restated Crude Oil Gathering Agreement, Agreement Addendum 01, effective as of March 31, 2016, among Noble Energy, Inc. and Colorado River DevCo LP (previously filed as Exhibit 10.24.1 to Amendment No. 5 to the Noble Midstream Partners LP Registration Statement on Form S-1 (333-207560) filed on July 22, 2016)

 

II-6


Exhibit
number

  

Description

10.24.2    Amendment 01 to that certain Second Amended and Restated Crude Oil Gathering Agreement, together with Agreement Addendum 01, effective as of September 1, 2016, among Noble Energy, Inc. and Colorado River DevCo LP
10.25†*    Amended and Restated Crude Oil Gathering Agreement, Agreement Addendum 02, effective as of October 1, 2015, among Noble Energy, Inc., Noble Midstream Services, LLC and Colorado River DevCo LP (previously filed as Exhibit 10.25 to the Noble Midstream Partners LP Registration Statement on Form S-1 (333-207560) filed on October 22, 2015)
10.25.1†*    Second Amended and Restated Crude Oil Gathering Agreement, Agreement Addendum 02, effective as of March 31, 2016, among Noble Energy, Inc. and Colorado River DevCo LP (previously filed as Exhibit 10.25.1 to Amendment No. 5 to the Noble Midstream Partners LP Registration Statement on Form S-1 (333-207560) filed on July 22, 2016)
10.25.2    Amendment 01 to that certain Second Amended and Restated Crude Oil Gathering Agreement, together with Agreement Addendum 02, effective as of September 1, 2016, among Noble Energy, Inc. and Colorado River DevCo LP
10.26*    Amended and Restated Crude Oil Gathering Agreement, Agreement Addendum 03, effective as of October 1, 2015, among Noble Energy, Inc., Noble Midstream Services, LLC and Green River DevCo LP (previously filed as Exhibit 10.26 to the Noble Midstream Partners LP Registration Statement on Form S-1 (333-207560) filed on October 22, 2015)
10.26.1*    Second Amended and Restated Crude Oil Gathering Agreement, Agreement Addendum 03, effective as of March 31, 2016, among Noble Energy, Inc. and Green River DevCo LP (previously filed as Exhibit 10.26.1 to Amendment No. 5 to the Noble Midstream Partners LP Registration Statement on Form S-1 (333-207560) filed on July 22, 2016)
10.26.2    Amendment 01 to that certain Second Amended and Restated Crude Oil Gathering Agreement, together with Agreement Addendum 03, effective as of September 1, 2016, among Noble Energy, Inc. and Green River DevCo LP
10.27*    Amended and Restated Crude Oil Gathering Agreement, Agreement Addendum 04, effective as of October 1, 2015, among Noble Energy, Inc., Noble Midstream Services, LLC and Gunnison River DevCo LP (previously filed as Exhibit 10.27 to the Noble Midstream Partners LP Registration Statement on Form S-1 (333-207560) filed on October 22, 2015)
10.27.1*    Second Amended and Restated Crude Oil Gathering Agreement, Agreement Addendum 04, effective as of March 31, 2016, among Noble Energy, Inc. and Gunnison River DevCo LP (previously filed as Exhibit 10.27.1 to Amendment No. 5 to the Noble Midstream Partners LP Registration Statement on Form S-1 (333-207560) filed on July 22, 2016)
10.27.2    Amendment 01 to that certain Second Amended and Restated Crude Oil Gathering Agreement, together with Agreement Addendum 04, effective as of September 1, 2016, among Noble Energy, Inc. and Gunnison River DevCo LP
10.28*    Amended and Restated Crude Oil Gathering Agreement, Agreement Addendum 05, effective as of October 1, 2015, among Noble Energy, Inc., Noble Midstream Services, LLC and Laramie River DevCo LP (previously filed as Exhibit 10.28 to the Noble Midstream Partners LP Registration Statement on Form S-1 (333-207560) filed on October 22, 2015)
10.28.1*    Second Amended and Restated Crude Oil Gathering Agreement, Agreement Addendum 05, effective as of March 31, 2016, among Noble Energy, Inc. and Laramie River DevCo LP (previously filed as Exhibit 10.28.1 to Amendment No. 5 to the Noble Midstream Partners LP Registration Statement on Form S-1 (333-207560) filed on July 22, 2016)

 

II-7


Exhibit
number

  

Description

10.28.1.1    Amendment 01 to that certain Second Amended and Restated Crude Oil Gathering Agreement, together with Agreement Addendum 05, effective as of September 1, 2016, among Noble Energy, Inc. and Laramie River DevCo LP
10.28.2*    Second Amended and Restated Crude Oil Gathering Agreement, Agreement Addendum XX, effective as of March 31, 2016, among Noble Energy, Inc. and Noble Midstream Services, LLC (previously filed as Exhibit 10.28.2 to Amendment No. 5 to the Noble Midstream Partners LP Registration Statement on Form S-1 (333-207560) filed on July 22, 2016)
10.29*    Form of Agreement of Limited Partnership of Colorado River DevCo LP (previously filed as Exhibit 10.29 to Amendment No. 1 to the Noble Midstream Partners LP Registration Statement on Form S-1 (333-207560) filed on November 6, 2015)
10.30*    Form of Agreement of Limited Partnership of Green River DevCo LP (previously filed as Exhibit 10.30 to Amendment No. 1 to the Noble Midstream Partners LP Registration Statement on Form S-1 (333-207560) filed on November 6, 2015)
10.31*    Form of Agreement of Limited Partnership of Gunnison River DevCo LP (previously filed as Exhibit 10.31 to Amendment No. 1 to the Noble Midstream Partners LP Registration Statement on Form S-1 (333-207560) filed on November 6, 2015)
10.32*    Form of Agreement of Limited Partnership of Laramie River DevCo LP (previously filed as Exhibit 10.32 to Amendment No. 1 to the Noble Midstream Partners LP Registration Statement on Form S-1 (333-207560) filed on November 6, 2015)
10.33*    Form of Agreement of Limited Partnership of San Juan River DevCo LP (previously filed as Exhibit 10.33 to Amendment No. 1 to the Noble Midstream Partners LP Registration Statement on Form S-1 (333-207560) filed on November 6, 2015)
10.34*    Form of Agreement of Limited Partnership of Blanco River DevCo LP (previously filed as Exhibit 10.34 to Amendment No. 5 to the Noble Midstream Partners LP Registration Statement on Form S-1 (333-207560) filed on July 22, 2016)
10.35    Texas Agreement Terms and Conditions Relating to Crude Oil Gathering Services
10.36†    Texas Oil Gathering Agreement, Agreement Addendum 01, effective as of September 1, 2016, between Rosetta Resources Operating LP and Blanco River DevCo LP
10.37    Texas Agreement Terms and Conditions Relating to Produced Water Services
10.38†    Texas Produced Water Services Agreement, Agreement Addendum 01, effective as of September 1, 2016, between Rosetta Resources Operating LP and Blanco River DevCo LP
21.1*    List of Subsidiaries of Noble Midstream Partners LP (previously filed as Exhibit 21.1 to Amendment No. 5 to the Noble Midstream Partners LP Registration Statement on Form S-1 (333-207560) filed on July 22, 2016)
23.1*    Consent of KPMG LLP
23.2*    Consent of KPMG LLP
23.3*    Consent of Andrews Kurth LLP (contained in Exhibit 5.1)
23.4*    Consent of Andrews Kurth LLP (contained in Exhibit 8.1)
23.5*    Consent of Director Nominee (previously filed as Exhibit 23.5 to Amendment No. 5 to the Noble Midstream Partners LP Registration Statement on Form S-1 (333-207560) filed on July 22, 2016)
24.1*    Powers of Attorney (contained on the signature page to this Registration Statement)

 

* Filed previously.

 

II-8


# Compensatory plan, contract or arrangement.
Confidential treatment has been requested for certain portions thereof pursuant to a Confidential Treatment Request filed with the Securities and Exchange Commission. Such provisions have been filed separately with the Securities and Exchange Commission.

Item 17. Undertakings

The undersigned registrant hereby undertakes to provide to the underwriters at the closing specified in the underwriting agreement certificates in such denominations and registered in such names as required by the underwriters to permit prompt delivery to each purchaser.

Insofar as indemnification for liabilities arising under the Securities Act may be permitted to directors, officers and controlling persons of the registrant pursuant to the foregoing provisions, or otherwise, the registrant has been advised that in the opinion of the Securities and Exchange Commission such indemnification is against public policy as expressed in the Securities Act and is, therefore, unenforceable. In the event that a claim for indemnification against such liabilities (other than the payment by the registrant of expenses incurred or paid by a director, officer or controlling person of the registrant in the successful defense of any action, suit or proceeding) is asserted by such director, officer or controlling person in connection with the securities being registered, the registrant will, unless in the opinion of its counsel the matter has been settled by controlling precedent, submit to a court of appropriate jurisdiction the question whether such indemnification by it is against public policy as expressed in the Securities Act and will be governed by the final adjudication of such issue.

The undersigned registrant hereby undertakes that,

(1) For purposes of determining any liability under the Securities Act, the information omitted from the form of prospectus filed as part of this registration statement in reliance upon Rule 430A and contained in a form of prospectus filed by the registrant pursuant to Rule 424(b)(1) or (4) or 497(h) under the Securities Act shall be deemed to be part of this registration statement as of the time it was declared effective.

(2) For the purpose of determining any liability under the Securities Act, each post-effective amendment that contains a form of prospectus shall be deemed to be a new registration statement relating to the securities offered therein, and the offering of such securities at that time shall be deemed to be the initial bona fide offering thereof.

(3) That, for the purpose of determining liability under the Securities Act of 1933 to any purchaser, each prospectus filed pursuant to Rule 424(b) as part of a registration statement relating to an offering, other than registration statements relying on Rule 430B or other than prospectuses filed in reliance on Rule 430A, shall be deemed to be part of and included in the registration statement as of the date it is first used after effectiveness. Provided, however , that no statement made in a registration statement or prospectus that is part of the registration statement or made in a document incorporated or deemed incorporated by reference into the registration statement or prospectus that is part of the registration statement will, as to a purchaser with a time of contract of sale prior to such first use, supersede or modify any statement that was made in the registration statement or prospectus that was part of the registration statement or made in any such document immediately prior to such date of first use.

(4) That, for the purpose of determining liability of the registrant under the Securities Act of 1933 to any purchaser in the initial distribution of the securities, the undersigned registrant undertakes that in a primary offering of securities of the undersigned registrant pursuant to this registration statement, regardless of the underwriting method used to sell the securities to the purchaser, if the securities are offered or sold to such purchaser by means of any of the following communications, the undersigned registrant will be a seller to the purchaser and will be considered to offer or sell such securities to such purchaser:

 

 

II-9


(a) Any preliminary prospectus or prospectus of the undersigned registrant relating to the offering required to be filed pursuant to Rule 424;

(b) If the registrant is subject to Rule 430C, each prospectus filed pursuant to Rule 424(b) as part of a registration statement relating to an offering, other than registration statements relying on Rule 430B or other than prospectuses filed in reliance on Rule 430A, shall be deemed to be part of and included in the registration statement as of the date it is first used after effectiveness. Provided, however, that no statement made in a registration statement or prospectus that is part of the registration statement or made in a document incorporated or deemed incorporated by reference into the registration statement or prospectus that is part of the registration statement will, as to a purchaser with a time of contract of sale prior to such first use, supersede or modify any statement that was made in the registration statement or prospectus that was part of the registration statement or made in any such document immediately prior to such date of first use;

(c) Any free writing prospectus relating to the offering prepared by or on behalf of the undersigned registrant or used or referred to by the undersigned registrant;

(d) The portion of any other free writing prospectus relating to the offering containing material information about the undersigned registrant or its securities provided by or on behalf of the undersigned registrant; and

(e) Any other communication that is an offer in the offering made by the undersigned registrant to the purchaser.

The undersigned registrant undertakes to send to each common unitholder, at least on an annual basis, a detailed statement of any transactions with Noble Midstream GP LLC, our general partner, or its affiliates and of fees, commissions, compensation and other benefits paid, or accrued to Noble Midstream GP LLC or its affiliates for the fiscal year completed, showing the amount paid or accrued to each recipient and the services performed.

The registrant undertakes to provide to the common unitholders the financial statements required by Form 10-K for the first full fiscal year of operations of the registrant.

 

II-10


SIGNATURES

Pursuant to the requirements of the Securities Act of 1933, as amended, the registrant has duly caused this Registration Statement to be signed on its behalf by the undersigned, thereunto duly authorized, in the City of Houston, State of Texas, on September 6, 2016.

 

NOBLE MIDSTREAM PARTNERS LP

By:        

 

Noble Midstream GP LLC,

 

its general partner

 

             By:        

 

/s/ Terry R. Gerhart

 

Terry R. Gerhart

 

Chief Executive Officer

Pursuant to the requirements of the Securities Act of 1933, as amended, this Registration Statement has been signed below by the following persons in the capacities indicated on September 6, 2016.

 

/s/ Terry R. Gerhart

Terry R. Gerhart

  

Chief Executive Officer and Director

(Principal Executive Officer)

*

John F. Bookout, IV

  

Chief Financial Officer

(Principal Financial Officer)

*

Kenneth M. Fisher

  

Chairman of the Board of Directors

*

Charles J. Rimer

  

Director

*

Gary W. Willingham

  

Director

* Terry R. Gerhart hereby signs this Amendment No. 7 to the Registration Statement on behalf of the indicated persons for whom he is attorney-in-fact on September 6, 2016, pursuant to powers of attorney previously included with the Registration Statement on Form S-1 of Noble Midstream Partners LP filed on October 22, 2015 with the Securities and Exchange Commission.

 

By:

  /s/ Terry R. Gerhart
 

Terry R. Gerhart

Attorney-in-fact

 

II-11


POWER OF ATTORNEY

The person whose signature appears below appoints Terry R. Gerhart and John F. Bookout, IV , and each of them, any of whom may act without the joinder of the other, as his true and lawful attorneys-in-fact and agents, with full power of substitution and re-substitution, for him and in his name, place and stead, in any and all capacities, to sign any and all amendments (including post-effective amendments) to this Registration Statement and any Registration Statement (including any amendment thereto) for this offering that is to be effective upon filing pursuant to Rule 462(b) under the Securities Act of 1933, as amended, and to file the same, with all exhibits thereto, and all other documents in connection therewith, with the Securities and Exchange Commission, granting unto said attorneys-in-fact and agents, and each of them, full power and authority to do and perform each and every act and thing requisite and necessary to be done in connection therewith, as fully to all intents and purposes as he might or could do in person, hereby ratifying and confirming all that said attorneys-in-fact and agents, or any of them, or their or his substitute and substitutes, may lawfully do or cause to be done by virtue hereof.

Pursuant to the requirements of the Securities Act of 1933, as amended, this Registration Statement has been signed below by the following person in the capacities indicated on September 6, 2016.

 

/s/ Thomas W. Christensen

Thomas W. Christensen

  

Chief Accounting Officer

 

II-12


Exhibit Index

 

Exhibit
number

  

Description

1.1*    Form of Underwriting Agreement (including form of Lock-Up Agreement) (previously filed as Exhibit 1.1 to Amendment No. 5 to the Noble Midstream Partners LP Registration Statement on Form S-1 (333-207560) filed on July 22, 2016)
3.1*    Certificate of Limited Partnership of Noble Midstream Partners LP (previously filed as Exhibit 3.1 to the Noble Midstream Partners LP Registration Statement on Form S-1 (333-207560) filed on October 22, 2015)
3.2*    Amendment to the Certificate of Limited Partnership of Noble Midstream Partners LP (previously filed as Exhibit 3.2 to the Noble Midstream Partners LP Registration Statement on Form S-1 (333-207560) filed on October 22, 2015)
3.3*    Amendment to the Certificate of Limited Partnership of Noble Midstream Partners LP (previously filed as Exhibit 3.3 to Amendment No. 1 to the Noble Midstream Partners LP Registration Statement on Form S-1 (333-207560) filed on November 6, 2015)
3.4    Form of First Amended and Restated Agreement of Limited Partnership of Noble Midstream Partners LP (included as Appendix A to the Prospectus)
3.5*    Certificate of Formation of Noble Midstream GP LLC (previously filed as Exhibit 3.4 to the Noble Midstream Partners LP Registration Statement on Form S-1 (333-207560) filed on October 22, 2015)
3.6*    Amendment to Certificate of Formation of Noble Midstream GP LLC (previously filed as Exhibit 3.5 to the Noble Midstream Partners LP Registration Statement on Form S-1 (333-207560) filed on October 22, 2015)
3.7*    Form of First Amended and Restated Limited Liability Company Agreement of Noble Midstream GP LLC (previously filed as Exhibit 3.7 to Amendment No. 1 to the Noble Midstream Partners LP Registration Statement on Form S-1 (333-207560) filed on November 6, 2015)
5.1*    Opinion of Andrews Kurth LLP as to the legality of the securities being registered (previously filed as Exhibit 5.1 to Amendment No. 2 to the Noble Midstream Partners LP Registration Statement on Form S-1 (333-207560) filed on November 12, 2015)
8.1*    Opinion of Andrews Kurth LLP relating to tax matters (previously filed as Exhibit 8.1 to Amendment No. 2 to the Noble Midstream Partners LP Registration Statement on Form S-1 (333-207560) filed on November 12, 2015)
10.1    Form of Contribution, Conveyance and Assumption Agreement
10.2#*    Form of Noble Midstream Partners LP 2016 Long-Term Incentive Plan (previously filed as Exhibit 10.2 to Amendment No. 1 to the Noble Midstream Partners LP Registration Statement on Form S-1 (333-207560) filed on November 6, 2015)
10.3    Form of Omnibus Agreement
10.4*    Form of Operational Services and Secondment Agreement (previously filed as Exhibit 10.4 to Amendment No. 5 to the Noble Midstream Partners LP Registration Statement on Form S-1 (333-207560) filed on July 22, 2016)
10.5    Form of Credit Agreement
10.6*    Second Amended and Restated Agreement Terms and Conditions Relating to Gas Gathering Services (previously filed as Exhibit 10.6 to Amendment No. 5 to the Noble Midstream Partners LP Registration Statement on Form S-1 (333-207560) filed on July 22, 2016)
10.7†*    Amended and Restated Gas Gathering Agreement, Agreement Addendum 01, effective as of October 1, 2015, among Noble Energy, Inc., Noble Midstream Services, LLC and Colorado River DevCo LP (previously filed as Exhibit 10.7 to the Noble Midstream Partners LP Registration Statement on Form S-1 (333-207560) filed on October 22, 2015)

 

II-13


Exhibit
number

 

Description

10.7.1†*   Second Amended and Restated Gas Gathering Agreement, Agreement Addendum 01, effective as of March 31, 2016, among Noble Energy, Inc. and Colorado River DevCo LP (previously filed as Exhibit 10.7.1 to Amendment No. 5 to the Noble Midstream Partners LP Registration Statement on Form S-1 (333-207560) filed on July 22, 2016)
10.7.2   Amendment 01 to that certain Second Amended and Restated Gas Gathering Agreement, together with Agreement Addendum 01, effective as of September 1, 2016, among Noble Energy, Inc. and Colorado River DevCo LP
10.8*   Amended and Restated Gas Gathering Agreement, Agreement Addendum 03, effective as of October 1, 2015, among Noble Energy, Inc., Noble Midstream Services, LLC and Green River DevCo LP (previously filed as Exhibit 10.8 to the Noble Midstream Partners LP Registration Statement on Form S-1 (333-207560) filed on October 22, 2015)
10.8.1†*   Second Amended and Restated Gas Gathering Agreement, Agreement Addendum 03, effective as of March 31, 2016, among Noble Energy, Inc. and Green River DevCo LP (previously filed as Exhibit 10.8.1 to Amendment No. 5 to the Noble Midstream Partners LP Registration Statement on Form S-1 (333-207560) filed on July 22, 2016)
10.8.1.1   Amendment 01 to that certain Second Amended and Restated Gas Gathering Agreement, together with Agreement Addendum 03, effective as of September 1, 2016, among Noble Energy, Inc. and Green River DevCo LP
10.8.2*   Second Amended and Restated Gas Gathering Agreement, Agreement Addendum XX, effective as of March 31, 2016, among Noble Energy, Inc. and Noble Midstream Services, LLC (previously filed as Exhibit 10.8.2 to Amendment No. 5 to the Noble Midstream Partners LP Registration Statement on Form S-1 (333-207560) filed on July 22, 2016)
10.9   Third Amended and Restated Agreement Terms and Conditions Relating to Crude Oil Treating Services
10.10†*   Second Amended and Restated Crude Oil Treating Agreement, Agreement Addendum 01, effective as of October 1, 2015, among Noble Energy, Inc., Noble Midstream Services, LLC and Colorado River DevCo LP (previously filed as Exhibit 10.10 to the Noble Midstream Partners LP Registration Statement on Form S-1 (333-207560) filed on October 22, 2015)
10.10.1†   Third Amended and Restated Crude Oil Treating Agreement, Agreement Addendum 01, effective as of March 31, 2016, among Noble Energy, Inc. and Colorado River DevCo LP
10.10.2†   Third Amended and Restated Crude Oil Treating Agreement, Agreement Addendum 02, effective as of March 31, 2016, among Noble Energy, Inc. and Colorado River DevCo LP
10.11*   Second Amended and Restated Agreement Terms and Conditions Relating to Produced Water Services (previously filed as Exhibit 10.11 to Amendment No. 5 to the Noble Midstream Partners LP Registration Statement on Form S-1 (333-207560) filed on July 22, 2016)
10.12†*   Amended and Restated Produced Water Services Agreement, Agreement Addendum 01, effective as of October 1, 2015, among Noble Energy, Inc., Noble Midstream Services, LLC and Colorado River DevCo LP (previously filed as Exhibit 10.12 to the Noble Midstream Partners LP Registration Statement on Form S-1 (333-207560) filed on October 22, 2015)
10.12.1†*   Amendment 01 to Amended and Restated Produced Water Services Agreement, Agreement Addendum 01, effective as of January 1, 2016, among Noble Energy, Inc., Noble Midstream Services, LLC and Colorado River DevCo LP (previously filed as Exhibit 10.12.1 to Amendment No. 3 to the Noble Midstream Partners LP Registration Statement on Form S-1 (333-207560) filed on April 1, 2016)

 

II-14


Exhibit
number

 

Description

10.12.2†*   Second Amended and Restated Produced Water Services Agreement, Agreement Addendum 01, effective as of March 31, 2016, among Noble Energy, Inc. and Colorado River DevCo LP (previously filed as Exhibit 10.12.2 to Amendment No. 5 to the Noble Midstream Partners LP Registration Statement on Form S-1 (333-207560) filed on July 22, 2016)
10.12.3   Amendment 01 to that certain Second Amended and Restated Produced Water Services Agreement, together with Agreement Addendum 01, effective as of September 1, 2016, among Noble Energy, Inc. and Colorado River DevCo LP
10.13†*   Amended and Restated Produced Water Services Agreement, Agreement Addendum 02, effective as of October 1, 2015, among Noble Energy, Inc., Noble Midstream Services, LLC and San Juan River DevCo LP (previously filed as Exhibit 10.13 to the Noble Midstream Partners LP Registration Statement on Form S-1 (333-207560) filed on October 22, 2015)
10.13.1†*   Second Amended and Restated Produced Water Services Agreement, Agreement Addendum 02, effective as of March 31, 2016, among Noble Energy, Inc. and San Juan River DevCo LP (previously filed as Exhibit 10.13.1 to Amendment No. 5 to the Noble Midstream Partners LP Registration Statement on Form S-1 (333-207560) filed on July 22, 2016)
10.13.2   Amendment 01 to that certain Second Amended and Restated Produced Water Services Agreement, together with Agreement Addendum 02, effective as of September 1, 2016, among Noble Energy, Inc. and San Juan River DevCo LP
10.14*   Amended and Restated Produced Water Services Agreement, Agreement Addendum 03, effective as of October 1, 2015, among Noble Energy, Inc., Noble Midstream Services, LLC and Green River DevCo LP (previously filed as Exhibit 10.14 to the Noble Midstream Partners LP Registration Statement on Form S-1 (333-207560) filed on October 22, 2015)
10.14.1*   Second Amended and Restated Produced Water Services Agreement, Agreement Addendum 03, effective as of March 31, 2016, among Noble Energy, Inc. and Green River DevCo LP (previously filed as Exhibit 10.14.1 to Amendment No. 5 to the Noble Midstream Partners LP Registration Statement on Form S-1 (333-207560) filed on July 22, 2016)
10.14.2   Amendment 01 to that certain Second Amended and Restated Produced Water Services Agreement, together with Agreement Addendum 03, effective as of September 1, 2016, among Noble Energy, Inc. and Green River DevCo LP
10.15*   Amended and Restated Produced Water Services Agreement, Agreement Addendum 04, effective as of October 1, 2015, among Noble Energy, Inc., Noble Midstream Services, LLC and Gunnison River DevCo LP (previously filed as Exhibit 10.15 to the Noble Midstream Partners LP Registration Statement on Form S-1 (333-207560) filed on October 22, 2015)
10.15.1*   Second Amended and Restated Produced Water Services Agreement, Agreement Addendum 04, effective as of March 31, 2016, among Noble Energy, Inc. and Gunnison River DevCo LP (previously filed as Exhibit 10.15.1 to Amendment No. 5 to the Noble Midstream Partners LP Registration Statement on Form S-1 (333-207560) filed on July 22, 2016)
10.15.2   Amendment 01 to that certain Second Amended and Restated Produced Water Services Agreement, together with Agreement Addendum 04, effective as of September 1, 2016, among Noble Energy, Inc. and Gunnison River DevCo LP
10.16*   Amended and Restated Produced Water Services Agreement, Agreement Addendum 05, effective as of October 1, 2015, among Noble Energy, Inc., Noble Midstream Services, LLC and Laramie River DevCo LP (previously filed as Exhibit 10.16 to the Noble Midstream Partners LP Registration Statement on Form S-1 (333-207560) filed on October 22, 2015)

 

II-15


Exhibit
number

 

Description

10.16.1*   Second Amended and Restated Produced Water Services Agreement, Agreement Addendum 05, effective as of March 31, 2016, among Noble Energy, Inc. and Laramie River DevCo LP (previously filed as Exhibit 10.16.1 to Amendment No. 5 to the Noble Midstream Partners LP Registration Statement on Form S-1 (333-207560) filed on July 22, 2016)
10.16.1.1   Amendment 01 to that certain Second Amended and Restated Produced Water Services Agreement, together with Agreement Addendum 05, effective as of September 1, 2016, among Noble Energy, Inc. and Laramie River DevCo LP
10.16.2*   Second Amended and Restated Produced Water Services Agreement, Agreement Addendum XX, effective as of March 31, 2016, among Noble Energy, Inc. and Noble Midstream Services, LLC (previously filed as Exhibit 10.16.2 to Amendment No. 5 to the Noble Midstream Partners LP Registration Statement on Form S-1 (333-207560) filed on July 22, 2016)
10.17*   Second Amended and Restated Agreement Terms and Conditions Relating to Fresh Water Services (previously filed as Exhibit 10.17 to Amendment No. 5 to the Noble Midstream Partners LP Registration Statement on Form S-1 (333-207560) filed on July 22, 2016)
10.18†*   Amended and Restated Fresh Water Services Agreement, Agreement Addendum 01, effective as of October 1, 2015, among Noble Energy, Inc., Noble Midstream Services, LLC and Colorado River DevCo LP (previously filed as Exhibit 10.18 to the Noble Midstream Partners LP Registration Statement on Form S-1 (333-207560) filed on October 22, 2015)
10.18.1†*   Second Amended and Restated Fresh Water Services Agreement, Agreement Addendum 01, effective as of March 31, 2016, among Noble Energy, Inc. and Colorado River DevCo LP (previously filed as Exhibit 10.18.1 to Amendment No. 5 to the Noble Midstream Partners LP Registration Statement on Form S-1 (333-207560) filed on July 22, 2016)
10.18.2  

Amendment 01 to that certain Second Amended and Restated Fresh Water Services Agreement, together with Agreement Addendum 01, effective as of September 1, 2016, among Noble Energy, Inc. and Colorado River DevCo LP

10.19†*   Amended and Restated Fresh Water Services Agreement, Agreement Addendum 02, effective as of October 1, 2015, among Noble Energy, Inc., Noble Midstream Services, LLC and San Juan River DevCo LP (previously filed as Exhibit 10.19 to the Noble Midstream Partners LP Registration Statement on Form S-1 (333-207560) filed on October 22, 2015)
10.19.1†*   Second Amended and Restated Fresh Water Services Agreement, Agreement Addendum 02, effective as of March 31, 2016, among Noble Energy, Inc. and San Juan River DevCo LP (previously filed as Exhibit 10.19.1 to Amendment No. 5 to the Noble Midstream Partners LP Registration Statement on Form S-1 (333-207560) filed on July 22, 2016)
10.19.2  

Amendment 01 to that certain Second Amended and Restated Fresh Water Services Agreement, together with Agreement Addendum 02, effective as of September 1, 2016, among Noble Energy, Inc. and San Juan River DevCo LP

10.20†*   Amended and Restated Fresh Water Services Agreement, Agreement Addendum 03, effective as of October 1, 2015, among Noble Energy, Inc., Noble Midstream Services, LLC and Green River DevCo LP (previously filed as Exhibit 10.20 to the Noble Midstream Partners LP Registration Statement on Form S-1 (333-207560) filed on October 22, 2015)
10.20.1†*   Second Amended and Restated Fresh Water Services Agreement, Agreement Addendum 03, effective as of March 31, 2016, among Noble Energy, Inc. and Green River DevCo LP (previously filed as Exhibit 10.20.1 to Amendment No. 5 to the Noble Midstream Partners LP Registration Statement on Form S-1 (333-207560) filed on July 22, 2016)

 

II-16


Exhibit
number

 

Description

10.20.2  

Amendment 01 to that certain Second Amended and Restated Fresh Water Services Agreement, together with Agreement Addendum 03, effective as of September 1, 2016, among Noble Energy, Inc. and Green River DevCo LP

10.21*   Amended and Restated Fresh Water Services Agreement, Agreement Addendum 04, effective as of October 1, 2015, among Noble Energy, Inc., Noble Midstream Services, LLC and Gunnison River DevCo LP (previously filed as Exhibit 10.21 to the Noble Midstream Partners LP Registration Statement on Form S-1 (333-207560) filed on October 22, 2015)
10.21.1*   Second Amended and Restated Fresh Water Services Agreement, Agreement Addendum 04, effective as of March 31, 2016, among Noble Energy, Inc. and Gunnison River DevCo LP (previously filed as Exhibit 10.21.1 to Amendment No. 5 to the Noble Midstream Partners LP Registration Statement on Form S-1 (333-207560) filed on July 22, 2016)
10.21.2   Amendment 01 to that certain Second Amended and Restated Fresh Water Services Agreement, together with Agreement Addendum 04, effective as of September 1, 2016, among Noble Energy, Inc. and Gunnison River DevCo LP
10.22*   Amended and Restated Fresh Water Services Agreement, Agreement Addendum 05, effective as of October 1, 2015, among Noble Energy, Inc., Noble Midstream Services, LLC and Laramie River DevCo LP (previously filed as Exhibit 10.22 to the Noble Midstream Partners LP Registration Statement on Form S-1 (333-207560) filed on October 22, 2015)
10.22.1*   Second Amended and Restated Fresh Water Services Agreement, Agreement Addendum 05, effective as of March 31, 2016, among Noble Energy, Inc. and Laramie River DevCo LP (previously filed as Exhibit 10.22.1 to Amendment No. 5 to the Noble Midstream Partners LP Registration Statement on Form S-1 (333-207560) filed on July 22, 2016)
10.22.1.1   Amendment 01 to that certain Second Amended and Restated Fresh Water Services Agreement, together with Agreement Addendum 05, effective as of September 1, 2016, among Noble Energy, Inc. and Laramie River DevCo LP
10.22.2*   Second Amended and Restated Fresh Water Services Agreement, Agreement Addendum XX, effective as of March 31, 2016, among Noble Energy, Inc. and Noble Midstream Services, LLC (previously filed as Exhibit 10.22.2 to Amendment No. 5 to the Noble Midstream Partners LP Registration Statement on Form S-1 (333-207560) filed on July 22, 2016)
10.23*   Second Amended and Restated Terms and Conditions Relating to Crude Oil Gathering Services (previously filed as Exhibit 10.23 to Amendment No. 5 to the Noble Midstream Partners LP Registration Statement on Form S-1 (333-207560) filed on July 22, 2016)
10.24†*   Amended and Restated Crude Oil Gathering Agreement, Agreement Addendum 01, effective as of October 1, 2015, among Noble Energy, Inc., Noble Midstream Services, LLC and Colorado River DevCo LP (previously filed as Exhibit 10.24 to the Noble Midstream Partners LP Registration Statement on Form S-1 (333-207560) filed on October 22, 2015)
10.24.1†*   Second Amended and Restated Crude Oil Gathering Agreement, Agreement Addendum 01, effective as of March 31, 2016, among Noble Energy, Inc. and Colorado River DevCo LP (previously filed as Exhibit 10.24.1 to Amendment No. 5 to the Noble Midstream Partners LP Registration Statement on Form S-1 (333-207560) filed on July 22, 2016)
10.24.2   Amendment 01 to that certain Second Amended and Restated Crude Oil Gathering Agreement, together with Agreement Addendum 01, effective as of September 1, 2016, among Noble Energy, Inc. and Colorado River DevCo LP
10.25†*   Amended and Restated Crude Oil Gathering Agreement, Agreement Addendum 02, effective as of October 1, 2015, among Noble Energy, Inc., Noble Midstream Services, LLC and Colorado River DevCo LP (previously filed as Exhibit 10.25 to the Noble Midstream Partners LP Registration Statement on Form S-1 (333-207560) filed on October 22, 2015)

 

II-17


Exhibit
number

 

Description

10.25.1†*   Second Amended and Restated Crude Oil Gathering Agreement, Agreement Addendum 02, effective as of March 31, 2016, among Noble Energy, Inc. and Colorado River DevCo LP (previously filed as Exhibit 10.25.1 to Amendment No. 5 to the Noble Midstream Partners LP Registration Statement on Form S-1 (333-207560) filed on July 22, 2016)
10.25.2   Amendment 01 to that certain Second Amended and Restated Crude Oil Gathering Agreement, together with Agreement Addendum 02, effective as of September 1, 2016, among Noble Energy, Inc. and Colorado River DevCo LP
10.26*   Amended and Restated Crude Oil Gathering Agreement, Agreement Addendum 03, effective as of October 1, 2015, among Noble Energy, Inc., Noble Midstream Services, LLC and Green River DevCo LP (previously filed as Exhibit 10.26 to the Noble Midstream Partners LP Registration Statement on Form S-1 (333-207560) filed on October 22, 2015)
10.26.1*   Second Amended and Restated Crude Oil Gathering Agreement, Agreement Addendum 03, effective as of March 31, 2016, among Noble Energy, Inc. and Green River DevCo LP (previously filed as Exhibit 10.26.1 to Amendment No. 5 to the Noble Midstream Partners LP Registration Statement on Form S-1 (333-207560) filed on July 22, 2016)
10.26.2   Amendment 01 to that certain Second Amended and Restated Crude Oil Gathering Agreement, together with Agreement Addendum 03, effective as of September 1, 2016, among Noble Energy, Inc. and Green River DevCo LP
10.27*   Amended and Restated Crude Oil Gathering Agreement, Agreement Addendum 04, effective as of October 1, 2015, among Noble Energy, Inc., Noble Midstream Services, LLC and Gunnison River DevCo LP (previously filed as Exhibit 10.27 to the Noble Midstream Partners LP Registration Statement on Form S-1 (333-207560) filed on October 22, 2015)
10.27.1*   Second Amended and Restated Crude Oil Gathering Agreement, Agreement Addendum 04, effective as of March 31, 2016, among Noble Energy, Inc. and Gunnison River DevCo LP (previously filed as Exhibit 10.27.1 to Amendment No. 5 to the Noble Midstream Partners LP Registration Statement on Form S-1 (333-207560) filed on July 22, 2016)
10.27.2   Amendment 01 to that certain Second Amended and Restated Crude Oil Gathering Agreement, together with Agreement Addendum 04, effective as of September 1, 2016, among Noble Energy, Inc. and Gunnison River DevCo LP
10.28*   Amended and Restated Crude Oil Gathering Agreement, Agreement Addendum 05, effective as of October 1, 2015, among Noble Energy, Inc., Noble Midstream Services, LLC and Laramie River DevCo LP (previously filed as Exhibit 10.28 to the Noble Midstream Partners LP Registration Statement on Form S-1 (333-207560) filed on October 22, 2015)
10.28.1*   Second Amended and Restated Crude Oil Gathering Agreement, Agreement Addendum 05, effective as of March 31, 2016, among Noble Energy, Inc. and Laramie River DevCo LP (previously filed as Exhibit 10.28.1 to Amendment No. 5 to the Noble Midstream Partners LP Registration Statement on Form S-1 (333-207560) filed on July 22, 2016)
10.28.1.1   Amendment 01 to that certain Second Amended and Restated Crude Oil Gathering Agreement, together with Agreement Addendum 05, effective as of September 1, 2016, among Noble Energy, Inc. and Laramie River DevCo LP
10.28.2*   Second Amended and Restated Crude Oil Gathering Agreement, Agreement Addendum XX, effective as of March 31, 2016, among Noble Energy, Inc. and Noble Midstream Services, LLC (previously filed as Exhibit 10.28.2 to Amendment No. 5 to the Noble Midstream Partners LP Registration Statement on Form S-1 (333-207560) filed on July 22, 2016)

 

II-18


Exhibit
number

 

Description

10.29*   Form of Agreement of Limited Partnership of Colorado River DevCo LP (previously filed as Exhibit 10.29 to Amendment No. 1 to the Noble Midstream Partners LP Registration Statement on Form S-1 (333-207560) filed on November 6, 2015)
10.30*   Form of Agreement of Limited Partnership of Green River DevCo LP (previously filed as Exhibit 10.30 to Amendment No. 1 to the Noble Midstream Partners LP Registration Statement on Form S-1 (333-207560) filed on November 6, 2015)
10.31*   Form of Agreement of Limited Partnership of Gunnison River DevCo LP (previously filed as Exhibit 10.31 to Amendment No. 1 to the Noble Midstream Partners LP Registration Statement on Form S-1 (333-207560) filed on November 6, 2015)
10.32*     Form of Agreement of Limited Partnership of Laramie River DevCo LP (previously filed as Exhibit 10.32 to Amendment No. 1 to the Noble Midstream Partners LP Registration Statement on Form S-1 (333-207560) filed on November 6, 2015)
10.33*     Form of Agreement of Limited Partnership of San Juan River DevCo LP (previously filed as Exhibit 10.33 to Amendment No. 1 to the Noble Midstream Partners LP Registration Statement on Form S-1 (333-207560) filed on November 6, 2015)
10.34*   Form of Agreement of Limited Partnership of Blanco River DevCo LP (previously filed as Exhibit 10.34 to Amendment No. 5 to the Noble Midstream Partners LP Registration Statement on Form S-1 (333-207560) filed on July 22, 2016)
10.35   Texas Agreement Terms and Conditions Relating to Crude Oil Gathering Services
10.36†   Texas Oil Gathering Agreement, Agreement Addendum 01, effective as of September 1, 2016, between Rosetta Resources Operating LP and Blanco River DevCo LP
10.37   Texas Agreement Terms and Conditions Relating to Produced Water Services
10.38†   Texas Produced Water Services Agreement, Agreement Addendum 01, effective as of September 1, 2016, between Rosetta Resources Operating LP and Blanco River DevCo LP
21.1*   List of Subsidiaries of Noble Midstream Partners LP (previously filed as Exhibit 21.1 to Amendment No. 5 to the Noble Midstream Partners LP Registration Statement on Form S-1 (333-207560) filed on July 22, 2016)
23.1*      Consent of KPMG LLP
23.2*      Consent of KPMG LLP
23.3*       Consent of Andrews Kurth LLP (contained in Exhibit 5.1)
23.4*       Consent of Andrews Kurth LLP (contained in Exhibit 8.1)
23.5*       Consent of Director Nominee (previously filed as Exhibit 23.5 to Amendment No. 5 to the Noble Midstream Partners LP Registration Statement on Form S-1 (333-207560) filed on July 22, 2016)
24.1*     Powers of Attorney (contained on the signature page to this Registration Statement)

 

* Filed previously.
# Compensatory plan, contract or arrangement.
Confidential treatment has been requested for certain portions thereof pursuant to a Confidential Treatment Request filed with the Securities and Exchange Commission. Such provisions have been filed separately with the Securities and Exchange Commission.

 

II-19

Exhibit 10.1

FORM OF CONTRIBUTION, CONVEYANCE AND ASSUMPTION AGREEMENT

This CONTRIBUTION , CONVEYANCE AND ASSUMPTION AGREEMENT , dated as of [            ], 2016 (this “ Agreement ”), is by and among NOBLE MIDSTREAM PARTNERS LP , a Delaware limited partnership (the “ Partnership ”), NOBLE MIDSTREAM GP LLC , a Delaware limited liability company and the general partner of the Partnership (the “ General Partner ”), NOBLE ENERGY, INC. , a Delaware corporation (“ Noble ”), NOBLE MIDSTREAM SERVICES, LLC , a Delaware limited liability company (“ Opco ”), NBL MIDSTREAM, LLC , a Delaware limited liability company (“ NBL Midstream ”), NBL MIDSTREAM HOLDINGS, LLC , a Delaware limited liability company (“ NBL Midstream Holdings ”), COLORADO RIVER DEVCO GP LLC , a Delaware limited liability company (“ Colorado River GP ”), GREEN RIVER DEVCO GP LLC , a Delaware limited liability company (“ Green River GP ”), GUNNISON RIVER DEVCO GP LLC , a Delaware limited liability company (“ Gunnison River GP ”), LARAMIE RIVER DEVCO GP LLC , a Delaware limited liability company (“ Laramie River GP ”), SAN JUAN RIVER DEVCO GP LLC , a Delaware limited liability company (“ San Juan River GP ”), BLANCO RIVER DEVCO LP , a Delaware limited partnership (“ Blanco River LP ”) and BLANCO RIVER DEVCO GP LLC , a Delaware limited liability company (“ Blanco River GP ”) (each, a “ Party ” and collectively, the “ Parties ”).

RECITALS

WHEREAS , the General Partner and Opco have caused the formation of the Partnership pursuant to the Delaware Revised Uniform Limited Partnership Act (as amended from time to time, the “ Delaware Partnership Act ”) for the purpose of owning, operating, developing and acquiring domestic midstream infrastructure assets, as well as engaging in any business activity that is approved by the General Partner and that lawfully may be conducted by a limited partnership organized under the Delaware Partnership Act;

WHEREAS , in order to accomplish the objectives and purposes in the first recital above, each of the following actions has been taken on or prior to the date hereof:

1. Opco and its wholly owned subsidiary Colorado River GP formed Colorado River DevCo LP, a Delaware limited partnership (“ Colorado River LP ”), and contributed an aggregate of $1,000 to Colorado River LP in exchange for a 99% limited partner interest and 1% general partner interest in Colorado River LP, respectively;

2. Opco and its wholly owned subsidiary Green River GP formed Green River DevCo LP, a Delaware limited partnership (“ Green River LP ”), and contributed an aggregate of $1,000 to Green River LP in exchange for a 99% limited partner interest and 1% general partner interest in Green River LP, respectively;

3. Opco and its wholly owned subsidiary Gunnison River GP, formed Gunnison River DevCo LP, a Delaware limited partnership (“ Gunnison River LP ”), and contributed an aggregate of $1,000 to Gunnison River LP in exchange for a 99% limited partner interest and 1% general partner interest in Gunnison River LP, respectively;


4. Opco and its wholly owned subsidiary Laramie River , formed Laramie River DevCo LP, a Delaware limited partnership (“ Laramie River LP ”), and contributed an aggregate of $1,000 to Laramie River LP in exchange for a 99% limited partner interest and 1% general partner interest in Laramie River LP, respectively; and

5. Opco and its wholly owned subsidiary San Juan River GP formed San Juan River DevCo LP, a Delaware limited partnership (“ San Juan River LP ”), and contributed an aggregate of $1,000 to San Juan River LP in exchange for a 99% limited partner interest and 1% general partner interest in San Juan River LP, respectively;

6. Opco contributed to Colorado River LP all right, title and interest in and to all of Opco’s interest in and to (a) the crude oil, natural gas and produced water gathering system and assets servicing the Wells Ranch IDP (as described on Exhibit A ), (b) the central gathering facility servicing the Wells Ranch IDP, (c) the fresh water storage and delivery system assets servicing the Wells Ranch IDP, (d) the crude oil gathering system assets servicing the East Pony IDP, (e) the Plattesville crude oil treating facility assets, (f) the Briggsdale crude oil treating facility assets, (g) Real Estate Agreements (as defined herein) to the extent the same relate to (a)-(f) with a portion of the assets listed in (a)-(g) conveyed by Opco on behalf of Colorado River GP such that Colorado River GP holds a 75% general partner interest and Opco holds a 25% limited partner interest in Colorado River LP;

7. Opco contributed to Green River LP all right, title and interest in and to all of Opco’s interest in each Real Estate Agreement related to the Mustang IDP (as described on Exhibit A ), which such Real Estate Agreements related to fresh water systems being constructed and to crude oil, natural gas and additional water infrastructure that is planned in the Mustang IDP (collectively, the “ Mustang IDP Assets ”), with a portion of the Mustang IDP Assets conveyed by Opco on behalf of Green River GP such that Green River GP holds a 10% general partner interest and Opco holds a 90% limited partner interest in Green River LP;

8. Opco contributed to Gunnison River LP all right, title and interest in and to a 4% limited partner interest in Gunnison River LP held by Opco, which converted to a general partner interest in Gunnison River LP such that Gunnison River GP holds a 5% general partner interest and Opco holds a 95% limited partner interest in Gunnison River LP;

9. Opco contributed to Laramie River LP all right, title and interest in and to a 4% limited partner interest in Laramie River LP held by Opco, which converted to a general partner interest in Laramie River LP such that Laramie River GP holds a 5% general partner interest and Opco holds a 95% limited partner interest in Laramie River LP;

10. Opco contributed to San Juan River LP all right, title and interest in and to (a) the fresh water storage and delivery system assets servicing the East Pony IDP and (b) all of Opco’s interest in Real Estate Agreements to the extent the same relate to produced water facilities and a fresh water system, which are being constructed and will consist of pipelines, ponds and storage capacity in the East Pony IDP (collectively, the “East Pony IDP Assets”), with a portion of the East Pony IDP Assets conveyed by Opco on behalf of San Juan River GP such that San Juan River GP holds a 5% general partner interest and Opco holds a 95% limited partner interest in San Juan River LP;

 

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11. Opco distributed to NBL Midstream, who in turn contributed to NBL Midstream Holdings, LLC, a Delaware limited liability company (“ NBLMH ”), all right, title and interest in and to all of Opco’s interest in (a) the natural gas gathering system servicing the East Pony IDP, (b) the Keota gas processing plant servicing the East Pony IDP, (c) the Keota LNG plant, (d) the Lilli gas processing plant servicing the greater East Pony IDP, (e) Non-System Pipelines located in Northern Colorado and (f) Real Estate Agreements to the extent the same relate to (a)-(e); and

12. Opco and its wholly owned subsidiary Blanco River GP formed Blanco River LP and contributed an aggregate $1,000 to Blanco River LP in exchange for a 99% limited partner interest and a 1% general partner interest in Blanco River LP, respectively.

WHEREAS , concurrently with the consummation of the transactions contemplated hereby, each of the matters provided for in Article II will occur in accordance with its respective terms;

WHEREAS , the boards of directors, members or partners of the Parties have taken or caused to be taken all corporate, limited liability company and partnership action, as the case may be, required to approve the transactions contemplated by this Agreement.

NOW, THEREFORE , in consideration of the mutual covenants, representations, warranties and agreements herein contained, the Parties agree as follows:

ARTICLE I

DEFINITIONS

Capitalized terms used but not otherwise defined herein shall have the respective meanings ascribed to such terms below:

Affiliate ” has the meaning assigned to it in the First Amended and Restated Agreement of Limited Partnership of the Partnership

Blanco River LP Agreement ” means the Agreement of Limited Partnership Agreement of Blanco River LP, dated as of June 6, 2016.

Closing Date ” means the date on which the closing of the Offering occurs.

Colorado LP Agreement ” means the Agreement of Limited Partnership of Colorado River LP, dated as of August 20, 2015.

Common Units ” has the meaning given such term under the LP Agreement.

DE Basin Assets ” has such meaning ascribed to it in Section 2.4 of this Agreement.

Deferred Issuance ” has the meaning given such term under the LP Agreement.

DevCo LP Interests ” means, collectively, the (i) 20% limited partner interest in Colorado River LP, (ii) 75% limited partner interest in Green River LP, (iii) 95% limited partner interest in

 

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Gunnison River LP, (iv) 75% limited partner interest in San Juan River LP, and (v) 75% limited partner interest in Blanco River LP, in each case owned by Opco after giving effect to Sections 2.1 through 2.4 , but prior to the consummation of the other transactions contemplated hereby.

DevCos ” means, collectively, Colorado River LP, Green River LP, Gunnison River LP, Laramie River LP, San Juan River LP and Blanco River LP.

Effective Time ” means 12:01 a.m. Eastern Time on [the Closing Date].

Firm Units ” means the [                    ] Common Units to be issued and sold to the Underwriters pursuant to the Underwriting Agreement.

Green River LP Agreement ” means the Agreement of Limited Partnership of Green River LP, dated as of August 20, 2015.

IDP ” means integrated development plan area.

[“ Incentive Distribution Right ” has the meaning set forth in the LP Agreement.]

IPO Proceeds ” has such meaning ascribed to it in Section 2.9 of this Agreement.

Laramie River LP Agreement ” means the Agreement of Limited Partnership of Laramie River, dated as of August 20, 2015.

LP Agreement ” means the First Amended and Restated Agreement of Limited Partnership of the Partnership.

Noble Entities ” means Noble and each of its Affiliates.

Non-System Pipelines ” means those pipelines that do not comprise a part of the assets contributed to the Partnership or the DevCos, as applicable.

Offering ” means the initial offering and sale of Common Units to the public (including the offer and sale of Common Units pursuant to the Over-Allotment Option), as described in the Registration Statement.

[“ Option Period ” means the period from the Closing Date to the date that is thirty days after the Closing Date.]

Option Units ” means up to an additional [                    ] Common Units that the Underwriters may purchase from the Partnership pursuant to the Over-Allotment Option

Original General Partner Interest ” has the meaning set forth in the LP Agreement.

Original Limited Partner Interest ” has the meaning set forth in the LP Agreement.

Over-Allotment Option ” means the option granted to the Underwriters by the Partnership pursuant to Section 2 of the Underwriting Agreement.

 

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Real Estate Agreements ” means the easements, rights-of-way, permits, use by special review, surface use agreements, joint use agreements, licenses and other agreements (including agreements that may be in negotiation or in process by a Party and are ultimately executed by a Party) from landowners, lessors, easement holders, governmental authorities, or other parties controlling the surface or subsurface estates of such land.

Registration Statement ” means the Registration Statement on Form S-1 filed with the United States Securities and Exchange Commission (Registration No. 333-207560), as amended.

San Juan River LP Agreement ” means the Agreement of Limited Partnership of San Juan River, dated as of August 20, 2015.

Structuring Fee ” has such meaning ascribed to it in Section 2.10 of this Agreement.

Transaction Expenses ” has such meaning ascribed to it in Section 2.10 of this Agreement.

Underwriters ” means, collectively, each member of the underwriting syndicate named as an underwriter in Schedule I to the Underwriting Agreement.

Underwriting Agreement ” means the Underwriting Agreement, dated [            ], by and among NBL Midstream, the Partnership, the General Partner, Opco and Barclays Capital Inc., Robert W. Baird & Co. Incorporated and J.P. Morgan Securities LLC, as representatives of the Underwriters.

ARTICLE II

CONTRIBUTIONS, ACKNOWLEDGMENTS AND DISTRIBUTIONS

The following transactions set forth in Sections 2.1 through 2.6 shall be completed immediately prior to the Effective Time:

2.1 Contribution of Colorado River Interest . Opco hereby contributes to Colorado River GP all right, title and interest in and to a 5% limited partner interest in Colorado River LP (the “ Colorado River Interest ”) held by Opco, which, notwithstanding any provision of the Colorado River LP Agreement to the contrary, is converted to a general partner interest in Colorado River LP such that after giving effect to this Section 2.1 , Colorado River GP will hold a 80% general partner interest and Opco will hold a 20% limited partner interest in Colorado River LP, and Colorado River GP hereby accepts the rights, title and interest to the Colorado River Interest as a capital contribution.

2.2 Contribution of Green River Interest . Opco hereby contributes to Green River GP all right, title and interest in and to a 15% limited partner interest in Green River LP (the “ Green River Interest ”) held by Opco, which, notwithstanding any provision of the Green River LP Agreement to the contrary, is converted to a general partner interest in Green River LP such that after giving effect to this Section 2.2 , Green River GP will hold a 25% general partner interest and Opco will hold a 75% limited partner interest in Green River LP, and Green River GP hereby accepts the rights, title and interest to the Green River Interest as a capital contribution.

 

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2.3 Contribution of San Juan Interest . Opco hereby contributes to San Juan River GP all right, title and interest in and to a 20% limited partner interest in San Juan River LP (the “ San Juan River Interest ”) held by Opco, which, notwithstanding any provision of the San Juan River LP Agreement to the contrary, is converted to a general partner interest in San Juan River LP such that after giving effect to this Section 2.3 , San Juan River GP will hold a 25% general partner interest and Opco will hold a 75% limited partner interest in San Juan River LP, and San Juan River GP hereby accepts the rights, title and interest to the Green River Interest as a capital contribution.

2.4 Contribution of Assets to Blanco River LP . Opco hereby contributes to Blanco River LP all right, title and interest in and to Real Estate Agreements related to the Delaware Basin, which Real Estate Agreements are related to crude oil gathering and produced water gathering infrastructure, to the extent that such assets and infrastructure is constructed or operated in the Delaware Basin (collectively, the “ DE Basin Assets ”) (a portion of the DE Basin Assets is being conveyed by Opco on behalf of Blanco River GP such that after giving effect to this Section 2.4 , Blanco River GP will hold a 25% general partner interest and Opco will hold a 75% limited partner interest in Blanco River LP) and Blanco River LP hereby accepts the rights, title and interest to the DE Basin Assets as capital contributions. Notwithstanding any provision of the Blanco River LP Agreement to the contrary, in consideration of the foregoing capital contributions, Blanco River LP hereby issues sufficient partnership interests in Blanco River LP to Opco and Blanco River GP such that following such contributions and issuances, Blanco River GP holds a 25% general partner interest in Blanco River LP and Opco holds a 75% limited partner interest in Blanco River LP and Opco and Blanco River GP shall be bound by the Blanco River LP Agreement and continue as limited partner and general partner, as applicable, with respect to the portion of its respective interest in Blanco River LP.

2.5 Distribution of General Partner, Partnership Limited Partner Interests and DevCo LP Interests . Opco hereby distributes to NBL Midstream (i) its 100% member interest in the General Partner, (ii) its 99% limited partner interest in the Partnership and (iii) the DevCo LP Interests; and NBL Midstream hereby accepts such general partner interest, limited partner interests and DevCo LP Interests, and NBL Midstream shall be bound by the limited liability company agreement of the General Partner, the LP Agreement and the applicable agreement of limited partnership of each of the DevCos, as applicable, and continue as sole member or limited partner with respect to the portion of its respective interest in each such DevCo, as applicable, until the completion of the transactions set forth in Section 2.5 .

Each of the following transactions set forth in Sections 2.6 through 2.10 shall be completed as of the Effective Time in the order set forth herein:

2.6 Redemption of the Original General Partner Interest . The General Partner and NBL Midstream amend and restate the Agreement of Limited Partnership of the Partnership, dated as of December 23, 2014, and, upon the execution of the LP Agreement, dated as of the Closing Date, the General Partner will be issued a non-economic general partner interest in the Partnership. The Partnership hereby redeems the Original General Partner Interest acquired by the General Partner upon formation of the Partnership, and hereby refunds and distributes to the General Partner $20, along with any interest or other profit that resulted from the investment or other use of such initial contribution.

 

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2.7 Contribution of Opco to the Partnership . NBL Midstream hereby contributes to the Partnership all right, title and interest in and to all of the outstanding limited liability company interests in Opco (the “ Opco Interests ”) in exchange for (a) [                    ] Common Units representing an approximate [    ]% limited partner interest (based on an aggregate of [                    ] Common Units and Subordinated Units to be outstanding after the completion of the Offering) in the Partnership (the “ Sponsor Common Units ”), (b) [                    ] Subordinated Units representing a [    ]% limited partner interest (based on an aggregate of [                    ] Common Units and Subordinated Units to be outstanding after the completion of the Offering) in the Partnership (the “ Sponsor Subordinated Units ”), (c) all of the limited partner interests in the Partnership classified as “Incentive Distribution Rights” under the LP Agreement and (d) the right to receive a cash distribution from the Partnership in the amount of approximately $[        ] million from the net proceeds from the sale of the Firm Units and the Option Units in the Offering, and the Partnership hereby accepts such Opco Interests as a capital contribution from NBL Midstream. Upon NBL Midstream’s contribution of such Opco Interests to the Partnership, (i) the Partnership shall be the sole member of Opco, (ii) NBL Midstream shall and does hereby cease to be a member of Opco and shall thereupon cease to have or exercise any right or power as a member of Opco and (iii) Opco shall be and hereby is continued without dissolution.

2.8 Public Cash Contribution . The Parties acknowledge that, in connection with the Offering, public investors, through the Underwriters, shall make a capital contribution to the Partnership of $[        ] million in cash (the “ IPO Proceeds ”) in exchange for [                    ] Common Units (the “ Firm Units ”) representing an aggregate [    ]% limited partner interest in the Partnership, and new limited partners are being admitted to the Partnership in connection therewith.

2.9 Payment of Transaction Expenses by the Partnership and Distribution of Proceeds by the Partnership . The Parties acknowledge (a) the payment by the Partnership, in connection with the closing of the Offering, of transaction expenses of approximately $[        ] million (the “ Transaction Expenses ”), excluding underwriting discounts of $[        ] in the aggregate but including a structuring fee of [    ]% of the gross proceeds of the Offering payable to certain of the Underwriters (the “ Structuring Fee ”), and (b) the distribution by the Partnership to NBL Midstream of $[        ], and, if applicable, when available, the net proceeds from the exercise of the Underwriters’ Over-Allotment Option.

2.10 Redemption of the Original Limited Partner Interest from the Partnership and Return of Initial Capital Contribution . The Partnership hereby redeems the Original Limited Partner Interest acquired by NBL Midstream in Section 2.5 and hereby refunds and distributes to NBL Midstream $980, made in connection with the formation of the Partnership, along with any interest or other profit that resulted from the investment or other use of such initial contribution.

 

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ARTICLE III

EXERCISE OF OVER-ALLOTMENT OPTION

If the Over-Allotment Option is exercised in whole or in part, the Underwriters will contribute additional cash to the Partnership in exchange for up to an additional [                    ] Common Units representing an aggregate [    ]% limited partner interest in the Partnership (the “ Option Units ”) at the Offering price per Common Unit set forth in the Registration Statement, net of underwriting discounts and the Structuring Fee. Upon any exercise of the Over-Allotment Option, the Partnership will distribute to NBL Midstream any net cash proceeds from the sale of such Option Units. Upon the expiration of the Option Period, any Option Units not purchased by the Underwriters pursuant to the Underwriting Agreement will be issued as a Deferred Issuance to NBL Midstream as part of the contribution transactions described in Section 2.8 .

ARTICLE IV

FURTHER ASSURANCES

From time to time after the date hereof, and without any further consideration, each of the Parties shall execute, acknowledge and deliver all such additional instruments, notices and other documents, and will do all such other acts and things, all in accordance with applicable law, as may be necessary or appropriate to more fully and effectively carry out the purposes and intent of this Agreement. Without limiting the generality of the foregoing, the Parties acknowledge that the Parties have used their good faith efforts to identify all of the assets contributed to the DevCos and NBLMH as required in connection with this Agreement, including in the recitals hereto. However, due to the age of some of the assets and the difficulties in locating appropriate data with respect to some of the assets, it is possible that assets intended to be contributed ultimately to the DevCos and NBLMH were not identified and therefore are not included in the assets described herein. It is the express intent of the Parties that the DevCos and NBLMH own all assets necessary to operate the assets that are identified in this Agreement, including in the recitals hereto. To the extent that any assets were not identified but are necessary to the operation of the assets that are so identified in this Agreement, including in the recitals hereto, then the intent of the Parties is that all such unidentified assets are intended to be conveyed to the DevCos and NBLMH pursuant to this Agreement. If any such assets are identified at a later date, the Parties shall take all appropriate action required in order to convey such assets to any applicable DevCo or NBLMH. Further, to the extent that any assets that are conveyed to any DevCo or NBLMH hereunder are later identified by the Parties as assets that the Parties did not intend to convey to any DevCo or NBLMH, the Parties shall take all appropriate action required to convey such assets to the appropriate Noble Entity.

Without limiting any liabilities or remedies of the Parties applicable under this Agreement or any other agreements, if and to the extent that the valid, complete and perfected transfer or assignment of any assets by any Party to any other Party or the acquisition of any assets from any Party by any other Party would be a violation of applicable law or require any additional consents, approvals or notifications in connection with the transfer of such that have not been obtained or made by the Effective Time, then, unless the Parties shall otherwise mutually determine, the transfer or assignment of such assets shall be automatically deemed deferred and any such purported transfer or assignment shall be null and void until such time as

 

8


all legal impediments are removed or such consents, approvals and notifications have been obtained or made. Notwithstanding the foregoing, in such event the Parties shall (a) hold such assets for the benefit of the applicable Party, (b) not transfer or assign such assets, in whole or in part, other than with the prior consent of the intended transferee, and (c) use their respective reasonable best efforts to assure that the intended transferee receives all of the benefits of the assets attempted to have been transferred to such member until such time as the attempted transfer is complete, and the intended transferee shall bear all costs associated with such assets (except costs associated with the attempted transfer or perfecting such transfer, and subject to offset of any benefits of the assets not received by the intended transferee against associated costs incurred by the Parties) as if the transfer had been valid and complete.

ARTICLE V

ORDER OF COMPLETION AND EFFECTIVENESS OF TRANSACTIONS;

LIMITATIONS

5.1 Order of Completion of Transactions . The transactions provided for in Articles II shall be completed in the order and at the times set forth in Articles II .

5.2 Effectiveness of Transactions . Notwithstanding anything contained in this Agreement to the contrary, none of the provisions of Article II shall be operative or have any effect until at least the Effective Time, at which respective time all such applicable provisions shall be effective and operative in accordance with Section 5.1 without further action by any Party.

5.3 Limitations . Distributions made or to be made hereunder shall be subject to the Delaware Partnership Act and the Delaware Limited Liability Company Act, as applicable, notwithstanding any other provision of this Agreement.

ARTICLE VI

MISCELLANEOUS

6.1 Costs . Except for the Transaction Expenses set forth in Section 2.10 , Noble shall pay all expenses, fees and costs, including, but not limited to, all sales, use and similar taxes arising out of the contributions, distributions, conveyances and deliveries to be made under Article II and shall pay all documentary, filing and recording, transfer, deed and conveyance taxes and fees required in connection therewith. In addition, Noble shall be responsible for all costs, liabilities and expenses (including court costs and reasonable attorneys’ fees) incurred in connection with the implementation of any conveyance or delivery pursuant to Article IV (to the extent related to any of the contributions, distributions, conveyances and deliveries to be made under Article II ).

6.2 Headings; References; Interpretation . All Article and Section headings in this Agreement are for convenience only and shall not be deemed to control or affect the meaning or construction of any of the provisions hereof. The words “hereof,” “herein” and “hereunder” and words of similar import, when used in this Agreement, shall refer to this Agreement as a whole, and not to any particular provision of this Agreement. All references herein to Articles and Sections shall, unless the context requires a different construction, be deemed to be references to the Articles and Sections of this Agreement. All personal pronouns used in this Agreement,

 

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whether used in the masculine, feminine or neuter gender, shall include all other genders, and the singular shall include the plural and vice versa. The use herein of the word “including” following any general statement, term or matter shall not be construed to limit such statement, term or matter to the specific items or matters set forth immediately following such word or to similar items or matters, whether or not non-limiting language (such as “without limitation,” “but not limited to” or other words of similar import) is used with reference thereto, but rather shall be deemed to refer to all other items or matters that could reasonably fall within the broadest possible scope of such general statement, term or matter.

6.3 Successors and Assigns . This Agreement shall be binding upon and inure to the benefit of the Parties and their respective successors and permitted assigns.

6.4 No Third Party Rights . The provisions of this Agreement are intended to bind the Parties as to each other and are not intended to and do not create rights in any other person or confer upon any other person any benefits, rights or remedies, and no person is or is intended to be a third party beneficiary of any of the provisions of this Agreement.

6.5 Counterparts . This Agreement may be executed in any number of counterparts with the same effect as if all Parties had signed the same document. All counterparts shall be construed together and shall constitute one and the same instrument.

6.6 Applicable Law . This Agreement shall be construed in accordance with and governed by the laws of the State of Delaware, without regard to the principles of conflicts of law. EACH OF THE PARTIES HERETO AGREES THAT THIS AGREEMENT INVOLVES AT LEAST U.S. $100,000.00 AND THAT THIS AGREEMENT HAS BEEN ENTERED INTO IN EXPRESS RELIANCE UPON 6 Del. C. § 2708. EACH OF THE PARTIES HERETO IRREVOCABLY AND UNCONDITIONALLY AGREES (i) TO BE SUBJECT TO THE JURISDICTION OF THE COURTS OF THE STATE OF DELAWARE AND OF THE FEDERAL COURTS SITTING IN THE STATE OF DELAWARE, AND (ii) TO THE EXTENT SUCH PARTY IS NOT OTHERWISE SUBJECT TO SERVICE OF PROCESS IN THE STATE OF DELAWARE, TO APPOINT AND MAINTAIN AN AGENT IN THE STATE OF DELAWARE AS SUCH PARTY’S AGENT FOR ACCEPTANCE OF LEGAL PROCESS AND TO NOTIFY THE OTHER PARTIES OF THE NAME AND ADDRESS OF SUCH AGENT.

6.7 Severability . If any of the provisions of this Agreement are held by any court of competent jurisdiction to contravene, or to be invalid under, the laws of any political body having jurisdiction over the subject matter hereof, such contravention or invalidity shall not invalidate the entire Agreement. Instead, this Agreement shall be construed as if it did not contain the particular provision or provisions held to be invalid and an equitable adjustment shall be made and necessary provision added so as to give effect to the intention of the Parties as expressed in this Agreement at the time of execution of this Agreement.

6.8 Amendment or Modification . This Agreement may be amended or modified from time to time only by the written agreement of all the Parties. Each such instrument shall be reduced to writing and shall be designated on its face as an amendment to this Agreement.

 

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6.9 Integration . This Agreement and the instruments referenced herein and in the exhibits attached hereto supersede all previous understandings or agreements among the parties, whether oral or written, with respect to the subject matter of this Agreement and such instruments. This Agreement and such instruments contain the entire understanding of the Parties with respect to the subject matter hereof and thereof. There are no unwritten oral agreements between the parties. No understanding, representation, promise or agreement, whether oral or written, is intended to be or shall be included in or from part of this Agreement unless it is contained in a written amendment hereto executed by the parties hereto after the date of this Agreement.

6.10 Deed; Bill of Sale; Assignment . To the extent required and permitted by applicable law, this Agreement shall also constitute a “deed,” “bill of sale” or “assignment” of the assets and interests referenced herein.

[Remainder of page intentionally left blank]

 

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IN WITNESS WHEREOF, the Parties to this Agreement have caused it to be duly executed as of the date first above written.

 

NOBLE MIDSTREAM PARTNERS LP

  By: Noble Midstream GP LLC, its general partner
 

            By:

 

 

    Terry R. Gerhart
    Chief Executive Officer

 

Signature Page to Contribution, Conveyance and Assumption Agreement


NOBLE MIDSTREAM GP LLC

By:  

 

Name:   Terry R. Gerhart
Title:   Chief Executive Officer

 

Signature Page to Contribution, Conveyance and Assumption Agreement


NOBLE MIDSTREAM SERVICES, LLC

By:  

 

Name:   Terry R. Gerhart
Title:   Chief Executive Officer

 

Signature Page to Contribution, Conveyance and Assumption Agreement


NBL MIDSTREAM, LLC

By:  

 

Name:   Charles J. Rimer
Title:   President

 

Signature Page to Contribution, Conveyance and Assumption Agreement


NBL MIDSTREAM HOLDINGS, LLC

By:  

 

Name:   Charles J. Rimer
Title:   President

 

Signature Page to Contribution, Conveyance and Assumption Agreement


COLORADO RIVER DEVCO GP LLC

  By: Noble Midstream Services, LLC, its sole member
 

            By:

 

 

    Terry R. Gerhart
    Chief Executive Officer

 

Signature Page to Contribution, Conveyance and Assumption Agreement


GREEN RIVER DEVCO GP LLC

  By: Noble Midstream Services, LLC, its sole member
 

            By:

 

 

    Terry R. Gerhart
    Chief Executive Officer

 

Signature Page to Contribution, Conveyance and Assumption Agreement


GUNNISON RIVER DEVCO GP LLC

  By: Noble Midstream Services, LLC, its sole member
 

            By:

 

 

    Terry R. Gerhart
    Chief Executive Officer

 

Signature Page to Contribution, Conveyance and Assumption Agreement


LARAMIE RIVER DEVCO GP LLC

  By: Noble Midstream Services, LLC, its sole member
 

            By:

 

 

    Terry R. Gerhart
    Chief Executive Officer

 

Signature Page to Contribution, Conveyance and Assumption Agreement


SAN JUAN RIVER DEVCO GP LLC

  By: Noble Midstream Services, LLC, its sole member
 

            By:

 

 

    Terry R. Gerhart
    Chief Executive Officer

 

Signature Page to Contribution, Conveyance and Assumption Agreement


BLANCO RIVER DEVCO LP

  By: Blanco River DevCo GP, LLC, its general partner
  By: Noble Midstream Services, LLC, its sole member
 

            By:

 

 

    Terry R. Gerhart
    Chief Executive Officer

 

Signature Page to Contribution, Conveyance and Assumption Agreement


BLANCO RIVER DEVCO GP LLC

  By: Noble Midstream Services, LLC, its sole member
 

            By:

 

 

    Terry R. Gerhart
    Chief Executive Officer

 

Signature Page to Contribution, Conveyance and Assumption Agreement


Exhibit A

Integrated Development Plan Areas

East Pony IDP

The East Pony IDP describes an area in Weld County, Colorado covering the following Sections, Townships and Ranges:

 

Township

  

Range

  

Section(s)

T9N

   R58W    ALL

T9N

   R59W    ALL

T8N

   R59W    ALL

Mustang IDP

The Mustang IDP describes an area in Weld County, Colorado covering the following Sections, Townships and Ranges:

 

Township

  

Range

  

Section(s)

T4N    R64W    1-3, 10-15, 22-27, 32-36
T4N    R63W    2-11, 14-23, 26-35
T3N    R63W    4-9, 16-21, 28-33
T3N    R64W    ALL
T3N    R65W    1-3, 10-15, 22-27, 34-36
T2N    R64W    ALL
T2N    R63W    3-9, 16-21, 28-33
T3N    R65W    21, 28

Wells Ranch IDP

The Wells Ranch IDP describes an area in Weld County, Colorado covering the following Sections, Townships and Ranges:

 

Township

  

Range

  

Section(s)

T7N    R64W    31-36
T7N    R63W    31-36
T7N    R62W    31
T6N    R64W    ALL
T6N    R63W    ALL
T6N    R62W    2-11, 14-23, 26-35
T5N    R62W    2-11, 14-23
T5N    R63W    ALL
T5N    R64W    1-6, 10-15, 22-27, 34-36


Northern Colorado

The phrase “Northern Colorado” refers to the East Pony IDP together with the following areas in Weld County, Colorado, covering the following Sections, Townships and Ranges:

 

Township

  

Range

  

Section(s)

T7N    59W    ALL
T7N    62W    ALL (other than 31)
T7N    63W    ALL
T7N    64W    ALL
T8N    63W    ALL
T8N    R58W    ALL
T8N    R60W    ALL
T8N    R61W    ALL
T8N    R62W    ALL
T9N    R60W    ALL
T9N    R61W    ALL
10N    58W    S/2
10N    60W    ALL
10N    61W    ALL

Exhibit 10.3

FORM OF

OMNIBUS AGREEMENT

by and between

NOBLE ENERGY, INC.

NOBLE ENERGY SERVICES, INC.

NBL MIDSTREAM, LLC

NOBLE MIDSTREAM SERVICES, LLC

NOBLE MIDSTREAM GP LLC

and

NOBLE MIDSTREAM PARTNERS LP

dated as of

[                ], 2016


TABLE OF CONTENTS

 

             Page  

ARTICLE I DEFINITIONS

     1   
  1.1   Definitions      1   
  1.2   Rules of Construction      8   

ARTICLE II INDEMNIFICATION

     9   
  2.1   Environmental Indemnification      9   
  2.2   Right-of-Way Indemnification.      10   
  2.3   Additional Indemnification.      11   
  2.4   Indemnification Procedures      12   
  2.5   Limitations Regarding Indemnification      14   
  2.6   Exclusive Remedy      14   

ARTICLE III SERVICES; REIMBURSEMENT

     14   
  3.1   General and Administrative Services      14   
  3.2   Administrative Fee      15   
  3.3   Reimbursement of General and Administrative Expenses.      16   
  3.4   Transition Services.      16   

ARTICLE IV RIGHT OF FIRST REFUSAL AND RIGHT OF FIRST OFFER

     17   
  4.1   Right of First Refusal to Purchase Certain Assets      17   
  4.2   ROFR Procedures.      17   
  4.3   Right of First Offer.      22   
  4.4   ROFO Procedures.      22   

ARTICLE V ACCESS RIGHTS

     24   
  5.1   Access Rights.      24   

ARTICLE VI MISCELLANEOUS

     24   
  6.1   Confidentiality      24   
  6.2   Choice of Law; Mediation; Submission to Jurisdiction      25   
  6.3   Entire Agreement      26   
  6.4   Termination of Agreement      26   
  6.5   Amendment or Modification      27   
  6.6   Assignment      27   
  6.7   Counterparts      27   
  6.8   Severability      27   
  6.9   Further Assurances      27   
  6.10   Rights of Limited Partners      27   

 

SCHEDULES:

  
Schedule A    ROFR Acreage
Schedule B    General and Administrative Services
Schedule C    Reserved
Schedule D    Reserved
Schedule E    Property Access Rights

 

i


OMNIBUS AGREEMENT

This OMNIBUS AGREEMENT (as amended, modified, supplemented or restated from time to time in accordance with the terms hereof, this “Agreement ”) is entered into on, and effective as of, the Closing Date (as defined herein) by and between Noble Energy, Inc., a Delaware corporation (“ Noble ”), Noble Energy Services, Inc., a Delaware corporation (“ NESI ”), NBL Midstream, LLC, a Delaware limited liability company (“ NBL Midstream ”), Noble Midstream Services, LLC, a Delaware limited liability company (“ OpCo ”), Noble Midstream GP LLC, a Delaware limited liability company (the “ General Partner ”), and Noble Midstream Partners LP, a Delaware limited partnership (the “ Partnership ” and, together with Noble, NBL Midstream, OpCo and the General Partner, the “ Parties ” and each a “ Party ”).

RECITALS

1. Capitalized terms used in this Agreement are defined in Article I .

2. The Parties desire by their execution of this Agreement to evidence their understanding, as more fully set forth in Article II , with respect to certain indemnification obligations of the Parties to each other.

3. The Parties desire by their execution of this Agreement to evidence their understanding, as more fully set forth in Article III , with respect to (i) the amount to be paid by the Partnership for general and administrative services relating to operating the Partnership’s business to be performed by Noble and its Affiliates (including the General Partner) for and on behalf of the Partnership Group, (ii) the reimbursement of expenses incurred by Noble and its Affiliates on behalf of the Partnership Group and (iii) the reimbursement of costs incurred by Noble and its Affiliates on behalf of the Partnership Group for certain transition services.

4. The Parties desire by their execution of this Agreement to evidence their understanding, as more fully set forth in Article IV , with respect to the amendment and restatement of the Partnership Group’s right of first refusal to purchase the ROFR Assets and the right of first offer to purchase the ROFO Equity.

5. The Parties desire by their execution of this Agreement to evidence their understanding, as more fully set forth in  Article V , with respect to the amendment and restatement of the Partnership Group’s right to access and use certain items of real and personal property owned by Noble.

In consideration of the premises and the covenants, conditions and agreements contained herein, and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the Parties agree as follows:

ARTICLE I

DEFINITIONS

1.1 Definitions . As used in this Agreement, the following terms shall have the meanings set forth below:

 

1


Acceptance Deadline ” means the First ROFR Asset Acceptance Deadline, the Second ROFR Asset Acceptance Deadline or the ROFR Services Acceptance Deadline, as applicable.

Administrative Fee ” is defined in Section 3.2(a) .

Affiliate ” is defined in the Partnership Agreement; provided that, for the purposes of this Agreement, any Person that is a Partnership Group Member shall be deemed not an Affiliate of Noble and its Subsidiaries (other than the Partnership Group).

Agreement ” is defined in the introductory paragraph of this Agreement.

Closing Date ” means the closing date of the Partnership’s IPO.

Confidential Information ” means (1) all information contained in (and the existence of) each Services Notice and Disposition Notice and (2) any proprietary or confidential information that is competitively sensitive material or otherwise of value to a Party or its Affiliates and not generally known to the public, including trade secrets, scientific or technical information, design, invention, process, procedure, formula, improvements, product planning information, marketing strategies, financial information, information regarding operations, consumer and/or customer relationships, consumer and/or customer identities and profiles, sales estimates, business plans, and internal performance results relating to the past, present or future business activities of a Party or its Affiliates and the consumers, customers, clients and suppliers of any of the foregoing. Confidential Information includes such information as may be contained in or embodied by documents, substances, engineering and laboratory notebooks, reports, data, specifications, computer source code and object code, flow charts, databases, drawings, pilot plants or demonstration or operating facilities, diagrams, specifications, bills of material, equipment, prototypes and models, and any other tangible manifestation (including data in computer or other digital format) of the foregoing; provided, however, that Confidential Information does not include information that a Receiving Party can show (a) has been published or has otherwise become available to the general public as part of the public domain without breach of this Agreement, (b) has been furnished or made known to the Receiving Party without any obligation to keep it confidential by a Third Party under circumstances which are not known to the Receiving Party to involve a breach of the Third Party’s obligations to a Party or (c) was developed independently of information furnished or made available to the Receiving Party as contemplated under this Agreement.

Contribution Agreement ” means the Contribution, Conveyance and Assumption Agreement, dated as of the Closing Date, by and between the General Partner, the Partnership, Noble, NBL Midstream, NBL Midsteam Holdings, LLC and the other Partnership Group Members party thereto, with the additional conveyance documents and instruments contemplated or referenced thereunder, as such may be amended, supplemented or restated from time to time.

Covered Environmental Losses ” is defined in Section 2.1(a) .

Covered Property Losses ” is defined in Section 2.2 .

Deductible ” is defined in Section 2.5(a) .

 

2


Disclosing Party ” is defined in Section 6.1(a) .

Disposition Notice ” is defined in Section 4.2(a) .

Environmental Laws ” means all federal, state and local laws, statutes, rules, regulations, orders, judgments, ordinances, codes, injunctions, decrees, Environmental Permits and other legally enforceable requirements and rules of common law now or hereinafter in effect relating to (a) pollution or protection of human health, natural resources, wildlife and the environment or workplace health or safety, including the federal Comprehensive Environmental Response, Compensation, and Liability Act of 1980, as amended, 42 U.S.C. §§9601 et seq. , the Resource Conservation and Recovery Act of 1976, as amended, 42 U.S.C. §§6901 et seq. , the Clean Air Act, as amended, 42 U.S.C. §§7401 et seq. , the Federal Water Pollution Control Act, as amended, 33 U.S.C. §§1251 et seq. , the Toxic Substances Control Act, as amended, 15 U.S.C. §§2601 et seq. , the Oil Pollution Act of 1990, 33 U.S.C. §§2701 et seq. , the Safe Drinking Water Act of 1974, as amended, 42 U.S.C. §§300f et seq. , the Hazardous Materials Transportation Act of 1994, as amended, 49 U.S.C. §§5101 et seq. , and other environmental conservation and protection laws and the Occupational Safety and Health Act of 1970, 29 U.S.C. §§651 et seq. , and the regulations promulgated pursuant thereto, and any state or local counterparts, each as amended from time to time and (b) the generation, manufacture, processing, distribution, use, treatment, storage, transport or handling of any Hazardous Substances.

Environmental Permit ” means any permit, approval, identification number, license, registration, certification, consent, exemption, variance or other authorization required under or issued pursuant to any applicable Environmental Law, including applications for renewal of such permits in which the application allows for continued operation under the terms of an expired permit.

First ROFR Asset Acceptance Deadline ” is defined in Section 4.2(a) .

General and Administrative Services ” is defined in Section 3.1(a) .

General Partner ” is defined in the introductory paragraph of this Agreement.

Governmental Authority ” means any federal, state, tribal, foreign or local governmental entity, authority, department, court or agency, including any political subdivision thereof, exercising, or entitled to exercise, any administrative, executive, judicial, legislative, police, regulatory or taxing authority or power of any nature, and including any arbitrating body, commission or quasi-governmental authority or self-regulating organization of competent authority exercising or enlisted to exercise similar power or authority.

Hazardous Substance ” means (a) any substance, whether solid, liquid, gaseous, semi-solid, or any combination thereof, that is designated, defined or classified as a hazardous waste, solid waste, hazardous material, pollutant, contaminant or toxic or hazardous substance, or terms of similar meaning, or that is otherwise regulated under any Environmental Law, including any hazardous substance as defined under the Comprehensive Environmental Response, Compensation, and Liability Act, as amended, and including asbestos and lead-containing paints or coatings, radioactive materials, polychlorinated biphenyls and greenhouse gases and (b) petroleum, oil, gasoline, natural gas, fuel oil, motor oil, waste oil, diesel fuel, jet fuel and other refined petroleum hydrocarbons.

 

3


Identification Deadline ” means the third anniversary of the Closing Date.

Indemnified Party ” means the Party entitled to indemnification in accordance with Article II .

Indemnifying Party ” means the Party from whom indemnification may be sought in accordance with Article II .

IPO ” means the initial public offering of common units representing limited partner interests in the Partnership.

Limited Partner ” is defined in the Partnership Agreement.

Losses ” means any losses, damages, liabilities, claims, demands, causes of action, judgments, settlements, fines, penalties, costs and expenses (including court costs and reasonable attorney’s and expert’s fees) of any and every kind or character, known or unknown, fixed or contingent.

Mediation Notice ” is defined in Section 6.2(b) .

NBL Midstream ” is defined in the introductory paragraph of this Agreement.

NEI Invoice Delivery Date ” is defined in Section 3.2(d)(i) .

NESI ” is defined in the introductory paragraph of this Agreement.

Noble ” is defined in the introductory paragraph of this Agreement. The term “Noble” shall include any successor by merger to the ultimate parent company of Noble Energy Group.

N oble Energy Group ” means Noble and all of its Subsidiaries (other than the General Partner and the Partnership Group).

Noble Energy Group Member ” means any member of the Noble Energy Group.

Offer Price ” is defined in Section   4.2(a) .

OpCo ” is defined in the introductory paragraph of this Agreement.

Operational Services and Secondment Agreement ” means that certain Operational Services Agreement, dated as of the Closing Date, by and among the Partnership, the General Partner, Noble, NESI and the other Persons party thereto from time to time, as such agreement may be amended, supplemented or restated from time to time.

Original Lease ” is defined in Section 2.3(c) .

Partnership ” is defined in the introductory paragraph of this Agreement.

 

4


Partnership Agreement ” means the First Amended and Restated Agreement of Limited Partnership of the Partnership, dated as of the Closing Date, as it may be amended, modified, supplemented or restated from time to time in accordance with the terms thereof.

Partnership Assets ” means all assets, or portions thereof, conveyed, contributed or otherwise Transferred or intended to be conveyed, contributed or otherwise Transferred pursuant to the Contribution Agreement to any Partnership Group Member, or owned by, leased by or necessary for the operation of the business, properties or assets of any Partnership Group Member as of the Closing Date.

Partnership Change of Control ” means Noble ceases to possess, directly or indirectly, the power to direct or cause the direction of the management and policies of the General Partner, whether through ownership of voting securities, by contract or otherwise.

Partnership Group ” means the Partnership and its consolidated Subsidiaries.

Partnership Group Member ” means any member of the Partnership Group.

Partnership Invoice Payment Date ” is defined in Section 3.2(d)(ii) .

Partnership Interest ” is defined in the Partnership Agreement.

Partnership Parties ” has the meaning given to such term in the Operational Services and Secondment Agreement.

Party ” and “ Parties ” are defined in the introductory paragraph of this Agreement.

Person ” means an individual or a corporation, firm, limited liability company, partnership, joint venture, trust, unincorporated organization, association, government agency or political subdivision thereof or other entity.

Property Access Rights ” means the access rights of the Partnership Group on certain real and personal property retained by Noble following the consummation of the IPO, such real and personal property set forth on Schedule E .

Proposed Provider ” is defined in Section 4.2(b) .

Proposed ROFO Transaction ” is defined in Section 4.4(a).

Proposed Service Acreage ” is defined in Section 4.2(b) .

Proposed Services ” is defined in Section 4.2(b) .

Proposed Transferee ” is defined in Section 4.2(a) .

Receiving Party ” is defined in Section 6.1(a) .

Registration Statement ” means the Registration Statement on Form S-1 (File No. 333-207560) filed by the Partnership and relating to the IPO.

 

5


Remaining Vendor Contracts ” means each contract between a Noble Energy Group Member and a Third Party vendor of goods or services that (i) is used or useful in connection with the Partnership Group’s assets and the services provided under the Revenue Agreements and (ii) has not prior to the Closing Date been amended, assigned or otherwise modified to cause a Partnership Group Member to be a party to such contract with the applicable vendor.

Representative ” is defined in Section 6.1(a) .

Retained Assets ” means all assets, or portions thereof owned by any of the members of the Noble Energy Group that were not directly or indirectly conveyed, contributed or otherwise Transferred to the Partnership Group in connection with the IPO.

Revenue Agreement ” means, collectively, the following, as the same may be amended, amended and restated, supplemented or otherwise modified, including by the entry into new or additional Agreement Addenda in respect of any of the following:

 

    those certain Second Amended and Restated Fresh Water Services Agreements, dated effective as of March 31, 2016, consisting of the Second Amended and Restated Agreement Terms and Conditions Relating to Fresh Water Services last updated as of March 31, 2016, and each Second Amended and Restated Agreement Addendum thereto executed from time to time by Noble or its Affiliates and OpCo or one or more of its Subsidiaries;

 

    those certain Second Amended and Restated Gas Gathering Agreements, dated effective as of March 31, 2016, consisting of the Second Amended and Restated Agreement Terms and Conditions Relating to Gas Gathering Services last updated as of March 31, 2016, and each Second Amended and Restated Agreement Addendum thereto executed from time to time by Noble or its Affiliates and OpCo or one or more of its Subsidiaries;

 

    those certain Second Amended and Restated Crude Oil Gathering Agreements, dated effective as of March 31, 2016, consisting of the Second Amended and Restated Agreement Terms and Conditions Relating to Crude Oil Gathering Services last updated as of March 31, 2016, and each Second Amended and Restated Agreement Addendum thereto executed from time to time by Noble or its Affiliates and OpCo or one or more of its Subsidiaries;

 

    those certain Third Amended and Restated Crude Oil Treating Agreements, dated effective as of March 31, 2016, consisting of the Third Amended and Restated Agreement Terms and Conditions Relating to Crude Oil Treating Services last updated as of March 31, 2016, and each Third Amended and Restated Agreement Addendum thereto executed from time to time by Noble or its Affiliates and OpCo or one or more of its Subsidiaries;

 

   

those certain Second Amended and Restated Produced Water Services Agreements, dated effective as of March 31, 2016, consisting of the Second Amended and Restated Agreement Terms and Conditions Relating to Produced

 

6


 

Water Services last updated as of March 31, 2016, and each Second Amended and Restated Agreement Addendum thereto executed from time to time by Noble or its Affiliates and OpCo or one or more of its Subsidiaries;

 

    those certain Texas Crude Oil Gathering Agreements, dated effective as of September 1, 2016, consisting of the Texas Agreement Terms and Conditions Relating to Crude Oil Gathering last updated as of September 1, 2016, and each Agreement Addendum thereto executed from time to time by Rosetta Resources Operating LP or its Affiliates and OpCo or one or more of its Subsidiaries; and

 

    those certain Texas Produced Water Services Agreements, dated effective as of September 1, 2016, consisting of the Texas Agreement Terms and Conditions Relating to Produced Water Services last updated as of September 1, 2016, and each Agreement Addendum thereto executed from time to time by Rosetta Resources Operating LP or its Affiliates and OpCo or one or more of its Subsidiaries.

Rights Termination Date ” means the earliest to occur of (a) fifteen years following the Closing Date, (b) a Partnership Change of Control or (c) a termination of this Agreement pursuant to Section 6.4 .

ROFO Equity ” means any equity interests that a Noble Energy Group Member holds in a Subsidiary of the Partnership. For the avoidance of doubt, as of the date of this Agreement, all ROFO Equity is held by NBL Midstream.

ROFO Notice ” is defined in Section 4.4(a).

ROFO Response ” is defined in Section 4.4(a).

ROFR Acreage ” means, with respect to oil and gas assets, (i) all leasehold acreage and fee acreage currently owned by Noble Energy Group in the areas of Dimmit, Reeves and Webb Counties, Texas to the extent described on Schedule A , (ii) all leasehold acreage and fee acreage currently owned by Noble Energy Group in Weld County, Colorado and the Utica Shale in Pennsylvania and West Virginia and (iii) all leasehold acreage and fee acreage in the future acquired by Noble Energy Group onshore in the continental United States of America outside of the Marcellus Shale in the northeastern United States; provided that any acreage specifically released in a written instrument signed by the Partnership subsequent to the date hereof are excluded from the definition of ROFR Acreage.

ROFR Assets ” means the ownership interests of a Noble Energy Group Member in any assets currently owned or in the future developed or acquired that satisfy all of the following criterion: such assets are (i) owned by a Noble Energy Group Member at the time of the proposed Transfer for the purpose of providing ROFR Services, (ii) are located on ROFR Acreage, (iii) not used by any Noble Energy Group Member at the time of the proposed Transfer to provide services to or with respect to production from the Marcellus formation and (iv) are of a type that are useful in the provision of ROFR Services.

ROFR Notice ” means a Disposition Notice or a Services Notice, as applicable.

 

7


ROFR Services ” means (1) those midstream services that are of the type covered by a Revenue Agreement, as of the Closing Date, which, for the avoidance of doubt, include oil gathering, gas gathering, produced water services, fresh water services and oil treating and (2) services of a type provided at gas processing plants and LNG facilities.

ROFR Services Acceptance Deadline ” is defined in Section 4.2(b) .

Sale Assets ” is defined in Section 4.2(a) .

Second ROFR Asset Acceptance Deadline ” is defined in Section   4.2(a) .

Service Rate ” is defined in Section   4.2(b) .

Services Contract ” is defined in Section   4.2(b) .

Services Notice ” is defined in Section   4.2(b) .

Subsidiary ” is defined in the Partnership Agreement.

Third Party ” means a Person that is not a Partnership Group Member, and additionally, for the purposes of Article IV , a Person that is not a Noble Energy Group Member.

Transfer ” including the correlative terms “ Transferring ” or “ Transferred ” means (i) any direct or indirect transfer, assignment, sale, gift, pledge, hypothecation or other encumbrance, or any other disposition (whether voluntary, involuntary or by operation of law) and (ii) any dedication of services and any commitment or similar contractual arrangement that would have the effect of excluding the Partnership from the opportunity to provide the applicable services. For the avoidance of doubt, a Transfer of equity interests in an entity that holds a ROFR Asset shall constitute a Transfer.

Wells Ranch CGF Indemnity ” is defined in Section 2.3(c) .

Wells Ranch CGF Surface Lease ” is defined in Section 2.3(c) .

1.2 Rules of Construction . Unless expressly provided for elsewhere in this Agreement, this Agreement shall be interpreted in accordance with the following provisions:

(a) If a word or phrase is defined, its other grammatical forms have a corresponding meaning.

(b) The headings contained in this Agreement are for reference purposes only and shall not affect the meaning or interpretation of this Agreement.

(c) A reference to any Party to this Agreement or another agreement or document includes such Party’s successors and assigns.

(d) The words “hereof,” “herein” and “hereunder” and words of similar import when used in this Agreement shall refer to this Agreement as a whole and not to any particular provision of this Agreement, and article, section, subsection and schedule references are to this Agreement unless otherwise specified.

 

8


(e) The words “including,” “include,” “includes” and all variations thereof shall mean “including without limitation.”

(f) The word “or” shall have the inclusive meaning represented by the phrase “and/or.”

(g) The words “shall” and “will” have equal force and effect.

(h) The schedules identified in this Agreement are incorporated herein by reference and made a part of this Agreement.

(i) References to “$” or to “dollars” shall mean the lawful currency of the United States of America.

ARTICLE II

INDEMNIFICATION

2.1 Environmental Indemnification .

(a) To the fullest extent permitted by law, Noble shall indemnify, defend and hold harmless each Partnership Group Member from and against any Losses suffered or incurred by such Partnership Group Member, directly or indirectly, by reason of or arising out of:

(i) any violation of Environmental Laws associated with or arising from the ownership or operation of the Partnership Assets prior to the Closing Date;

(ii) any environmental event, condition or matter associated with or arising from the ownership or operation of the Partnership Assets as in effect prior to the Closing Date (including the presence of Hazardous Substances on, under, about or migrating to or from the Partnership Assets or the disposal or the release of Hazardous Substances generated by operation of the Partnership Assets at locations not constituting Partnership Assets), including (A) the cost and expense of any investigation, assessment, evaluation, monitoring, containment, cleanup, repair, restoration, remediation, risk-based closure activities or other corrective action required or necessary under Environmental Laws and (B) the cost and expense of the preparation and implementation of any closure, remedial, corrective action or other plans required or necessary under Environmental Laws as in effect prior to the Closing Date; and

(iii) any environmental event, condition or matter associated with or arising from the Retained Assets, whether occurring before, on or after the Closing Date and whether occurring under Environmental Laws as in effect prior to, at or after the Closing Date;

provided however , that with respect to any violation of Environmental Laws subject to  Section 2.1(a)(i)  or any environmental event, condition or matter subject to  Section 2.1(a)(ii) , Noble will

 

9


be obligated to indemnify such Partnership Group Member only to the extent that such violation or environmental event, condition or matter (x) was caused by the consummation of the transactions contemplated by the Contribution Agreement or commenced, occurred or existed before the Closing Date under Environmental Laws as in effect prior to the Closing Date and (y) Noble is notified in writing of such violation or environmental event, condition or matter prior to the Identification Deadline. For the avoidance of doubt, Noble shall have no indemnification obligations under  Sections 2.1(a)(i)  and  2.1(a)(ii)  with respect to any claims based on additions to or modifications of Environmental Laws enacted or promulgated after the Closing Date. Losses subject to indemnification in this  Section 2.1(a)(i)  are referred to collectively as “ Covered Environmental Losses .”

(b) To the fullest extent permitted by law, the Partnership shall indemnify, defend and hold harmless the Noble Energy Group from and against any Losses suffered or incurred by such Partnership Group Member, directly or indirectly, by reason of or arising out of:

(i) any violation of Environmental Laws associated with or arising from the ownership or operation of the Partnership Assets occurring on or after the Closing Date; and

(ii) any environmental event, condition or matter associated with or arising from the ownership or operation of the Partnership Assets occurring on or after the Closing Date (including the presence of Hazardous Substances on, under, about or migrating to or from the Partnership Assets or the disposal or the release of Hazardous Substances generated by operation of the Partnership Assets at locations not constituting Partnership Assets), including (A) the cost and expense of any investigation, assessment, evaluation, monitoring, containment, cleanup, repair, restoration, remediation, risk-based closure activities or other corrective action required or necessary under Environmental Laws as in effect on or after the Closing Date and (B) the cost or expense of the preparation and implementation of any closure, remedial, corrective action or other plans required or necessary under Environmental Laws as in effect on or after the Closing Date;

and regardless of whether such violation included under  Section 2.1(b)(i)  or such environmental event, condition or matter included under Section 2.1(b)(ii)  occurred before or after the Closing Date, in each case, to the extent that any of the foregoing are not Covered Environmental Losses (without giving effect to the Deductible).

2.2 Right-of-Way Indemnification. Noble shall indemnify, defend and hold harmless each Partnership Group Member from and against any Losses suffered or incurred by such Partnership Group Member by reason of or arising out of the following (“ Covered Property Losses ”):

(a) the failure of such Partnership Group Member to hold valid and indefeasible rights granted under surface use agreements, rights-of-way, surface leases, other easement rights or other real property interests in and to the lands on which any of the Partnership Assets conveyed or contributed to such Partnership Group Member on the Closing Date is located as described in the Registration Statement, and such failure (i) renders such Partnership Group Member liable to a Third Party or unable to use or operate the Partnership Assets in substantially

 

10


the same manner that the Partnership Assets were used and operated by Noble immediately prior to the Closing Date or (ii) renders such Partnership Group Member unable to use the applicable real property interest for its intended purpose;

(b) the failure of such Partnership Group Member to have the consents, licenses and permits necessary to allow (i) any pipeline included in the Partnership Assets to cross the roads, waterways, railroads and other areas upon which any such pipeline is located as of the Closing Date or (ii) the Transfer of any of the Partnership Assets to the Partnership Group, in each case, where such failure renders the Partnership Group liable to a Third Party or unable to use or operate the Partnership Assets in substantially the same manner that the Partnership Assets were used and operated as described in the Registration Statement; and

(c) the cost of curing any condition set forth in  Section 2.2(a)  or  (b)  that does not allow any Partnership Assets to be operated in accordance with prudent industry practice;

provided, however , in each case, to the extent Noble is notified in writing of any of the foregoing prior to the Identification Deadline and in each case other than in respect of which the Partnership has indemnified Noble for the Wells Ranch CGF Indemnity.

2.3 A dditional Indemnification.

(a) In addition to and not in limitation of the indemnification provided under Section 2.1(a) and Section 2.2, to the fullest extent permitted by law, Noble shall indemnify, defend and hold harmless each Partnership Group Member from and against any Losses suffered or incurred by such Partnership Group Member by reason of or arising out of:

(i) (A) the consummation of the transactions contemplated by the Contribution Agreement or (B) events and conditions associated with the ownership or operation of the Partnership Assets and with respect to this subsection (B) only, occurring before the Closing Date (other than Covered Environmental Losses which are provided for under  Section 2.1 and Covered Property Losses which are provided for under Section 2.2 );

(ii) any litigation matters attributable to the ownership or operation of the Partnership Assets prior to the Closing Date and any obligations arising out of incidents or events related to fire, explosion or other similar extraordinary event on or near the Partnership Assets prior to the Closing Date;

(iii) events and conditions associated with the Retained Assets, whether occurring before, on or after the Closing Date;

(iv) all federal, state and local Tax liabilities attributable to the ownership or operation of the Partnership Assets on or prior to the Closing Date, including under Treasury Regulation Section 1.1502-6, as it may be amended (or any similar provision of state or local law), and any such Tax liabilities that may result from the consummation of the transactions contemplated by the Contribution Agreement; and

 

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(v) the failure of any Partnership Group Member to have on the Closing Date any consent, license, permit or approval necessary to allow such Partnership Group Member to own or operate the Partnership Assets in substantially the same manner that the Partnership Assets were owned or operated immediately prior to the Closing Date.

(b) The Partnership shall indemnify, defend and hold harmless Noble Energy Group from and against any Losses suffered or incurred by any Noble Energy Group Member by reason of or arising out of events and conditions to the extent associated with the ownership or operation of the Partnership Assets and to the extent occurring after the Closing Date (other than Covered Environmental Losses which are provided for under  Section 2.2(a)  and Losses for which the Partnership is indemnifying Noble under  Section 2.1(b) ), unless such indemnification would not be permitted by any Partnership Group Member under the Partnership Agreement.

(c) The Partnership shall indemnify, defend and hold harmless the Noble Energy Group from and against any Losses suffered or incurred by any Noble Energy Group Member by reason of or arising out of events and conditions, regardless of whether occurring prior to or following the Closing Date (the “ Wells Ranch CGF Indemnity ”), to the extent associated with the Surface Lease, dated as of May 18, 2012, by and between Noble, Wells Ranch, LLLP and the other persons named as “Owners” thereunder, covering approximately 61 acres in Weld County, Colorado (the “ Original Lease ”), as assigned, amended or otherwise modified by that certain Partial Assignment of Surface Lease with Wattenberg Holding, LLC, dated October 22, 2012, pursuant to which a portion of Noble’s interest in the Surface Lease was assigned to such assignee, as further assigned, amended or otherwise modified by that certain Amendment to Surface Lease, dated June 18, 2013, pursuant to which certain payment terms appearing in the Surface Lease were modified, as further assigned, amended or otherwise modified by that certain First Amendment to Surface Lease, dated July 3, 2013, pursuant to which certain terms of the Surface Lease were modified, as further assigned, amended or otherwise modified by that certain Amendment 03 to Surface Lease, dated effective as of January 1, 2015, pursuant to which OpCo became a party to the Original Lease (such Original Lease, and all amendments prior to the date hereof and as such Original Lease may be further assigned, amended or otherwise modified from time to time, the “ Wells Ranch CGF Surface Lease ”). In consideration of this Wells Ranch CGF Indemnity, Noble hereby agrees that it will not sell, assign, transfer or otherwise modify the Wells Ranch CGF Surface Lease from and after the date hereof without the prior written consent of OpCo.

(d) The Partnership shall indemnify, defend and hold harmless the Noble Energy Group from and against any Losses suffered or incurred by any Noble Energy Group Member by reason of or arising out of events and conditions associated with the Partnership’s exercise of the Property Access Rights.

2.4 Indemnification Procedures .

(a) The Indemnified Party agrees that within a reasonable period of time after it becomes aware of facts giving rise to a claim for indemnification under this Article II , it will provide notice thereof in writing to the Indemnifying Party, specifying the nature of and specific basis for such claim.

 

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(b) The Indemnifying Party shall have the right to control all aspects of the defense of (and any counterclaims with respect to) any claims brought against the Indemnified Party that are covered by the indemnification under this Article II , including the selection of counsel, determination of whether to appeal any decision of any court and the settling of any such claim or any matter or any issues relating thereto; provided, however , that no such settlement for only the payment of money shall be entered into without the consent of the Indemnified Party unless it includes a full release of the Indemnified Party from such claim; provided, further , that no such settlement containing any form of injunctive or similar relief shall be entered into without the prior written consent of the Indemnified Party, which consent shall not be unreasonably delayed or withheld.

(c) The Indemnified Party agrees to cooperate in good faith and in a commercially reasonable manner with the Indemnifying Party with respect to all aspects of the defense of and pursuit of any counterclaims relating to any claims covered by the indemnification under this Article II , including the prompt furnishing to the Indemnifying Party of any correspondence or other notice relating thereto that the Indemnified Party may receive, permitting the name of the Indemnified Party to be utilized in connection with such defense and counterclaims ( provided , that the Indemnified Party has an opportunity to review the use of its name and does not reasonably object to such use), the making available to the Indemnifying Party of any files, records or other information of the Indemnified Party that the Indemnifying Party considers relevant to such defense and counterclaims, the making available to the Indemnifying Party of any employees of the Indemnified Party and the granting to the Indemnifying Party of reasonable access rights to the properties and facilities of the Indemnified Party; provided, however , that in connection therewith the Indemnifying Party agrees to use reasonable efforts to minimize the impact thereof on the operations of the Indemnified Party and further agrees to maintain the confidentiality of all files, records and other information furnished by the Indemnified Party pursuant to this Section 2.4 . The obligation of the Indemnified Party to cooperate with the Indemnifying Party as set forth in the immediately preceding sentence shall not be construed as imposing upon the Indemnified Party an obligation to hire and pay for counsel in connection with the defense of any claims and pursuit of any counterclaims with respect to any claims covered by the indemnification set forth in this Article II ; provided, however , that the Indemnified Party may, at its own option, cost and expense, hire and pay for counsel in connection with any such defense and counterclaims. The Indemnifying Party agrees to keep any such counsel hired by the Indemnified Party informed as to the status of any such defense or counterclaim, but the Indemnifying Party shall have the right to retain sole control over such defense and counterclaims so long as the Indemnified Party is still seeking indemnification hereunder.

(d) In determining the amount of any loss, cost, damage or expense for which the Indemnified Party is entitled to indemnification under this Agreement, the gross amount of the indemnification will be reduced by (i) any insurance proceeds realized by the Indemnified Party, and such correlative insurance benefit shall be net of any incremental insurance premium that becomes due and payable by the Indemnified Party as a result of such claim and (ii) all amounts recovered by the Indemnified Party under contractual indemnities from third Persons.

 

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2.5 Limitations Regarding Indemnification .

(a) Noble shall not be obligated to indemnify, defend and hold harmless any Partnership Group Member under this Agreement until such time as the total aggregate amount of Losses incurred by the Partnership Group exceeds $500,000 (the “ Deductible ”), in the aggregate for all types of Losses, at which time Noble shall be obligated to indemnify the Partnership Group for the amount of such Losses in excess of the Deductible.

(b) For the avoidance of doubt, (i) there is no monetary cap on the amount of indemnity coverage provided by any Indemnifying Party under this  Article II , and (ii) the Partnership’s indemnification obligations under this agreement shall be reduced on a dollar for dollar basis pro rata relative to Noble’s direct or indirect ownership interest in the Partnership Group Member that owns or leases or otherwise controls the Partnership Assets with respect to which an indemnification obligation for Losses exists.

(c) NOTWITHSTANDING ANYTHING HEREIN TO THE CONTRARY, IN NO EVENT SHALL ANY PARTY’S INDEMNIFICATION OBLIGATION HEREUNDER COVER OR INCLUDE CONSEQUENTIAL, INDIRECT, INCIDENTAL, PUNITIVE, EXEMPLARY, SPECIAL OR SIMILAR DAMAGES OR LOST PROFITS (INCLUDING ANY DIMINUTION IN VALUE OF ANY PARTY’S RESPECTIVE INVESTMENT IN THE PARTNERSHIP) SUFFERED, DIRECTLY OR INDIRECTLY, BY ANY OTHER PARTY ENTITLED TO INDEMNIFICATION UNDER THIS AGREEMENT, EXCEPT AS A REIMBURSEMENT FOR ANY SUCH DAMAGES AS ARE PAID TO A GOVERNMENTAL AUTHORITY OR OTHER THIRD PARTY.

2.6 Exclusive Remedy . Notwithstanding anything to the contrary contained in this Agreement, from and after the Closing Date, Section 2.1 , Section 2.2 and Section 2.3 contain the Parties’ exclusive remedy against each other with respect to breaches of the covenants of the Parties set forth in Article II . Except for (a) the remedies contained in Section 2.1 , Section 2.2 and Section 2.3 , (b) any other remedies available to the Parties at law or in equity for breaches of provisions of this Agreement other than Article II and (c) the remedies available at law or in equity in connection with any other document delivered by a Party in connection with the transactions contemplated hereby (including pursuant to the Contribution Agreement), from and after the Closing Date, to the fullest extent permitted by applicable law each of the Parties releases, remises and forever discharges the other and its Affiliates and all such Persons’ equity holders, partners, members, officers, directors, employees, agents, advisors and representatives from any and all Losses in law or in equity, known or unknown, which such Parties might now or subsequently may have, based on, relating to or arising out of this Agreement or the transactions contemplated hereby.

ARTICLE III

SERVICES; REIMBURSEMENT

3.1 General and Administrative Services .

(a) Noble agrees to provide, and agrees to cause its Affiliates to provide, to the General Partner, for the Partnership Group’s benefit, the centralized general and administrative services that Noble and its Affiliates have traditionally provided in connection with the ownership and operation of the Partnership Assets, which consist of the services set forth on Schedule B (the “ General and Administrative Services ”).

 

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(b) Absent the written agreement of the Parties to the contrary, the Parties agree that the General and Administrative Services will be received by the General Partner, for the benefit of the Partnership Group, at the places of business of the General Partner and its subsidiaries.

(c) The Parties acknowledge that the Administrative Fee, together with the other costs and expenses of the General and Administrative Services described herein, will be allocated among the Partnership Group Members (which for the avoidance of doubt, includes each of the Subsidiaries of the Partnership that own the real property interests and physical assets of the Partnership Group Members) based on any reasonable allocation methodology as determined by the General Partner.

(d) For the avoidance of doubt, the General and Administrative Services provided by Noble pursuant to this  Article III  will be in addition to, and not in duplication of, the services that will be provided to the Partnership Parties by Noble and NESI under the Operational Services and Secondment Agreement and the functions performed by the employees seconded to the Partnership Parties under the Operational Services and Secondment Agreement, and neither Noble nor NESI shall not be entitled to reimbursement under this Agreement for any costs or expenses for which Noble or NESI is entitled to payment or reimbursement under the Operational Services and Secondment Agreement.

3.2 Administrative Fee .

(a) As consideration for Noble’s and its Affiliates’ provision of the General and Administrative Services, the Partnership Group will pay to Noble an annual flat fee that will initially be equal to $6,850,000 per year (and prorated for the portion of year following the consummation of the IPO) (the “ Administrative Fee ”), which will be payable in monthly installments. The Parties acknowledge that the fixed fee reflects the costs expected to be incurred by Noble and its Affiliates in providing the General and Administrative Services (other than those costs for which Noble and its Affiliates are entitled to reimbursement pursuant to Section   3.3 below). The Parties further acknowledge and agree that it is the intent of the Parties that the General and Administrative Services be provided based on an arm’s-length standard and that the Administrative Fee is intended to reflect such standard. For the avoidance of doubt, the Parties further acknowledge and agree that the Administrative Fee will cover the fully burdened cost of the General and Administrative Services provided by Noble and its Affiliates to the Partnership Group, as well as any third-party costs actually incurred by Noble and its Affiliates on behalf of the Partnership Group in providing such General and Administrative Services (other than those costs for which Noble and its Affiliates are entitled to reimbursement pursuant to Section   3.3 ), including all sales, use, excise, value added or similar taxes, if any, that may be applicable from time to time with respect to the General and Administrative Services provided by Noble and its Affiliates to the Partnership Group pursuant to Section   3.1 .

(b) If any officer of the General Partner is not covered by the amount paid under the Operational Services and Secondment Agreement, then the Partnership Group shall be allocated an amount in consideration for the services of such employees of Noble Energy Group in their capacities as officers of the General Partner and the Partnership Group Members and such allocated amount shall be included in the Administrative Fee.

 

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(c) Concurrently with the annual rate redetermination process under the Revenue Agreements, Noble shall submit to the Board of Directors of the General Partner its good faith estimate of the cost of the General and Administrative Services to be provided to the Partnership Group for the coming 12-month period, which may be adjusted to reflect, among other things, the contribution, acquisition or disposition of assets to or by the Partnership Group or to reflect any change in the cost of providing General and Administrative Services to the Partnership Group due to changes in any law, rule or regulation applicable to Noble and its Affiliates or the Partnership Group, including any interpretation of such laws, rules or regulations. The Board of Directors of the General Partner shall review the proposed Administrative Fee and shall submit any disputes to Noble as promptly as reasonably practicable. If Noble and the Board of Directors of the General Partner are unable to agree on the Administrative Fee for any year, Noble and the Partnership shall submit the proposed Administrative Fee and supporting documentation to an independent auditing firm for review, and the determination of the independent auditing firm with respect to all items included in the Administrative Fee shall be binding on Noble and the Partnership. Notwithstanding anything contained herein to the contrary, the Administrative Fee shall not be increased until after the third anniversary of the Closing Date.

(d) The Administrative Fee shall be invoiced and paid as follows:

(i) Within 20 days following the end of each month (or the next succeeding business day) beginning with the first full month after the Closing Date and continuing through the termination of this Agreement pursuant to Section 6.4 (the “ NEI Invoice Delivery Date ”), Noble will submit to the Partnership Group an invoice of the amounts due for such month for the Administrative Fee. Each invoice will be as detailed as the General Partner may require, acting reasonably, including (if requested) support of amounts set forth in the invoice and such other supporting detail as requested.

(ii) The Partnership Group will pay the Administrative Fee within 10 days after the receipt of the invoice therefor (the “ Partnership Invoice Payment Date ”). The Partnership Group shall not offset any amounts owing to it by Noble or any of its Affiliates against the Administrative Fee payable hereunder.

3.3 Reimbursement of General and Administrative Expenses.  In addition to the Administrative Fee payable under Section   3.2 , to the extent that Noble and its Affiliates incur direct third-party expenses for the exclusive benefit of the Partnership Group, the Partnership Group will reimburse Noble and its Affiliates for such additional out-of-pocket costs and expenses actually incurred (so long as such amounts are invoiced within three months of incurrence).

3.4 Transition Services. Following the consummation of the IPO, Noble shall use commercially reasonable efforts to amend, assign or otherwise modify the Remaining Vendor Contracts such that a Partnership Group Member is directly contracting with the applicable Third Party vendor under such Remaining Vendor Contracts. Until such time as Noble is able to enter

 

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into the amendments referenced in the foregoing sentence, Noble shall make payments to the vendors under the Remaining Vendor Contracts, and the Partnership shall reimburse Noble for any such payments made on its behalf. Noble shall provide an invoice to OpCo of all payments made pursuant to the Remaining Vendor Contracts by the NEI Invoice Delivery Date for the applicable month, and OpCo shall reimburse Noble for all such payments on or before the Partnership Invoice Payment Date for the applicable month.

ARTICLE IV

RIGHT OF FIRST REFUSAL AND RIGHT OF FIRST OFFER

4.1 Right of First Refusal to Purchase Certain Assets .

(a) Beginning on the date hereof and terminating on the Rights Termination Date, Noble hereby grants to the Partnership a right of first refusal on (i) any proposed Transfer of any ROFR Assets by any Noble Energy Group Member (other than a grant of a security interest to a bona fide third-party lender or a Transfer to any Noble Energy Group Member; provided that such Noble Energy Group Member shall remain bound by this Section 4.1(a) with respect to the ROFR Assets); and (ii) the provision of ROFR Services to any Noble Energy Group Member on the ROFR Acreage.

(b) The Parties acknowledge that all potential Transfers of ROFR Assets pursuant to this Section 4.1 are subject to obtaining any and all required written consents of Third Parties, including Governmental Authorities.

(c) The Partnership shall have the right, in its sole discretion, to assign its rights under this Section   4.1 to any Affiliate of the Partnership.

4.2 ROFR Procedures and Exceptions.

(a) Asset Sale Procedures.   The following sets forth the procedure for Noble to undertake to honor the right of first refusal with respect to the ROFR Assets. Noble’s actions described in this Section 4.2(a) shall be taken by Noble, or Noble shall cause the applicable Noble Energy Group Member to take such actions.

(i) If Noble proposes to Transfer one or more ROFR Assets to any Third Party, then Noble shall promptly give written notice (a “ Disposition Notice ”) thereof to the Partnership. The Disposition Notice shall set forth the following information in respect of the proposed Transfer: (1) the name and address of any prospective acquirors (collectively, the “ Proposed Transferee ”), (2) the ROFR Assets subject to the Disposition Notice (the “ Sale Assets ”), (3) the purchase price offered by such Proposed Transferee or, if no Proposed Transferee has been identified, a commercially reasonable price in the opinion of Noble, in either case including any non-cash consideration (either price described in this clause (3), the “ Offer Price ”), (4) reasonable detail concerning any non-cash portion of the Offer Price, if any, to allow the Partnership to reasonably determine the fair market value of such non-cash consideration, and a statement of the estimate of the fair market value of any non-cash consideration in the opinion of Noble (such term in this Section 4.2 to refer, collectively, to both Noble and the Noble Energy Group Member Transferring the applicable ROFR Asset), and (5) all other material terms

 

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and conditions of the Transfer that are then known to Noble and its Affiliates. To the extent a Proposed Transferee’s offer consists of consideration other than cash (or in addition to cash) the Offer Price shall be deemed equal to the amount of any such cash plus the fair market value of such non-cash consideration.

(ii) The Partnership will provide written notice of either (1) its intent to dispute the Offer Price, as provided in Section 4.2(a)(iii) below or (2) its decision regarding the exercise or non-exercise of its right of first refusal to purchase the Sale Assets within 60 days after its receipt of the Disposition Notice (the “ First ROFR Asset Acceptance Deadline ”). Failure to provide such notice on or prior to the First ROFR Asset Acceptance Deadline shall be deemed to constitute an affirmative decision not to purchase the Sale Assets.

(iii) In the event (1) the Offer Price contains non-cash consideration and the Partnership’s determination of the fair market value of such non-cash consideration described in the Disposition Notice (to be determined by the Partnership on or prior to the First ROFR Asset Acceptance Deadline) is less than the fair market value of such consideration as determined by Noble in the Disposition Notice and (2) the Partnership and Noble are unable to mutually agree upon the fair market value of such non-cash consideration on or prior to the date that is 15 days after the First ROFR Asset Acceptance Deadline, Noble and the Partnership shall engage a mutually agreed upon valuation firm to determine the fair market value of the non-cash consideration. If the Partnership and Noble do not agree on the appointment of such valuation firm, each of the Partnership and Noble shall appoint an independent third party and shall instruct such third party, together with the independent third party appointed by the other Party, to select a valuation firm to perform the valuation hereunder. Such valuation firm shall be instructed to notify the Partnership and Noble of its decision within 30 days after all material information is submitted thereto, which decision shall be final and binding. The fees of the valuation firm will be split equally between Noble and the Partnership. The Partnership will provide written notice of its decision regarding the exercise of its right of first refusal to purchase the Sale Assets to Noble within 15 days after the valuation firm has submitted its determination (the “ Second ROFR Asset Acceptance Deadline ”). Failure to provide such notice on or prior to the Second ROFR Asset Acceptance Deadline shall be deemed to constitute an affirmative decision by the Partnership not to purchase the Sale Assets, subject to Section 4.2(f) .

(iv) If the Partnership fails to exercise a right during any applicable period set forth in this Section 4.2(a) , the Partnership shall be deemed to have waived its right with respect to such proposed disposition of the Sale Assets (subject to Section 4.2(f)) , but such waiver shall not extend to any ROFR Assets that were not Sale Assets.

(b) Services Procedures . The following sets forth the procedure for Noble to undertake to honor the right of first refusal with respect to ROFR Services. Noble’s actions described in this Section 4.2(b) shall be taken by Noble or Noble shall cause the applicable Noble Energy Group Member to take such actions.

 

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(i) If a Noble Energy Group Member proposes to (x) contract with any Third Party for the provision of ROFR Services to such Noble Energy Group Member on specified acreage that is ROFR Acreage or (y) continue, extend or renew any existing contract other than a Revenue Agreement for the provision of ROFR Services to such Noble Energy Group Member on acreage that is ROFR Acreage (either contract described in clauses (x) or (y), a “ Services Contract ”), then Noble shall promptly give written notice (a “ Services Notice ”) thereof to the Partnership. The Services Notice shall set forth the following information in respect of the Services Contract: (1) the name and address of any prospective provider of ROFR Services (collectively, the “ Proposed Provider ”), (2) a detailed description of the services subject to the Services Notice (the “ Proposed Services ”), (3) the rate proposed to be charged by such Proposed Provider or, if no Proposed Provider has been identified, a commercially reasonable price in the opinion of the Noble Energy Group (either price described in this clause (3), the “ Service Rate ”), (4) a description of the area in which the Proposed Services are required (the “ Proposed Service Acreage ”), (5) the in-service date required by the applicable Noble Energy Group Member, (6) reasonable detail of any required capital commitments or the build costs to acquire or build any assets necessary to provide the Proposed Services that have been proposed by the Proposed Provider, or, if no Proposed Provider has been identified, commercially reasonable capital commitments or build costs to acquire or build any assets necessary to provide the Proposed Services in the opinion of the Noble Energy Group; and (7) all other material terms and conditions that have been negotiated between such Noble Energy Group Member and such Proposed Provider, or, if no Proposed Provider has been identified, any other commercially reasonable terms and conditions in the opinion of the Noble Energy Group.

(ii) The Partnership will provide written notice of its decision regarding the exercise or non-exercise of its right of first refusal to provide the Proposed Services within 60 days after its receipt of the Services Notice (the “ ROFR Services Acceptance Deadline ”). Failure to provide such notice prior to the ROFR Services Acceptance Deadline shall be deemed to constitute an affirmative decision not to provide the Proposed Services with respect to the Proposed Service Acreage, subject to Section 4.2(f) .

(iii) If the Partnership fails to exercise a right during any applicable period set forth in this Section 4.2(b), the Partnership shall be deemed to have waived its rights to provide the Proposed Services on the Proposed Service Acreage (subject to Section 4.2(f) ), but such waiver shall not extend to ROFR Services that were not described in the Services Notice and shall not extend to ROFR Acreage that was not included in the Proposed Service Acreage.

(c) If the Partnership chooses to exercise its right of first refusal under Section 4.2(a) , the Partnership and Noble shall enter into a definitive agreement for the purchase of the Sale Assets, which shall include the relevant terms included in the Disposition Notice and other reasonable and customary closing terms and conditions, including the following:

(i) with respect to any Sale Assets, the Partnership will agree to deliver cash for the Offer Price (unless the Partnership and Noble agree that consideration will be paid by means of non-cash consideration);

 

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(ii) Noble will represent that it has good and indefeasible title to the Sale Assets, subject to all recorded matters and all physical conditions in existence on the closing date for the purchase of the Sale Assets, plus any other such matters as the Partnership may approve, which approval will not be unreasonably withheld. If the Partnership desires to obtain any title insurance with respect to the Sale Assets, the full cost and expense of obtaining the same (including the cost of title examination, document duplication and policy premium) shall be borne by the Partnership;

(iii) Noble will grant to the Partnership the right, exercisable at the Partnership’s risk and expense, to make such surveys, tests and inspections of the Sale Assets, and perform other diligence with respect to the Sale Assets, as the Partnership may deem desirable, so long as such surveys, tests, inspections or diligence do not damage the Sale Assets or interfere with the activities of Noble and its Affiliates (other than the Partnership Group) thereon and so long as the Partnership has furnished Noble with evidence that adequate liability insurance is in full force and effect;

(iv) The Partnership will have the right to terminate its obligation to purchase the Sale Assets under this Article if the results of any searches, surveys, tests, inspections or diligence conducted pursuant to Section 4.2(c)(ii) or Section 4.2(c)(iii) above are, in the reasonable opinion of the Partnership, unsatisfactory;

(v) the closing date for the purchase of the Sale Assets shall occur no later than 120 days following receipt by Noble of written notice by the Partnership of its intention to exercise its option to purchase the Sale Assets pursuant to Section 4.2(a) ;

(vi) Noble shall execute, have acknowledged and deliver to the Partnership a special warranty deed, assignment of easement, or comparable document, as appropriate, in the applicable jurisdiction, on the closing date for the purchase of the Sale Assets constituting real property interests, conveying such Sale Assets to the Partnership free and clear of all encumbrances created by Noble and its Affiliates other than those set forth in Section 4.2(c)(ii) above;

(vii) Noble shall execute, have acknowledged and deliver to the Partnership a bill of sale and any other documents reasonably requested by the Partnership on the closing date for the purchase of the Sale Assets other than real property interests, conveying such Sale Assets to the Partnership free and clear of all encumbrances created by Noble and its Affiliates other than those set forth in Section 4.2(c)(ii) above; and

(viii) neither Noble nor the Partnership shall have any obligation to sell or buy the Sale Assets if any of the material consents referred to in Section 4.1(b) have not been obtained.

(d) If the Partnership chooses to exercise its right of first refusal under Section 4.2(b) , the Partnership and Noble shall enter into a definitive agreement for the provision of the Proposed Services on the Proposed Service Acreage on the terms described in the Services Notice provided in accordance with Section 4.2(b) .

 

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(e) Noble and the Partnership shall cooperate in good faith in obtaining all necessary approvals, waivers and consents from Third Parties, including Governmental Authorities, required in connection with the exercise of the Partnership’s rights under this Article IV .

(f) If (i) the Transfer to any Third Party of any Sale Assets is not consummated on terms substantially similar to the terms set forth in the Disposition Notice or (ii) the entry into a definitive agreement providing for the provision of Proposed Services by a Third Party has not occurred on terms substantially similar to the terms set forth in the Services Notice, in each case within the later of (A) 120 days after the last applicable Acceptance Deadline, and (B) 10 days after the satisfaction of all approval or filing requirements with Governmental Authorities, if any, the ROFR Notice shall be deemed to lapse, and no member of the Noble Energy Group may Transfer any of the Sale Assets or contract with a Third Party to provide the Proposed Services, as applicable, described in the ROFR Notice without complying again with the provisions of this Article IV , and any purported Transfer to such Third Party or contract for Proposed Services with a Third Party not in compliance with this Article IV shall be null and void.

(g) If, after the Partnership has waived its rights pursuant to this Article IV or has allowed an Acceptance Deadline to lapse without the exercise of its rights pursuant to this Article IV , any Noble Energy Group Member proposes to Transfer Sale Assets to a Third Party or contract for the provision of Proposed Services by a Third Party, and such transaction is proposed on terms materially more favorable to such Third Party than those set forth in the applicable ROFR Notice, such ROFR Notice shall be deemed ineffective, and no member of the Noble Energy Group may effect such Transfer of Sale Assets or contract for such provision of Proposed Services, as applicable, without complying again with the provisions of this Article IV .

(h) Notwithstanding anything provided herein, the Noble Energy Group shall be allowed to comply with all preexisting dedications, preferential transfer rights, rights of first refusal (or similar encumbrance) and contracts for service that are in existence on the date that this Agreement becomes effective and on the date that the applicable acreage or asset is acquired by Noble Energy Group (so long as such dedication or contract was not entered into in contemplation of such acquisition). For the avoidance of doubt, to the extent a preexisting encumbrance in favor of a Beneficiary Prohibits Noble from obtaining the applicable ROFR Service from an “affiliate” or Transferring the applicable ROFR Asset to an “affiliate”, Noble may enter into a Services Contract or applicable Transfer documentation without offering the applicable opportunity to the Partnership Group. As used in this paragraph:

(i) “ Beneficiary ” refers to a Person that is not a Noble Energy Group Member or an Partnership Group Member that is the beneficiary of an encumbrance granted by a Noble Energy Group Member;

(ii) “ Prohibit ” includes: (x) an express prohibition, (y) requirements that would cause Noble to be in default of a preexisting encumbrance if Noble contracted with an “affiliate”, and (z) requirements that would cause Noble to lose any material benefit of the applicable encumbrance as a result of contracting with an “affiliate”;

 

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(iii) an “ affiliate ” of Noble shall include the Partnership Group Members so long as the Beneficiary would consider the Partnership Group Members to be “affiliates”; and

(iv) an example of a “ loss of material benefit ” includes: a situation where a preexisting right of first refusal would permit Noble to contract with an unaffiliated third party but such right of first refusal would convert to a dedication in favor of the Beneficiary in the event that Noble attempted to contract with an “affiliate”.

(i) Each of the applicable Noble Energy Group Member and the Partnership shall use commercially reasonable efforts to do or cause to be done all things that may be reasonably necessary to effectuate the consummation of any transactions between a Noble Energy Group Member and a Partnership Group Member contemplated by this Section   4.2, including causing its respective Affiliates to execute, deliver and perform all documents, notices, amendments, certificates, and consents required in connection therewith.

4.3 Right of First Offer.

(a) Noble, on behalf of itself and the Noble Energy Group, hereby grants to the Partnership Group a right of first offer, exercisable at any time prior to the Rights Termination Date, to purchase all or any part of the ROFO Equity to the extent that Noble proposes to Transfer all or any part of any ROFO Equity; provided, however , that Noble may Transfer all or any part of any ROFO Equity to a Noble Energy Group Member that agrees in writing that such ROFO Equity remains subject to the provisions of this Section 4.3 and such Noble Energy Group Member assumes the obligations of Noble under this Section 4.3 with respect to such ROFO Equity, and such Transfer shall not be subject to the Partnership Group’s right of first offer.

(b) The Parties acknowledge that any Transfer of all or any part of any ROFO Equity pursuant to the Partnership’s right of first offer is subject to the terms of all existing agreements with respect to the ROFO Equity and shall be subject to and conditioned on the obtaining of any and all necessary consents of securityholders, Governmental Authorities, lenders or other Third Parties; provided, however , that Noble hereby represents and warrants that, to its knowledge after reasonable investigation, there are no terms in such agreements that would materially impair the rights granted to the Partnership Group pursuant to this Section 4.3 with respect to any ROFO Equity.

(c) The Partnership shall have the right, in its sole discretion, to assign its rights under this Section 4.3 to any Affiliate of the Partnership.

4.4 ROFO Procedures.  The following sets forth the procedure for Noble and the applicable Noble Energy Group Member to undertake to honor the right of first offer on the ROFO Equity. Noble’s actions described in this Section 4.4 shall be taken by Noble, or Noble shall cause the applicable Noble Energy Group Member to take such actions.

(a) If the applicable Noble Energy Group Member proposes to Transfer all or any part of any ROFO Equity to a Third Party prior to the Rights Termination Date (a “ Proposed ROFO Transaction ”), the applicable Noble Energy Group Member shall, prior to entering into any such Proposed ROFO Transaction, first give notice in writing to the Partnership (the

 

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ROFO Notice ”) of its intention to enter into such Proposed ROFO Transaction. The ROFO Notice shall include any material terms, conditions and details that would be necessary for the Partnership to make a responsive offer to enter into the Proposed ROFO Transaction with the applicable Noble Energy Group Member, which terms, conditions and details shall at a minimum include any terms, conditions or details that the applicable Noble Energy Group Member would propose to provide to non-Affiliates in connection with the Proposed ROFO Transaction. If the Partnership determines to purchase the ROFO Equity, the Partnership shall have 60 days following receipt of the ROFO Notice to propose an offer to enter into the Proposed ROFO Transaction with the applicable Noble Energy Group Member (the “ ROFO Response ”). The ROFO Response shall set forth the terms and conditions (including the purchase price the Partnership proposes to pay for the ROFO Equity and the other terms of the purchase) pursuant to which the Partnership would be willing to enter into a binding agreement for the Proposed ROFO Transaction. If no ROFO Response is delivered by the Partnership within such 60-day period, then the Partnership shall be deemed to have waived its right of first offer with respect to such ROFO Equity subject to Section 4.3 .

(b) Unless the ROFO Response is rejected pursuant to written notice delivered by the applicable Noble Energy Group Member to the Partnership within 60 days after the delivery to the applicable Noble Energy Group Member of the ROFO Response, such ROFO Response shall be deemed to have been accepted by the applicable Noble Energy Group Member, and the applicable Noble Energy Group Member shall enter into a definitive agreement with the Partnership providing for the consummation of the Proposed ROFO Transaction upon the terms set forth in the ROFO Response. Unless the applicable Noble Energy Group Member and the Partnership otherwise agree, the terms of the definitive agreement will include reasonable and customary terms and conditions, including the following:

(i) the Partnership will deliver the agreed purchase price (in cash, Partnership Interests, an interest-bearing promissory note or any combination thereof);

(ii) the closing date for the purchase of the ROFO Equity shall occur no later than 120 days following receipt by the applicable Noble Energy Group Member of the ROFO Response pursuant to Section 4.3(a) ;

(iii) each of the applicable Noble Energy Group Member and the Partnership shall use commercially reasonable efforts to do or cause to be done all things that may be reasonably necessary or advisable to effectuate the consummation of any transactions between a Noble Energy Group Member and a Partnership Group Member contemplated by this Section 4.4 , including causing its respective Affiliates to execute, deliver and perform all documents, notices, amendments, certificates, instruments and consents required in connection therewith; and

(iv) neither the applicable Noble Energy Group Member nor the Partnership shall have any obligation to consummate the Proposed ROFO Transaction if any consent referred to in Section 4.3 has not been obtained.

(c) If the Partnership has not timely delivered a ROFO Response as specified in this Section 4.4 with respect to a Proposed ROFO Transaction that is subject to a ROFO Notice, the

 

23


applicable Noble Energy Group Member shall be free to enter into a Proposed ROFO Transaction with any Third Party on terms and conditions no more favorable to such Third Party than those set forth in the ROFO Notice. If the applicable Noble Energy Group Member rejects a ROFO Response with respect to any Proposed ROFO Transaction, the applicable Noble Energy Group Member shall be free to enter into a Proposed ROFO Transaction with any Third Party (i) on terms and conditions (excluding those relating to price) that are not more favorable in the aggregate to such Third Party than those proposed by the Partnership Group in the ROFO Response and (ii) at a price equal to no less than 100% of the price offered by the Partnership in the ROFO Response to the applicable Noble Energy Group Member. If a Proposed ROFO Transaction with a Third Party is not consummated as provided in this Section 4.4(c) within the later of (A) 180 days after the expiration of the 60-day period set forth in Section 4.4(a) or the applicable Noble Energy Group Member’s delivery of notice rejecting the ROFO Response, as applicable, and (B) 10 days after the satisfaction of all approval or filing requirements with Governmental Authorities, if any, the ROFO Notice shall be deemed to lapse, and no member of the Noble Energy Group may enter into a Proposed ROFO Transaction with a Third Party without complying again with the provisions of this Article IV, and any purported consummation of a Proposed ROFO Transaction with a Third Party not in compliance with this Article IV shall be null and void.

ARTICLE V

ACCESS RIGHTS

5.1 Access Rights.  For the term of this Agreement, Noble hereby grants the Partnership Group access and use rights with respect to certain items of real and personal property related to the Retained Assets set forth on Schedule E , and such rights shall include automation services.

ARTICLE VI

MISCELLANEOUS

6.1 Confidentiality .

(a) From and after the Closing Date, each Party (each, a “ Receiving Party ”) in possession of another Party’s (each, a “ Disclosing Party ”) Confidential Information shall (i) hold, and shall cause its Subsidiaries and Affiliates and its and their directors, officers, employees, agents, consultants, advisors, and other representatives (each, a “ Representative ” and, collectively, “ Representatives ”) to hold, all Confidential Information of each Disclosing Party in strict confidence, with at least the same degree of care that applies to such Receiving Party’s confidential and proprietary information, (ii) not use such Confidential Information, except as expressly permitted by such Disclosing Party and (iii) not release or disclose such Confidential Information to any other Person, except its Representatives or except as required by applicable law. Each Party shall be responsible for any Losses resulting from a breach of this Section   6.1 by any of its Representatives.

(b) Notwithstanding Section   6.1(a) , if a Receiving Party becomes legally compelled or obligated to disclose Confidential Information of a Disclosing Party by a Governmental Authority or applicable law, or is required to disclose such Confidential Information pursuant to

 

24


the listing standards of any applicable national securities exchange on which the Receiving Party’s securities are listed or quoted, the Receiving Party shall promptly advise, to the fullest extent permitted by law, the Disclosing Party of such requirement or obligation to disclose Confidential Information as soon as the Receiving Party becomes aware that such a requirement to disclose might become effective in order that, where possible, the Disclosing Party may seek a protective order or such other remedy as the Disclosing Party may consider appropriate in the circumstances. The Receiving Party shall disclose only that portion of the Disclosing Party’s Confidential Information that it is required or obligated to disclose and shall cooperate with the Disclosing Party in allowing the Disclosing Party to obtain such protective order or other relief.

(c) Each Party acknowledges that a Disclosing Party would not have an adequate remedy at law for the breach by a Receiving Party of any one or more of the covenants contained in this Section   6.1 and agrees that, in the event of such breach, the Disclosing Party may, in addition to the other remedies that may be available to it, apply to a court for an injunction to prevent breaches of this Section   6.1 and to enforce specifically the terms and provisions of this Section   6.1 . Notwithstanding any other provision hereof, to the extent permitted by applicable law, the provisions of this Section   6.1 shall survive the termination of this Agreement for a period of two years.

6.2 Choice of Law; Mediation; Submission to Jurisdiction .

(a) This Agreement shall be subject to and governed by the laws of the State of Delaware, excluding any conflicts-of-law rule or principle that might refer the construction or interpretation of this Agreement to the laws of another state. EACH OF THE PARTIES HERETO AGREES THAT THIS AGREEMENT INVOLVES AT LEAST U.S. $100,000.00 AND THAT THIS AGREEMENT HAS BEEN ENTERED INTO IN EXPRESS RELIANCE UPON 6 Del. C. § 2708. EACH OF THE PARTIES HERETO IRREVOCABLY AND UNCONDITIONALLY AGREES (i) TO BE SUBJECT TO THE JURISDICTION OF THE COURTS OF THE STATE OF DELAWARE AND OF THE FEDERAL COURTS SITTING IN THE STATE OF DELAWARE AND (ii) TO THE EXTENT SUCH PARTY IS NOT OTHERWISE SUBJECT TO SERVICE OF PROCESS IN THE STATE OF DELAWARE, TO APPOINT AND MAINTAIN AN AGENT IN THE STATE OF DELAWARE AS SUCH PARTY’S AGENT FOR ACCEPTANCE OF LEGAL PROCESS AND TO NOTIFY THE OTHER PARTIES OF THE NAME AND ADDRESS OF SUCH AGENT.

(b) If the Parties cannot resolve any dispute or claim arising under this Agreement, then no earlier than 10 days nor more than 60 days following written notice to the other Parties, any Party may initiate mandatory, non-binding mediation hereunder by giving a notice of mediation (a “ Mediation Notice ”) to the other Parties to the dispute or claim. In connection with any mediation pursuant to this Section   6.2 , the mediator shall be jointly appointed by the Parties to the dispute or claim and the mediation shall be conducted in Houston, Texas unless otherwise agreed by the Parties to the dispute or claim. All costs and expenses of the mediator appointed pursuant to this Section   6.2 shall be shared equally by the Parties to the dispute or claim. The then-current Model ADR Procedures for Mediation of Business Disputes of the Center for Public Resources, Inc., either as written or as modified by mutual agreement of the Parties to the dispute or claim, shall govern any mediation pursuant to this Section   6.2 . In the mediation, each Party to the dispute or claim shall be represented by one or more senior representatives who shall have

 

25


authority to resolve any disputes. If a dispute or claim has not been resolved within 30 days after the receipt of the Mediation Notice by a Party, then any Party to the dispute or claim may refer the resolution of the dispute or claim to litigation.

(c) Subject to Section   6.2(b) , to the fullest extent permitted by law, each Party agrees that it shall bring any action or proceeding in respect of any claim arising out of or related to this Agreement, whether in tort or contract or at law or in equity, exclusively in any federal or state courts located in Delaware and (i) irrevocably submits to the exclusive jurisdiction of such courts, (ii) waives any objection to laying venue in any such action or proceeding in such courts, (iii) waives any objection that such courts are an inconvenient forum or do not have jurisdiction over it and (iv) agrees that, to the fullest extent permitted by law, service of process upon it may be effected by mailing a copy thereof by registered or certified mail (or any substantially similar form of mail), postage prepaid, to it at its address specified in Section   6.2(d) . The foregoing consents to jurisdiction and service of process shall not, to the fullest extent permitted by applicable law, constitute general consents to service of process in the State of Delaware for any purpose except as provided herein and shall not be deemed to confer rights on any Person other than the Parties.

(d) All notices or requests or consents provided for by, or permitted to be given pursuant to, this Agreement must be in writing and must be given by (a) United States mail, addressed to the Person to be notified, postage prepaid and registered or certified with return receipt requested or (b) delivering such notice in person. Notice given by personal delivery or mail shall be effective upon actual receipt. All notices to be sent to a Party pursuant to this Agreement shall be sent to or made at the address set forth below or at such other address as such Party may stipulate to the other Parties in the manner provided in this Section   6.2 . If to any Noble Energy Group Member:

Noble Energy, Inc.

1001 Noble Energy Way

Houston, Texas 77070

Attention: Arnold J. Johnson, with a copy to Aaron C. Carlson

If to any Partnership Group Member:

Noble Midstream Partners LP

1001 Noble Energy Way

Houston, Texas 77070

Attention: Kirk A. Moore, with a copy to Christine M. McMillan

6.3 Entire Agreement . This Agreement and the Contribution Agreement constitute the entire agreement of the Parties relating to the matters contained herein, superseding all prior contracts or agreements, whether oral or written, relating to the matters contained herein.

6.4 Termination of Agreement . This Agreement, other than the provisions set forth in Section   2.1 hereof and this Article VI , may be terminated (a) by the written agreement of all of the Parties or (b) by Noble or the Partnership upon a Partnership Change of Control by written notice given to the other Parties to this Agreement, upon which termination shall be effective at

 

26


the later of such Partnership Change of Control and the date specified in such written notice. For the avoidance of doubt, the Parties’ indemnification obligations under Article II and the terms of this Article VI shall, to the fullest extent permitted by law, survive the termination of this Agreement in accordance with their respective terms.

6.5 Amendment or Modification . This Agreement may be amended or modified from time to time only by an agreement in writing, signed by (1) Noble, acting on behalf of itself and each other Noble Energy Group Member, (2) the Partnership, acting on behalf of itself and each other Partnership Group Member and (3) any other Party hereto directly impacted by such amendment or modification in a manner different from the other Parties. Notwithstanding the foregoing, the Partnership may release any ROFR Acreage in a written instrument signed by the Partnership.

6.6 Assignment . No Party shall have the right to assign its rights or obligations under this Agreement without the consent of the other Parties; provided, however , that the General Partner and any Partnership Group Member may make a collateral assignment of this Agreement solely to secure financing for the Partnership Group.

6.7 Counterparts . This Agreement may be executed in any number of counterparts with the same effect as if all signatory parties had signed the same document and shall be construed together and shall constitute one and the same instrument. Delivery of an executed signature page of this Agreement by facsimile transmission or in portable document format (.pdf) (or similar electronic format) shall be effective as delivery of a manually executed counterpart hereof.

6.8 Severability . If any provision of this Agreement shall be held invalid or unenforceable by a Governmental Authority of competent jurisdiction, the remainder of this Agreement shall remain in full force and effect.

6.9 Further Assurances . In connection with this Agreement and all transactions contemplated by this Agreement, each Party hereto agrees to execute and deliver such additional documents and instruments and to perform such additional acts as may be necessary or appropriate to effectuate, carry out and perform all of the terms, provisions and conditions of this Agreement and all such transactions.

6.10 Rights of Limited Partners . The provisions of this Agreement are enforceable solely by the Parties to this Agreement, and no Limited Partner or other interest holder of the Partnership shall have the right, separate and apart from the Partnership, to enforce any provision of this Agreement or to compel any Party to this Agreement to comply with the terms of this Agreement.

[Remainder of page intentionally left blank.]

 

27


IN WITNESS WHEREOF , the Parties have executed this Agreement on, and effective as of, the Closing Date.

 

NOBLE ENERGY, INC.
By:  

 

Name:   Kenneth M. Fisher
Title:  

Executive Vice President and

Chief Financial Officer

 

Signature Page to Omnibus Agreement


NOBLE ENERGY SERVICES, INC.
By:  

 

Name:   Sebastian Kristof
Title:   President

 

Signature Page to Omnibus Agreement


NBL MIDSTREAM, LLC
By:  

 

Name:   Charles J. Rimer
Title:   President

 

Signature Page to Omnibus Agreement


NOBLE MIDSTREAM SERVICES, LLC
By:  

 

Name:   Terry R. Gerhart
Title:   Chief Executive Officer

 

Signature Page to Omnibus Agreement


NOBLE MIDSTREAM PARTNERS LP
By:   Noble Midstream GP LLC
By:  

 

Name:   Terry R. Gerhart
Title:   Chief Executive Officer

 

Signature Page to Omnibus Agreement


NOBLE MIDSTREAM GP LLC
By:  

 

Name:   Terry R. Gerhart
Title:   Chief Executive Officer

 

Signature Page to Omnibus Agreement


Schedule A

ROFR Acreage

 

  1. The Dedicated Area, as such term is defined in each Texas Revenue Agreement.

 

  2. The acreage shown below:

 

LOGO

 

Schedule A-1


Schedule B

General and Administrative Services

 

  1. Management services of employees of the Noble Energy Group, including Noble stock based compensation expense (as distinguished from General Partner stock based compensation expense, which remains an obligation of the Partnership and not included in the Administrative Fee).

 

  2. Financial and administrative (including treasury, accounting and internal audit)

 

  3. Preparing and submitting invoices

 

  4. Information technology

 

  5. In-house legal services (for the avoidance of doubt, external counsel hired by the Partnership directly shall be paid by the Partnership directly and therefore such amounts shall not be included in the Administrative Fee)

 

  6. Health, environmental, safety and security (including third-party security services)

 

  7. Human resources

 

  8. Tax

 

  9. Payroll

 

  10. Procurement, inventory and other vendor contracts

 

  11. Real property/land rights (provided that to the extent possible, the Partnership Group shall obtain the rights of way and use agreements directly from third parties who hold the surface rights to the applicable real property)

 

  12. Investor relations

 

  13. Government relations, governmental compliance and public affairs

 

  14. Analytical & engineering (including asset integrity and regulatory services)

 

  15. Business development

 

  16. Risk management

 

  17. Executive services

 

  18. Facility services

 

  19. Logistical services

 

  20. Asset oversight, such as operational management and supervision

 

  21. Public company reporting services

 

Schedule B-1


Schedule C

Reserved.

 

Schedule C-1


Schedule D

Reserved

 

Schedule D-1


Schedule E

Property Access Rights

 

  1. Offices in Denver and Greeley, Colorado, and in Houston, Texas

 

  2. Operational control center in Greeley, Colorado

 

  3. All safety & training facilities and

 

  4. Automation and measurement facilities and equipment.

 

Schedule E-1

Exhibit 10.5

FORM OF

$350,000,000

CREDIT AGREEMENT

dated as of September [    ], 2016

among

NOBLE MIDSTREAM SERVICES, LLC,

as Borrower,

NOBLE MIDSTREAM PARTNERS LP,

as Parent,

JPMORGAN CHASE BANK, N.A.,

as Administrative Agent, a Swing Line Lender and an L/C Issuer,

and

The Other Lenders, Swing Line Lenders and L/C Issuers Party Hereto

 

 

DNB Bank ASA, New York Branch,

as Syndication Agent

BANK OF AMERICA, N.A.

and

BARCLAYS BANK PLC,

as Documentation Agents

J.P. MORGAN SECURITIES LLC,

BARCLAYS BANK PLC,

DNB MARKETS, INC.,

and

MERRILL LYNCH, PIERCE, FENNER & SMITH INCORPORATED,

as Joint Lead Arrangers and Joint Book Runners


Table of Contents

 

        Page  

ARTICLE I DEFINITIONS AND ACCOUNTING TERMS

    1   
 

1.01 Defined Terms

    1   
 

1.02 Other Interpretive Provisions

    22   
 

1.03 Accounting Terms

    22   
 

1.04 Rounding

    23   
 

1.05 References to Agreements and Laws

    23   
 

1.06 Times of Day

    23   
 

1.07 Letter of Credit Amounts

    23   

ARTICLE II THE COMMITMENTS AND BORROWINGS

    23   
 

2.01 The Loans

    23   
 

2.02 Borrowings, Conversions and Continuations of Loans

    24   
 

2.03 Letters of Credit

    25   
 

2.04 Swing Line Loans

    31   
 

2.05 Prepayments

    33   
 

2.06 Termination or Reduction of Commitments

    33   
 

2.07 Repayment of Loans

    34   
 

2.08 Interest

    34   
 

2.09 Fees

    34   
 

2.10 Computation of Interest and Fees; Retroactive Adjustments of Applicable Rate

    35   
 

2.11 Evidence of Debt

    35   
 

2.12 Payments Generally

    36   
 

2.13 Sharing of Payments

    37   
 

2.14 Cash Collateral

    37   
 

2.15 Increase in Aggregate Commitment

    38   
 

2.16 Defaulting Lenders

    39   

ARTICLE III TAXES, YIELD PROTECTION AND ILLEGALITY

    41   
 

3.01 Taxes

    41   
 

3.02 Illegality

    44   
 

3.03 Inability to Determine Rates

    45   
 

3.04 Increased Cost and Reduced Return; Capital Adequacy

    45   
 

3.05 Funding Losses

    46   
 

3.06 Mitigation Obligations; Designation of a Different Lending Office

    46   
 

3.07 Matters Applicable to all Requests for Compensation

    46   
 

3.08 Survival

    47   

ARTICLE IV CONDITIONS PRECEDENT TO CLOSING DATE AND TO CREDIT EXTENSIONS

    47   
 

4.01 Conditions of Closing and Initial Credit Extension

    47   
 

4.02 Conditions to all Credit Extensions

    49   

ARTICLE V REPRESENTATIONS AND WARRANTIES

    49   
 

5.01 Corporate Existence and Power

    49   
 

5.02 Corporate and Governmental Authorization; No Contravention; No Default

    50   
 

5.03 Binding Effect

    50   
 

5.04 Financial Information

    50   
 

5.05 Litigation

    50   
 

5.06 Compliance with ERISA

    50   
 

5.07 Environmental Matters

    51   
 

5.08 Taxes

    51   
 

5.09 Subsidiaries

    51   

 

i


  5.10 Regulatory Restrictions on Borrowing; Margin Regulations     51   
  5.11 Full Disclosure     51   
  5.12 Compliance with Laws     52   
  5.13 Contribution and IPO     52   
  5.14 Ownership of Property; No Liens; Insurance     52   
  5.15 Solvency     52   
  5.16 Patriot Act     52   
  5.17 Anti-Corruption Laws and Sanctions     52   
  5.18 Compliance with Material Agreements     52   
  5.19 EEA Financial Institutions     52   

ARTICLE VI AFFIRMATIVE COVENANTS

    53   
  6.01 Information; Notices of Material Events     53   
  6.02 Payment of Taxes and Obligations     55   
  6.03 Maintenance of Property; Insurance     55   
  6.04 Conduct of Business and Maintenance of Existence     55   
  6.05 Compliance with Laws     55   
  6.06 Inspection of Property, Books and Records     55   
  6.07 Use of Proceeds     56   
  6.08 Governmental Approvals and Filings     56   
  6.09 Material Contracts     56   
  6.10 Guarantee Matters     56   
  6.11 Subsidiaries     57   

ARTICLE VII NEGATIVE COVENANTS

    57   
  7.01 Liens     57   
  7.02 Financial Covenants     59   
  7.03 Transactions with Affiliates     59   
  7.04 Restricted Payments     60   
  7.05 Mergers and Fundamental Changes     60   
  7.06 Change in Nature of Business     60   
  7.07 Use of Proceeds     60   
  7.08 Dispositions     61   
  7.09 Debt     61   
  7.10 Investments     62   
  7.11 Changes in Fiscal Year; Organization Documents     63   
  7.12 Subsidiaries     63   
  7.13 Swap Contracts     64   

ARTICLE VIII EVENTS OF DEFAULT AND REMEDIES

    64   
  8.01 Events of Default     64   
  8.02 Remedies Upon Event of Default     65   
  8.03 Application of Funds     66   

ARTICLE IX ADMINISTRATIVE AGENT

    67   
  9.01 Appointment and Authorization of Administrative Agent     67   
  9.02 Rights as a Lender     67   
  9.03 Exculpatory Provisions     67   
  9.04 Reliance by Administrative Agent     68   
  9.05 Indemnification of Administrative Agent and L/C Issuers     68   
  9.06 Delegation of Duties     68   
  9.07 Resignation of Administrative Agent     69   
  9.08 Non-Reliance on Administrative Agent and Other Lenders     69   
  9.09 No Other Duties, Etc.     69   
  9.10 Administrative Agent May File Proofs of Claim     70   

 

ii


ARTICLE X MISCELLANEOUS

    70   
  10.01 Amendments, Etc.     70   
  10.02 Notices; Effectiveness; Electronic Communication     71   
  10.03 No Waiver; Cumulative Remedies     73   
  10.04 Attorney Costs, Expenses and Taxes     73   
  10.05 Indemnification; Damage Waiver     73   
  10.06 Payments Set Aside     74   
  10.07 Successors and Assigns     74   
  10.08 Confidentiality     78   
  10.09 Set-off     79   
  10.10 Interest Rate Limitation     79   
  10.11 Counterparts     79   
  10.12 Integration     79   
  10.13 Survival of Representations and Warranties     80   
  10.14 Severability     80   
  10.15 Reserved     80   
  10.16 Replacement of Lenders     80   
  10.17 Governing Law; Jurisdiction     81   
  10.18 No Advisory or Fiduciary Responsibility     81   
  10.19 Waiver of Right to Trial by Jury     82   
  10.20 USA PATRIOT Act Notice     82   
  10.21 Entire Agreement     82   
  10.22 No General Partner’s Liability for Revolving Facility     82   
  10.23 Acknowledgement and Consent to Bail-In of EEA Financial Institutions     82   

 

iii


SCHEDULES

 

2.01   Commitments and Pro Rata Shares
5.09   Subsidiaries as of the Closing Date
7.03   Affiliate Contracts as of the Closing Date
7.09   Capital Leases as of Closing Date
7.10   Investments as of the Closing Date
7.12   Certain Agreements as of the Closing Date
10.02   Administrative Agent’s Office, Certain Addresses for Notices

EXHIBITS

Form of

 

A-1   Loan Notice
A-2   Swing Line Loan Notice
B-1   Revolving Note
B-2   Swing Line Note
C   Compliance Certificate
D   Assignment and Assumption
E   Guarantee Agreement
F-1   U.S. Tax Compliance Certificate (Form 1)
F-2   U.S. Tax Compliance Certificate (Form 2)
F-3   U.S. Tax Compliance Certificate (Form 3)
F-4   U.S. Tax Compliance Certificate (Form 4)

 

iv


CREDIT AGREEMENT

This CREDIT AGREEMENT (“ Agreement ”) is entered into as of September [    ], 2016, among Noble Midstream Services, LLC, a Delaware limited liability company (the “ Borrower ”), Noble Midstream Partners LP, a Delaware limited partnership (the “ Parent ”), each Lender from time to time party hereto, JPMorgan Chase Bank, N.A., as Administrative Agent, a Swing Line Lender and an L/C Issuer, and the other L/C Issuers and Swingline Lenders named herein.

The Borrower has requested that the Lenders extend certain credit to the Borrower, and the Administrative Agent, the Swing Line Lenders, the L/C Issuers and the Lenders are willing to do so on the terms and conditions set forth herein.

In consideration of the mutual covenants and agreements herein contained, the parties hereto covenant and agree as follows:

ARTICLE I

DEFINITIONS AND ACCOUNTING TERMS

1.01 Defined Terms . As used in this Agreement, the following terms shall have the meanings set forth below:

Acquisition ” by any Person, means (a) the acquisition by such Person, in a single transaction or in a series of related transactions, of (i) property or assets (other than capital expenditures or acquisitions of inventory or supplies in the ordinary course of business) constituting a business unit or division of another Person or (ii) the Capital Stock of another Person resulting in such other Person becoming a Subsidiary, in each case whether or not involving a merger or consolidation with such other Person and whether for cash, property, services, assumption of Debt, securities or otherwise and (b) any Midstream Drop Down Acquisition.

Adjusted Eurodollar Rate ” means, with respect to any Eurodollar Rate Loan for any Interest Period, an interest rate per annum (rounded upwards, if necessary, to the next 1/16 of 1%) equal to (a) the Eurodollar Rate for such Interest Period multiplied by (b) the Statutory Reserve Rate.

Administrative Agent ” means JPM in its capacity as administrative agent under any of the Loan Documents, or any successor administrative agent.

Administrative Agent’s Office ” means the Administrative Agent’s address and, as appropriate, account as set forth on Schedule 10.02 , or such other address or account as the Administrative Agent may from time to time notify the Borrower and the Lenders.

Administrative Questionnaire ” means an Administrative Questionnaire in a form supplied by the Administrative Agent.

Affiliate ” means, with respect to any Person, another Person that directly, or indirectly through one or more intermediaries, Controls or is Controlled by or is under common Control with the Person specified. “Control” means the possession, directly or indirectly, of the power to direct or cause the direction of the management or policies of a Person, whether through the ability to exercise voting power, by contract or otherwise. “Controlling” and “Controlled” have meanings correlative thereto. For the avoidance of doubt, in no event shall the Administrative Agent, any L/C Issuer or any Lender be deemed an Affiliate of the Parent or any of its Subsidiaries.

Agent-Related Persons ” means the Administrative Agent, together with its respective Affiliates, and the officers, directors, employees, agents and attorneys-in-fact of such Persons and Affiliates.

Aggregate Commitment ” means the aggregate Commitments of all the Lenders.

 

1


Agreement ” has the meaning specified in the introductory paragraph hereto.

Anti-Corruption Laws ” means all Laws, rules, and regulations of any jurisdiction applicable to the Parent and its Subsidiaries from time to time concerning or relating to bribery or corruption.

Applicable Rate ” means, (a) until the Parent or Borrower has obtained a Public Debt Rating from either S&P or Moody’s, the percentages per annum set forth in the Leverage Based Pricing Grid below, based upon the Consolidated Leverage Ratio of the Parent:

LEVERAGE BASED PRICING GRID

 

Pricing
Level

  

Consolidated Leverage
Ratio

   Commitment
Fee Rate
    Eurodollar
Rate
    Letters of
Credit
    Base
Rate
 

1

   Less than 2.75 to 1.00      0.200     1.250     1.250     0.250

2

   Greater than or equal to 2.75 to 1.00 but less than 3.50 to 1.00      0.225     1.375     1.375     0.375

3

   Greater than or equal to 3.50 to 1.00 but less than 4.25 to 1.00      0.275     1.500     1.500     0.500

4

   Greater than or equal to 4.25 to 1.00      0.325     1.750     1.750     0.750

and (b) on the date and at all times after the Parent or the Borrower obtains a Public Debt Rating from either S&P or Moody’s, the percentages per annum set forth in the Ratings Based Pricing Grid below, based upon the Public Debt Ratings of the Parent:

RATINGS BASED PRICING GRID

 

Pricing
Level

  

Public Debt Ratings
S&P/Moody’s

   Commitment
Fee Rate
    Eurodollar
Rate
    Letters of
Credit
    Base
Rate
 

1

   BBB+/Baa1 or higher      0.125     1.125     1.125     0.125

2

   BBB/Baa2      0.175     1.250     1.250     0.250

3

   BBB-/Baa3      0.200     1.500     1.500     0.500

4

   BB+/Ba1or lower      0.250     1.750     1.750     0.750

From the Closing Date until the earlier of (i) the date the first Compliance Certificate is delivered pursuant to Section 6.01(c) or (ii) the date on which the Parent or Borrower obtains a Public Debt Rating from either S&P or Moody’s, the Applicable Rate in effect shall be determined based upon Pricing Level 1 of the Leverage Based Pricing Grid (subject to the proviso below if such Compliance Certificate is not delivered when due). Thereafter, to the extent neither the Parent nor the Borrower has obtained a Public Debt Rating from either S&P or Moody’s, the Applicable Rate shall be determined based upon the Compliance Certificate to be delivered pursuant to Section 6.01(c) , until the date that the Parent or Borrower shall have obtained a Public Debt Rating from either S&P or Moody’s, on which date the Applicable Rate shall be determined as set forth in the Ratings Based Pricing Grid. Any increase or decrease in the Applicable Rate resulting from a change in the Consolidated Leverage Ratio shall become effective as of the first Business Day immediately following the date that the Compliance Certificate is required to be delivered pursuant to Section 6.01(c) ; provided , however, that if a Compliance Certificate is not delivered when due in accordance with such Section, then the Applicable Rate shall be determined based upon Pricing Level 4 of the Leverage Based Pricing Grid and shall continue to apply until the first Business Day immediately following the date a Compliance Certificate is delivered in accordance with Section 6.01(c) , whereupon the Applicable Rate shall be adjusted based upon the calculation of the Consolidated Leverage Ratio contained in such Compliance Certificate.

Each change in the Applicable Rate resulting from a publicly announced change in the Public Debt Ratings shall be effective during the period commencing on the date of the public announcement thereof and ending on the date immediately preceding the effective date of the next such change. If the Public Debt Ratings from both S&P and Moody’s cease to be available, then the Applicable Rate shall be determined based upon Pricing Level 4 of the Rating Based Pricing Grid and shall continue to apply until the date that the Parent shall have obtained a Public Debt Rating from S&P and/or Moody’s, whereupon the Applicable Rate shall be adjusted based on the Public Debt Rating from S&P and/or Moody’s as set forth in the Rating Based Pricing Grid. If the Public Debt

 

2


Ratings from S&P and Moody’s reflect different Pricing Levels, then (i) in the event of a single level split, the higher Public Debt Rating will apply or (ii) in the event of a multiple level split, the Pricing Level will be based on the Public Debt Rating one level lower than the higher of the two Public Debt Ratings.

Approved Fund ” has the meaning specified in Section 10.07(h) .

Arrangers ” means JPM and [TBD], in their capacity as joint lead arrangers and joint book runners.

Assignee Group ” means two or more Eligible Assignees that are Affiliates of one another or two or more Approved Funds managed by the same investment advisor.

Assignment and Assumption ” means an Assignment and Assumption substantially in the form of Exhibit D .

Attorney Costs ” means and includes all reasonable fees, expenses and disbursements of any law firm or other external counsel.

Authorizations ” means all filings, recordings, and registrations with, and all validations or exemptions, approvals, orders, authorizations, consents, franchises, licenses, certificates, and permits from, any Governmental Authority.

Availability Period ” means the period from and including the Closing Date to the Maturity Date.

Bail-In Action ” means the exercise of any Write-Down and Conversion Powers by the applicable EEA Resolution Authority in respect of any liability of an EEA Financial Institution.

Bail-In Legislation ” means, with respect to any EEA Member Country implementing Article 55 of Directive 2014/59/EU of the European Parliament and of the Council of the European Union, the implementing law for such EEA Member Country from time to time which is described in the EU Bail-In Legislation Schedule.

Base Rate ” means, for any day, a rate per annum equal to the greatest of (a) the Prime Rate in effect on such day, (b) the NYFRB Rate in effect on such day plus  1 2 of 1% and (c) the Adjusted Eurodollar Rate for a one month Interest Period on such day (or if such day is not a Business Day, the immediately preceding Business Day) plus 1%, provided that, the Adjusted Eurodollar Rate for any day shall be based on the Adjusted Eurodollar Rate at approximately 11:00 a.m. London time on such day. Any change in the Base Rate due to a change in the Prime Rate, the NYFRB Rate or the Adjusted Eurodollar Rate shall be effective from and including the effective date of such change in the Prime Rate, the NYFRB Rate or the Adjusted Eurodollar Rate, respectively.

Base Rate Loan ” means a Loan that bears interest based on the Base Rate. All Base Rate Loans shall be denominated in Dollars.

Benefit Arrangement ” means, at any time, an employee benefit plan within the meaning of Section 3(3) of ERISA which is not a Plan or a Multiemployer Plan and which is maintained or otherwise contributed to by any member of the ERISA Group.

Borrower ” has the meaning specified in the introductory paragraph hereto.

Borrowing ” means Loans of the same Type and, in the case of Eurodollar Rate Loans, having the same Interest Period made by each of the Lenders pursuant to Section 2.01 .

Business Day ” means any day other than a Saturday, Sunday or other day on which commercial banks are authorized to close under the Laws of, or are in fact closed in, New York City or the state where the Administrative Agent’s Office is located and, if such day relates to any Eurodollar Rate Loan, means any such day on which dealings in Dollar deposits are conducted by and between banks in the London interbank eurodollar market.

 

3


Capital Lease ” means any lease of any property by the Parent or any of its Subsidiaries, as lessee, that should, in accordance with GAAP (subject to Section 1.03(b) ), be classified and accounted for as a capital lease on a consolidated balance sheet of the Parent and its Subsidiaries.

Capital Stock ” means shares of capital stock in a corporation, partnership interests in a partnership, membership interests in a limited liability company, beneficial interests in a trust or other equity ownership interests in a Person, and any warrants, options or other rights entitling the holder thereof to purchase or acquire any such equity interest (other than any debt security which by its terms is convertible at the option of the holder into Capital Stock, to the extent such holder has not so converted such debt security).

Cash Collateralize ” means to pledge and deposit with or deliver to the Administrative Agent, for the benefit of one or more of the L/C Issuers or the Lenders, as collateral for L/C Obligations or obligations of the Lenders to fund participations in respect of L/C Obligations, cash or deposit account balances or, if the Administrative Agent and the applicable L/C Issuer or L/C Issuers shall agree, in their sole discretion, other credit support, in each case pursuant to documentation in form and substance reasonably satisfactory to the Administrative Agent and the applicable L/C Issuer or L/C Issuers.

Cash Collateral ”, in such context, shall have a meaning correlative to the foregoing and shall include the proceeds of such Cash Collateral and other credit support.

Cash Equivalents ” means, collectively, (a) marketable direct obligations issued or unconditionally guaranteed by the United States or any agency thereof maturing within twelve (12) months from the date of acquisition thereof, (b) commercial paper maturing no more than one hundred eighty (180) days from the date of creation thereof and currently having the highest rating obtainable from either S&P or Moody’s, (c) certificates of deposit maturing no more than one hundred eighty (180) days from the date of creation thereof issued by commercial banks incorporated under the Laws of the United States, each having combined capital, surplus and undivided profits of not less than $500,000,000 and having a rating of “A” or better by a nationally recognized rating agency; provided that the aggregate amount invested in such certificates of deposit shall not at any time exceed $5,000,000 for any one such certificate of deposit and $10,000,000 for any one such bank, (d) time deposits maturing no more than thirty (30) days from the date of creation thereof with commercial banks or savings banks or savings and loan associations each having membership either in the FDIC or the deposits of which are insured by the FDIC and in amounts not exceeding the maximum amounts of insurance thereunder and (e) money market investments, classified in accordance with GAAP as current assets, in money market investment programs registered under the Investment Company Act of 1940 which are administered by reputable financial institutions having capital of at least $500,000,000 or having portfolio assets of at least $5,000,000,000 and the portfolios of which are limited to investments of the character described in the foregoing subdivisions (a) through (d).

Change in Law ” means the occurrence, after the date of this Agreement (or with respect to any Lender, if later, the date on which such Lender becomes a Lender), of any of the following: (a) the adoption or taking effect of any law, rule, regulation or treaty, (b) any change in any law, rule, regulation or treaty or in the administration, interpretation or application thereof by any Governmental Authority, or (c) the making or issuance of any request, guideline or directive (whether or not having the force of law) by any Governmental Authority; provided that notwithstanding anything herein to the contrary, (i) the Dodd-Frank Wall Street Reform and Consumer Protection Act and all requests, rules, guidelines or directives thereunder or issued in connection therewith and (ii) all requests, rules, guidelines or directives promulgated by the Bank for International Settlements, the Basel Committee on Banking Supervision (or any successor or similar authority) or the United States or foreign regulatory authorities, in each case pursuant to Basel III, shall in each case be deemed to be a “Change in Law”, regardless of the date enacted, adopted or issued.

Change of Control ” means the failure of (i) the Parent to own and control 100% of the Capital Stock of the Borrower, (ii) the General Partner to be the sole general partner of, and to Control, the Parent or (iii) Noble to own and control, directly or indirectly, at least 51% of the Voting Stock of the General Partner.

Closing Date ” means September [    ], 2016, which is the first date all the conditions precedent in Section 4.01 are satisfied (or waived in accordance with Section 10.03 ).

 

4


Code ” means the Internal Revenue Code of 1986.

Commercial Operation Date ” means the date on which a Qualified Project is substantially complete and commercially operable.

Commitment ” means, (a) with respect to each Lender listed on Schedule 2.01 , the amount set forth opposite such Lender’s name on such Schedule, (b) with respect to any financial institution which becomes a Lender pursuant to Section 2.15 , the amount of the Commitment extended by it as of the applicable Increase Effective Date and (c) with respect to any assignee which becomes a Lender pursuant to Section 10.07(b) , the amount of the transferor Lender’s Commitment assigned to it pursuant to Section 10.07(b) , in each case as such amount may be adjusted from time to time pursuant to this Agreement; provided that, if the context so requires, the term “ Commitment ” means the obligation of a Lender to extend credit up to such amount to the Borrower hereunder.

Compliance Certificate ” means a certificate substantially in the form of Exhibit C .

Consolidated EBITDA ” means, for any period, subject to Section 1.03(c) , an amount equal to (a) Consolidated Net Income for such period plus (b) to the extent deducted in determining Consolidated Net Income for such period and without duplication, the aggregate amount of (i) Consolidated Interest Charges, (ii) Taxes based on or measured by income, (iii) depreciation and amortization expense, (iv) goodwill or other impairment charges and other non-cash charges, (v) non-recurring expenses, (vi) non-cash losses resulting from mark to market accounting of Swap Agreements, (vii) reasonable and customary out-of-pocket cash fees and expenses incurred in connection with the proposed or consummated incurrence or repayment of any Debt, Disposition, Investment or issuance of Capital Stock in a public offering (in each case in a transaction not prohibited by this Agreement), in an aggregate annual amount for all such transactions not to exceed $15,000,000 and (viii) one-time transaction expenses related to execution and delivery of this Agreement and the Transactions in an aggregate amount not to exceed $35,000,000, which will be added back in the fiscal year incurred, minus (c) to the extent included in calculating such Consolidated Net Income for such period and without duplication, the aggregate amount of all non-cash items and non-recurring gains. For the purposes of calculating Consolidated EBITDA, Consolidated Net Income and the expenses and other items described above shall be adjusted with respect to the portion of Consolidated Net Income and the portion of such expenses and other items which are attributable to any non-wholly owned Subsidiaries of the Parent, to reflect only the Parent’s pro rata ownership interest in such Subsidiaries. The calculation of Consolidated EBITDA may be subject from time to time to the pro forma adjustments described in Section   1.03(c) .

Consolidated Funded Debt ” means, as of any date of determination, the outstanding Debt of the Parent and its Subsidiaries on a consolidated basis, excluding Debt described in clauses (d) and (g) (but only to the extent the Debt being Guaranteed does not constitute Consolidated Funded Debt) of the definition thereof and to the extent of undrawn letters of credit, clause (b) of the definition thereof.

Consolidated Interest Charges ” means, for any period determined on a consolidated basis for the Parent and its Subsidiaries, all cash interest expense (including, without limitation, interest expense attributable to Capital Leases and all net payment obligations pursuant to interest rate Swap Contracts) for such period, in accordance with GAAP.

Consolidated Interest Coverage Ratio ” means, as of the last day of each fiscal quarter of the Parent, the ratio of (a) Consolidated EBITDA for the period of four consecutive fiscal quarters ending on such day to (b) Consolidated Interest Charges for the period of four consecutive fiscal quarters ending on such day.

Consolidated Leverage Ratio ” means, as of the last day of each fiscal quarter of the Parent, the ratio of (a) Consolidated Funded Debt on such day to (b) Consolidated EBITDA for the period of four consecutive fiscal quarters ending on such day.

Consolidated Leverage Ratio Trigger Date ” means the first date on which Consolidated EBITDA for the period of four consecutive fiscal quarters is equal to or greater than $135,000,000.00.

 

5


Consolidated Net Income ” means, for any period, the net income of the Parent and its Subsidiaries for such period determined on a consolidated basis in accordance with GAAP; provided that Consolidated Net Income shall not include (a) extraordinary gains or extraordinary losses, (b) net gains and losses in respect of dispositions of assets other than in the ordinary course of business, (c) gains or losses attributable to write-ups or write-downs of assets, including hedging and derivative activities in the ordinary course of business, (d) the cumulative effect of a change in accounting principles, all as reported in the Parent’s consolidated statement(s) of operations for the relevant period(s) prepared in accordance with GAAP, (e) the income or loss of any Person other than a Subsidiary in which the Parent or any Subsidiary has an ownership interest, except to the extent that any such income has been actually received by the Parent or such Subsidiary in the form of cash dividends or similar cash distributions, or (f) any undistributed net income of a Subsidiary to the extent that the ability of such Subsidiary to make Restricted Payments to the Parent or another Subsidiary is, as of the date of determination of Consolidated Net Income, restricted by its Organizational Documents, any contractual obligation (other than this Agreement) or any applicable Law.

Consolidated Net Tangible Assets ” means, at any date of determination, the total amount of consolidated assets of the Parent and its Subsidiaries minus the value (net of any applicable reserves) of all goodwill, trade names, trademarks, patents and other like intangible assets, all as set forth, or on a pro forma basis would be set forth, on the consolidated balance sheet of the Parent and its Subsidiaries for the most recently completed fiscal quarter, in accordance with GAAP.

Contributed Business ” means the assets, liabilities and operations contributed to the Parent or its Subsidiaries by Noble or its Subsidiaries, as applicable, in connection with the consummation of the IPO, as described in the Registration Statement.

Contribution ” means the direct or indirect transfer, in one or more transactions, by Noble and its Subsidiaries to the Parent of the Contributed Business.

Control ” has the meaning specified in the definition of “Affiliate.”

Credit Extension ” means each of the following: (a) a Borrowing and (b) an L/C Credit Extension.

Debt ” means, as to any Person at a particular time, without duplication, all of the following, whether or not included as Debt or liabilities in accordance with GAAP:

(a) all obligations of such Person for borrowed money and all obligations of such Person evidenced by bonds, debentures, notes, loan agreements or other similar instruments;

(b) the amount available to be drawn under all letters of credit (including standby and commercial) (other than letter of credit obligations relating to indebtedness included in Debt pursuant to another clause of this definition) and, without duplication, the unreimbursed amount of all drafts drawn thereunder;

(c) all obligations of such Person to pay the deferred purchase price of property or services (other than current liabilities and trade payables incurred in the ordinary course of business in connection with the purchase of goods and services which are not greater than ninety (90) days past the due date therefor or which are being contested in good faith by appropriate action and for which adequate reserves have been established in accordance with GAAP);

(d) debt (excluding prepaid interest thereon) of another Person secured by a Lien on property owned or being purchased by such Person (including debt arising under conditional sales or other title retention agreements), whether or not such debt shall have been assumed by such Person or is limited in recourse;

(e) Capital Leases;

(f) to the extent required to be included on the Parent’s consolidated balance sheet as debt or liabilities in accordance with GAAP, Synthetic Lease Obligations; and

(g) all Guarantees of such Person in respect of any of the foregoing.

 

6


For all purposes hereof, the Debt of the Parent shall include the Debt of any partnership or joint venture (other than a joint venture that is itself a corporation or limited liability company) in which the Parent or any Subsidiary of the Parent is a general partner or a joint venturer (provided, however, for the avoidance of doubt, as used in this sentence “joint venturer” shall not include a limited partner in a limited partnership), unless such Debt is expressly made non-recourse to the Parent or Subsidiary, as applicable.

Debtor Relief Laws ” means the Bankruptcy Code of the United States, and all other liquidation, conservatorship, bankruptcy, assignment for the benefit of creditors, moratorium, rearrangement, receivership, insolvency, reorganization, or similar debtor relief Laws of the United States or other applicable jurisdictions from time to time in effect and affecting the rights of creditors generally.

Default ” means any event or condition that constitutes an Event of Default or that, with the giving of any notice, the passage of time, or both, would be an Event of Default.

Default Rate ” means, at any time, an interest rate equal to the interest rate applicable to the outstanding Obligations (inclusive of the Applicable Rate with respect thereto) plus two percent (2.00%).

Defaulting Lender ” means, subject to Section 2.16(b) , any Lender that (a) has failed to (i) fund all or any portion of the Loans required to be funded by it hereunder within two Business Days following the date such Loans were required to be funded hereunder unless such Lender notifies the Administrative Agent and the Borrower in writing that such failure is the result of such Lender’s determination that one or more conditions precedent to funding (each of which conditions precedent, together with any applicable default, shall be specifically identified in such writing) has not been satisfied, or (ii) pay to the Administrative Agent, the L/C Issuers, the Swing Line Lenders or any other Lender any other amount required to be paid by it hereunder (including in respect of its participation in L/C Obligations or Swing Line Loans) within two Business Days following the date when due, (b) has notified the Borrower, the Administrative Agent, the L/C Issuers, the Swing Line Lenders or any other Lender in writing or has made a public statement to the effect, that it does not intend to comply with its funding obligations hereunder, (unless such writing or public statement relates to such Lender’s obligation to fund a Loan hereunder and states that such position is based on such Lender’s determination that a condition precedent to funding (which condition precedent, together with any applicable default, shall be specifically identified in such writing or public statement) cannot be satisfied), (c) has failed, within three Business Days after request by the Administrative Agent or the Borrower, to confirm in writing to the Administrative Agent and the Borrower that it will comply with its prospective funding obligations hereunder (provided that such Lender shall cease to be a Defaulting Lender pursuant to this clause (c) upon receipt of such written confirmation by the Administrative Agent and the Borrower) or (d) has, or has a direct or indirect parent company that has, (i) become the subject of a proceeding under any Debtor Relief Law or Bail-In Action, or (ii) had appointed for it a receiver, custodian, conservator, trustee, administrator, assignee for the benefit of creditors or similar Person charged with reorganization or liquidation of its business or assets, including the Federal Deposit Insurance Corporation or any other state or federal regulatory authority acting in such a capacity; provided that a Lender shall not be a Defaulting Lender solely by virtue of the ownership or acquisition of any equity interest in that Lender or any direct or indirect parent company thereof by a Governmental Authority so long as such ownership interest does not result in or provide such Lender with immunity from the jurisdiction of courts within the United States or from the enforcement of judgments or writs of attachment on its assets or permit such Lender (or such Governmental Authority) to reject, repudiate, disavow or disaffirm any contracts or agreements made with such Lender. Any determination by the Administrative Agent that a Lender is a Defaulting Lender under any one or more of clauses (a) through (d) above shall be conclusive and binding absent manifest error, and such Lender shall be deemed to be a Defaulting Lender (subject to Section 2.16(b) ) upon delivery of written notice of such determination to the Borrower, the L/C Issuers, the Swing Line Lenders and each Lender.

Disposition ” or “ Dispose ” means the sale, transfer, license, lease or other disposition (including any sale and leaseback transaction) of any property by a Loan Party (including the Capital Stock of any Subsidiary), including any sale, assignment, transfer or other disposal, with or without recourse, of any notes or accounts receivable or any rights and claims associated therewith.

 

7


Dollar ” and “ $ ” mean lawful money of the United States.

EEA Financial Institution ” means (a) any institution established in any EEA Member Country which is subject to the supervision of an EEA Resolution Authority, (b) any entity established in an EEA Member Country which is a parent of an institution described in clause (a) of this definition, or (c) any institution established in an EEA Member Country which is a subsidiary of an institution described in clauses (a) or (b) of this definition and is subject to consolidated supervision with its parent;

EEA Member Country ” means any of the member states of the European Union, Iceland, Liechtenstein, and Norway.

EEA Resolution Authority ” means any public administrative authority or any Person entrusted with public administrative authority of any EEA Member Country (including any delegee) having responsibility for the resolution of any EEA Financial Institution.

Eligible Assignee ” has the meaning specified in Section 10.07(h) .

Environmental Laws ” means any and all Federal, state, local, and foreign statutes, laws, regulations, ordinances, rules, judgments, orders, decrees, permits, concessions, grants, franchises, licenses, agreements or governmental restrictions relating to pollution and the protection of the environment or the release of any materials into the environment, including those related to hazardous substances or wastes, air emissions and discharges to waste or public systems.

Environmental Liability ” means any liability, contingent or otherwise (including any liability for damages, costs of environmental remediation, fines, penalties or indemnities), of the Parent or any of its Subsidiaries directly or indirectly resulting from or based upon (a) violation of any Environmental Law, (b) the generation, use, handling, transportation, storage, treatment or disposal of any Hazardous Substances, (c) exposure to any Hazardous Substances, (d) the release or threatened release of any Hazardous Substances into the environment or (e) any contract, agreement or other consensual arrangement pursuant to which liability is assumed or imposed with respect to any of the foregoing.

ERISA ” means the Employee Retirement Income Security Act of 1974.

ERISA Group ” means the Parent, any Subsidiary of the Parent and all members of a controlled group of corporations and all trades or businesses (whether or not incorporated) under common control which, together with the Parent or any Subsidiary, are treated as a single employer under Section 414 of the Code or Section 4001(b)(i) of ERISA.

Eurodollar Rate ” means, for any Interest Period for each Eurodollar Rate Loan, the London interbank offered rate as administered by Intercontinental Exchange Benchmark Administration Ltd. (or any other Person that takes over the administration of such rate for dollars) for a period equal in length to such Interest Period as displayed on pages LIBOR01 or LIBOR02 of the Reuters screen that displays such rate (or, in the event such rate does not appear on a Reuters page or screen, on any successor or substitute page on such screen that displays such rate, or on the appropriate page of such other information service that publishes such rate from time to time as selected by the Administrative Agent in its reasonable discretion; in each case the “ LIBOR Screen Rate ”) at approximately 11:00 A.M. (London time) two (2) Business Days prior to the first day of such Interest Period; provided that, if the LIBOR Screen Rate shall be less than zero, such rate shall be deemed to be zero for the purposes of this Agreement and provided , further, if the LIBOR Screen Rate shall not be available at such time for such Interest Period (an “ Impacted Interest Period ”) with respect to dollars then the Eurodollar Rate shall be the Interpolated Rate ( provided , that, if any Interpolated Rate shall be less than zero, such rate shall be deemed to be zero for purposes of this Agreement).

Eurodollar Rate Loan ” means a Loan that bears interest at a rate of interest based on the Adjusted Eurodollar Rate (excluding a Base Rate Loan bearing interest by reference to the Adjusted Eurodollar Rate by virtue of clause   (c) of the definition of Base Rate).

 

8


Event of Default ” has the meaning specified in Section 8.01 .

Excluded Taxes ” means any of the following Taxes imposed on or with respect to a Recipient or required to be withheld or deducted from a payment to a Recipient, (a) Taxes imposed on or measured by net income (however denominated), franchise Taxes and branch profits Taxes, in each case, (i) imposed as a result of such Recipient being organized under the Laws of, or having its principal office or, in the case of any Lender, its applicable lending office located in, the jurisdiction imposing such Tax (or any political subdivision thereof) or (ii) that are Other Connection Taxes, (b) in the case of a Lender, U.S. federal withholding Taxes imposed on amounts payable to or for the account of such Lender with respect to an applicable interest in a Loan or Commitment or otherwise under a Loan Document pursuant to a law in effect on the date on which (i) such Lender acquires such interest in the Loan or Commitment or becomes a Lender hereunder (other than pursuant to an assignment request by the Borrower under Section 10.16 ) or (ii) such Lender changes its lending office, except in each case to the extent that, pursuant to Section 3.01(b) , amounts with respect to such Taxes were payable either to such Lender’s assignor immediately before such Lender became a party hereto or to such Lender immediately before it changed its lending office, (c) Taxes attributable to such Recipient’s failure to comply with Section 3.01(f) and (d) any U.S. federal withholding Taxes imposed under FATCA.

FATCA ” means Sections 1471 through 1474 of the Code, as of the date of this Agreement (or any amended or successor version that is substantively comparable and not materially more onerous to comply with) and any current or future regulations or official interpretations thereof, any agreements entered into pursuant to Section 1471(b)(1) of the Code and any intergovernmental agreement entered into in connection with implementation of the foregoing.

Federal Funds Effective Rate ” means, for any day, the weighted average (rounded upwards, if necessary, to the next 1/100 of 1%) of the rates calculated by the NYFRB based on such day’s federal funds transactions by depositary institutions, as determined in such manner as the NYFRB shall set forth on its public website from time to time, and published on the next succeeding Business Day by the NYFRB as the federal funds effective rate.

Fee Letters ” means each Fee Letter, dated as of September [    ], 2016, between the Administrative Agent and/or an Arranger, on the one hand, and Noble, on the other hand.

Foreign Lender ” means a Lender that is not a U.S. Person.

FRB ” means the Board of Governors of the Federal Reserve System of the United States.

Fresh Water Services Agreements ” means those certain Second Amended and Restated Fresh Water Services Agreements, dated effective as of March 31, 2016, consisting of the Second Amended and Restated Agreement Terms and Conditions Relating to Fresh Water Services and updated as of March 31, 2016, and each Agreement Addendum thereto executed from time to time by Noble or its Affiliates, the Borrower and one or more of its Subsidiaries, in each case, as amended by Amendment 01 thereto, effective as of September 1, 2016.

Fronting Exposure ” means, at any time there is a Defaulting Lender, (a) with respect to the L/C Issuers, such Defaulting Lender’s Pro Rata Share of the outstanding L/C Obligations other than L/C Obligations as to which such Defaulting Lender’s participation obligation has been reallocated to other Lenders or Cash Collateralized in accordance with the terms hereof and (b) with respect to the Swing Line Lenders, such Defaulting Lender’s Pro Rata Share of the outstanding Swing Line Loans other than Swing Line Loans as to which such Defaulting Lender’s participation obligation has been reallocated to other Lenders.

Fund ” has the meaning specified in Section 10.07(h) .

GAAP ” means generally accepted accounting principles in the United States set forth in the opinions and pronouncements of the Accounting Principles Board and the American Institute of Certified Public Accountants and statements and pronouncements of the Financial Accounting Standards Board or such other principles as may be approved by a significant segment of the accounting profession in the United States, that are applicable to the circumstances as of the date of determination, consistently applied.

 

9


Gas Gathering Agreements ” means those certain Second Amended and Restated Gas Gathering Agreements, dated effective as of March 31, 2016, consisting of the Second Amended and Restated Agreement Terms and Conditions Relating to Gas Gathering Services and updated as of March 31, 2016, and each Agreement Addendum thereto executed from time to time by Noble or its Affiliates, the Borrower and one or more of its Subsidiaries, in each case, as amended by Amendment 01 thereto, effective as of September 1, 2016.

General Partner ” means Noble Midstream GP LLC, a Delaware limited liability company.

Governmental Authority ” means any nation or government, any state or other political subdivision thereof, any agency, authority, instrumentality, regulatory body, court, administrative tribunal, central bank or other entity exercising executive, legislative, judicial, taxing, regulatory or administrative powers or functions of or pertaining to government (including any supra-national bodies such as the European Union or the European Central Bank).

Guarantee ” means, as to any Person, (a) any obligation, contingent or otherwise, of such Person guaranteeing or having the economic effect of guaranteeing any Debt or other obligation payable or performable by another Person (the “ primary obligor ”) in any manner, whether directly or indirectly, and including any obligation of such Person, direct or indirect, (i) to purchase or pay (or advance or supply funds for the purchase or payment of) such Debt or other obligation, (ii) to purchase or lease property, securities or services for the purpose of assuring the obligee in respect of such Debt or other obligation of the payment or performance of such Debt or other obligation, (iii) to maintain working capital, equity capital or any other financial statement condition or liquidity or level of income or cash flow of the primary obligor so as to enable the primary obligor to pay such Debt or other obligation, or (iv) entered into for the purpose of assuring in any other manner the obligee in respect of such Debt or other obligation of the payment or performance thereof or to protect such obligee against loss in respect thereof (in whole or in part), or (b) any Lien on any assets of such Person securing any Debt or other obligation of any other Person, whether or not such Debt or other obligation is assumed by such Person. The amount of any Guarantee shall be deemed to be an amount equal to the stated or determinable amount of the related primary obligation, or portion thereof, in respect of which such Guarantee is made or, if not stated or determinable, the maximum reasonably anticipated liability in respect thereof as determined by the guaranteeing Person in good faith. The term “Guarantee” as a verb has a corresponding meaning.

Guarantee Release Condition ” means the requirement that either (i) four-quarter Consolidated EBITDA for each of the four mostly recently ended fiscal quarters (for which financial statements have been delivered pursuant to Section 6.01(a) or (b) ) exceeds $250,000,000 or (ii) the Parent or the Borrower has received at least one Investment Grade Rating with a stable outlook or better.

Guarantee Release Date ” means the date on which the Guarantee Release Condition has been satisfied. If clause (i) of the Guarantee Release Condition is satisfied, the Guarantee Release Date shall be the date on which the applicable financial statements have been delivered pursuant to Section 6.01(a) or (b) and if clause (ii) of the Guarantee Release Condition is satisfied, the Guarantee Release Date shall be the date on which the Borrower delivers the applicable notice required by Section 6.01(h).

Guarantors ” means, collectively, the Parent, each direct or indirect wholly-owned Material Subsidiary existing on the Closing Date, any other direct or indirect wholly-owned Material Subsidiary that becomes a Guarantor pursuant to Section 6.10 , and any other Subsidiary of the Borrower that is a party to the Guarantee Agreement.

Guarantee Agreement ” means the Guarantee Agreement executed by each Guarantor on the Closing Date, as amended, supplemented, restated or other modified form time to time.

Hazardous Substances ” means all explosive or radioactive substances or wastes and all hazardous or toxic substances, wastes or other pollutants, including petroleum or petroleum distillates, asbestos or asbestos-containing materials, polychlorinated biphenyls, radon gas, infectious or medical wastes and all other substances or wastes of any nature regulated pursuant to any Environmental Law.

 

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Increase Effective Date ” has the meaning set forth in Section 2.15(b) .

Indemnified Liabilities ” has the meaning set forth in Section 10.05(a) .

Indemnified Taxes ” means (a) Taxes, other than Excluded Taxes, imposed on or with respect to any payment made by or on account of any obligation of any Loan Party under any Loan Document and (b) to the extent not otherwise described in (a), Other Taxes.

Indemnitees ” has the meaning set forth in Section 10.05(a) .

Information ” has the meaning set forth in Section 10.08 .

Initial Financial Statements ” means (i) the audited combined financial statements of the Parent’s predecessor and its Subsidiaries for the fiscal years ended December 31, 2014 and December 31, 2015 and (ii) the unaudited combined financial statements of the Parent’s predecessor and its Subsidiaries for the six months ended June 30, 2016, in each case as presented in the Registration Statement.

Interest Payment Date ” means, (a) as to any Eurodollar Rate Loan, the last day of each Interest Period applicable to such Loan and the Maturity Date; provided, however, that if any Interest Period for a Eurodollar Rate Loan exceeds three months, the respective dates that fall every three months after the beginning of such Interest Period shall also be Interest Payment Dates; (b) as to any Base Rate Loan (other than a Swing Line Loan), the first Business Day of each January, April, July and October and the Maturity Date; and (c) with respect to any Swing Line Loan, the day that such Loan is required to be repaid.

Interest Period ” means, with respect to any Eurodollar Rate Loan, the period commencing on the date such Eurodollar Rate Loan is disbursed or converted to or continued as a Eurodollar Rate Loan and ending on the date one, two, three or six months or one week thereafter, or such other periods as agreed to by all of the relevant Lenders, as selected by the Borrower in its Loan Notice; provided that:

(a) any Interest Period applicable to any Eurodollar Rate Loan which would otherwise end on a day that is not a Business Day shall be extended to the next succeeding Business Day unless such Business Day falls in another calendar month, in which case such Interest Period shall end on the immediately preceding Business Day;

(b) any Interest Period (other than one week) applicable to any Eurodollar Rate Loan that begins on the last Business Day of a calendar month (or on a day for which there is no numerically corresponding day in the calendar month at the end of such Interest Period) shall, subject to the provisions of clause (a) above, end on the last Business Day of the calendar month at the end of such Interest Period; and

(c) no Interest Period shall extend beyond the Maturity Date.

Interpolated Rate ” shall mean, at any time, for any Interest Period, the rate per annum (rounded to the same number of decimal places as the LIBOR Screen Rate) determined by the Administrative Agent (which determination shall be conclusive and binding absent manifest error) to be equal to the rate that results from interpolating on a linear basis between: (a) the LIBOR Screen Rate for the longest period for which the LIBOR Screen Rate is available for Dollars) that is shorter than the Impacted Interest Period; and (b) the LIBOR Screen Rate for the shortest period (for which that Screen Rate is available for dollars) that exceeds the Impacted Interest Period, in each case, at such time.

Investment ” means, as to any Person, any direct or indirect acquisition or investment by such Person, whether by means of (a) the purchase or other acquisition of the Capital Stock of another Person, (b) an Acquisition or (c) a loan, advance or capital contribution to, guarantee or assumption of debt of, or purchase or other acquisition of any other debt or equity participation or interest in, another Person, including any partnership or joint venture interest in such other Person and any arrangement pursuant to which the investor guarantees Debt of such other Person.

 

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Investment Grade Rating ” means a Public Debt Rating of (a) a BBB- rating or higher from S&P or (b) a Baa3 rating or higher from Moody’s.

IPO ” means an initial registered public offering of common units representing limited partner interests in the Parent to the public pursuant to the Registration Statement which results in the common units representing limited partner interests in the Parent being traded on a national securities exchange.

IRS ” means the United States Internal Revenue Service.

ISP ” has the meaning set forth in Section 2.03(g) .

JPM ” means JPMorgan Chase Bank, N.A., and its successors.

Laws ” means, collectively, all international, foreign, Federal, state and local statutes, treaties, rules, guidelines, regulations, ordinances, codes and administrative or judicial precedents or authorities, including the interpretation or administration thereof by any Governmental Authority charged with the enforcement, interpretation or administration thereof, and all applicable administrative orders, directed duties, requests, licenses, authorizations and permits of, and agreements with, any Governmental Authority, in each case whether or not having the force of law.

L/C Advance ” means, with respect to each Lender, such Lender’s funding of its participation in any L/C Borrowing in accordance with its Pro Rata Share.

L/C Borrowing ” means an extension of credit from an L/C Issuer resulting from a drawing under any Letter of Credit which has not been reimbursed by the Borrower on the date when made or refinanced as a Borrowing.

L/C Credit Extension ” means, with respect to any Letter of Credit, the issuance thereof or extension of the expiry date thereof, or the increase of the amount thereof.

L/C Issuers ” means JPM, DNB Bank ASA, New York Branch, Bank of America, N.A. and Barclays Bank PLC, each in its capacity as an issuer of Letters of Credit hereunder, and any successor issuer of Letters of Credit hereunder.

L/C Issuer Related Persons ” means each L/C Issuer, together with its respective Affiliates, and the officers, directors, employees, agents and attorneys-in-fact of such Persons and Affiliates.

L/C Obligations ” means, as at any date of determination, the aggregate undrawn amount of all outstanding Letters of Credit plus the aggregate of all Unreimbursed Amounts (including all L/C Borrowings). For purposes of computing the amount available to be drawn under any Letter of Credit, the amount of such Letter of Credit shall be determined in accordance with Section 1.07 . For all purposes of this Agreement, if on any date of determination a Letter of Credit has expired by its terms but any amount may still be drawn thereunder by reason of the operation of Rule 3.14 of the ISP, such Letter of Credit shall be deemed to be “outstanding” in the amount so remaining available to be drawn.

Lenders ” means those Lenders with a Commitment, or if the Commitments have been terminated pursuant to Section 8.02 , Lenders holding the outstanding Loans, if any, and as the context requires, the Swing Line Lenders.

Lending Office ” means, as to any Lender, the office or offices of such Lender described as such in such Lender’s Administrative Questionnaire, or such other office or offices as a Lender may from time to time notify the Borrower and the Administrative Agent.

Letter of Credit ” means any standby letter of credit issued on or after the Closing Date hereunder.

 

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Letter of Credit Application ” means an application, an application and agreement, or other similar document in the nature of an application required by the applicable L/C Issuer, for the issuance or amendment of a Letter of Credit, in the form from time to time in use by such L/C Issuer.

Letter of Credit Expiration Date ” means the day that is seven days prior to the Stated Maturity Date (or, if such day is not a Business Day, the next preceding Business Day).

Letter of Credit Sublimit ” means an amount equal to $100,000,000, as such amount may be reduced pursuant to Section 2.06 . The Letter of Credit Sublimit is part of, and not in addition to, the Aggregate Commitment.

Lien ” means any mortgage, pledge, hypothecation, assignment, deposit arrangement, encumbrance, lien (statutory or other), charge, or preference, priority or other security interest or preferential arrangement of any kind or nature whatsoever (including any conditional sale or other title retention agreement, and any financing lease having substantially the same economic effect as any of the foregoing).

Loan ” means an extension of credit by a Lender to the Borrower under Article II in the form of a Loan (including a Swing Line Loan).

Loan Documents ” means this Agreement, each Note, the Guarantee Agreement, the Fee Letters, each agreement creating or perfecting rights in Cash Collateral, and each other document executed by a Loan Party which contains a provision stating that it is a “Loan Document”.

Loan Notice ” means a notice of (a) a Borrowing of Loans, (b) a conversion of Loans from one Type to the other or (c) a continuation of Eurodollar Rate Loans, pursuant to Section 2.02(a) , which shall be substantially in the form of Exhibit A-1 .

Loan Parties ” means, collectively, the Borrower, the Parent and the other Guarantors from time to time party to the Guarantee Agreement.

Master Agreement ” has the meaning set forth in the definition of Swap Contract.

Material Adverse Effect ” means (a) a material adverse change in the operations, business or financial condition of the Parent and its Subsidiaries, taken as a whole, (b) a material impairment of the ability of the Loan Parties, taken as a whole, to perform their payment obligations under the Loan Documents or (c) a material adverse effect upon the legality, validity, binding effect or enforceability against the Loan Parties of the Loan Documents, taken as a whole.

Material Contracts ” means (a) the Omnibus Agreement, (b) the Gas Gathering Agreements, (c) the Oil Gathering Agreements, (d) the Oil Treating Agreements, (e) the Produced Water Services Agreements (f) the Fresh Water Services Agreements, and (g) any other documents, agreements or instruments entered into between Noble or its Affiliates and any Loan Party or Subsidiary, which, if breached, terminated or cancelled, could reasonably be expected to have a Material Adverse Effect.

Material Debt ” means Debt (other than the Loans) of the Parent and its Subsidiaries, arising in one or more related or unrelated transactions, in an aggregate principal or face amount exceeding the Threshold Amount.

Material Disposition ” means the Disposition by any Person, in a single transaction or in a series of related transactions, of either (a) property or assets constituting a business unit or division of such Person to another Person or (b) a majority or greater of the securities having ordinary voting power for the election of directors, managing general partners or the equivalent of a Subsidiary of such Person to another Person, in each case whether or not involving a merger or consolidation with such other Person.

Material Plan ” means, at any time, a Plan or Plans having aggregate Unfunded Liabilities in excess of the Threshold Amount.

 

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Material Subsidiary ” means any direct or indirect domestic Subsidiary of the Parent for which (a) its assets and the assets of its consolidated Subsidiaries comprise more than 5% of the assets of the Parent and its Subsidiaries on a consolidated basis, or (b) its revenue and the revenue of its consolidated Subsidiaries comprise more than 5% of the revenue of the Parent and its Subsidiaries on a consolidated basis, in each case determined on a consolidated basis in accordance with GAAP as of the end of the most recent fiscal year.

Materials ” has the meaning specified in Section 6.01 .

Maturity Date ” means the earlier of (a) the Stated Maturity Date and (b) the effective date of any other termination, cancellation, or acceleration of all Commitments under this Agreement.

Midstream Drop Down Acquisition ” means the acquisition by any Loan Party or one or more of its Subsidiaries, in a single transaction or in a series of related transactions, of property or assets from Noble or its Subsidiaries so long as the property or assets being acquired are engaged or used (or intended to be used), as applicable, primarily in an activity that would generate qualifying income within the meaning of Section 7704(d) of the Code.

Minimum Collateral Amount ” means, at any time, an amount equal to 102% of the Fronting Exposure applicable to any Defaulting Lender with respect to Letters of Credit issued and outstanding at such time.

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

Multiemployer Plan ” means, at any time, an employee pension benefit plan within the meaning of Section 3(37) or Section 4001(a)(3) of ERISA to which any member of the ERISA Group is then making or accruing an obligation to make contributions, or has within the preceding five plan years made contributions, including for these purposes any Person which ceased to be a member of the ERISA Group during such five year period.

Multiple Employer Plan ” means a Plan which has two or more contributing sponsors (including any member of the ERISA Group) at least two of whom are not under common control, as such a plan is described in Section 4064 of ERISA.

Noble ” means Noble Energy, Inc., a Delaware corporation.

Non-Consenting Lender ” means any Lender that does not approve any consent, waiver or amendment that (a) requires the approval of each Lender or all directly affected Lenders in accordance with the terms of Section 10.01 and (b) has been approved by the Required Lenders.

Non-Defaulting Lender ” means, at any time, each Lender that is not a Defaulting Lender at such time.

Note ” means a Revolving Note or a Swing Line Note.

NYFRB ” means the Federal Reserve Bank of New York.

NYFRB Rate ” means, for any day, the greater of (a) the Federal Funds Effective Rate in effect on such day and (b) the Overnight Bank Funding Rate in effect on such day (or for any day that is not a Business Day, for the immediately preceding Business Day); provided that if none of such rates are published for any day that is a Business Day, the term “NYFRB Rate” means the rate for a federal funds transaction quoted at at 11:00 a.m. on such day received to the Administrative Agent from a Federal funds broker of recognized standing selected by it; provided, further, that if any of the aforesaid rates shall be less than zero, such rate shall be deemed to be zero for purposes of this Agreement.

Obligations ” means all advances to, and debts, liabilities, obligations, covenants and duties of, the Loan Parties arising under any Loan Document or otherwise with respect to any Loan or Letter of Credit, whether direct or indirect (including those acquired by assumption), absolute or contingent, due or to become due, now existing or

 

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hereafter arising and including interest and fees that accrue after the commencement by or against any Loan Party or any Affiliate of such Loan Party of any proceeding under any Debtor Relief Laws naming such Person as the debtor in such proceeding, regardless of whether such interest and fees are allowed claims in such proceeding.

Oil Gathering Agreements ” means those certain Second Amended and Restated Crude Oil Gathering Agreements, dated effective as of March 31, 2016, consisting of the Second Amended and Restated Agreement Terms and Conditions Relating to Crude Oil Gathering Services and updated as of March 31, 2016, and each Agreement Addendum thereto executed from time to time by Noble or its Affiliates, the Borrower and one or more of its Subsidiaries, in each case, as amended by Amendment 01 thereto, effective as of September 1, 2016.

Oil Treating Agreements ” means those certain Third Amended and Restated Crude Oil Treating Agreements, dated effective as of March 31, 2016, consisting of the Third Amended and Restated Agreement Terms and Conditions Relating to Crude Oil Treating Services and updated as of March 31, 2016, and each Agreement Addendum thereto executed from time to time by Noble or its Affiliates, the Borrower and one or more of its Subsidiaries.

Omnibus Agreement ” means the Omnibus Agreement dated as of the date of this Agreement, by and between Noble, Borrower and the other parties named therein.

Organization Documents ” means (a) with respect to any corporation, the certificate or articles of incorporation and the bylaws (or equivalent or comparable constitutive documents with respect to any non-U.S. jurisdiction); (b) with respect to any limited liability company, the certificate or articles of formation or organization and operating agreement; and (c) with respect to any partnership, joint venture, trust or other form of business entity, the partnership, joint venture or other applicable agreement of formation or organization and, if applicable, any certificate or articles of formation or organization of such entity.

Other Connection Taxes ” means, with respect to any Recipient, Taxes imposed as a result of a present or former connection between such Recipient (or an agent or affiliate thereof) and the jurisdiction imposing such Tax (other than connections arising from such Recipient having executed, delivered, become a party to, performed its obligations under, received payments under, received or perfected a security interest under, engaged in any other transaction pursuant to or enforced any Loan Document, or sold or assigned an interest in any Loan or Loan Document).

Other Taxes ” means all present or future stamp, court, documentary, intangible, recording, filing or similar Taxes that arise from any payment made under, from the execution, delivery, performance, enforcement or registration of, from the receipt or perfection of a security interest under, or otherwise with respect to, any Loan Document except any such Taxes that are Other Connection Taxes imposed with respect to an assignment (other than an assignment made pursuant to Section 10.16) .

Outstanding Amount ” means (a) with respect to Loans on any date, the aggregate outstanding principal amount thereof after giving effect to any borrowings and prepayments or repayments of such Loans occurring on such date; (b) with respect to Swing Line Loans on any date, the aggregate outstanding principal amount thereof after giving effect to any borrowings and prepayments or repayments of such Swing Line Loans occurring on such date; and (c) with respect to any L/C Obligations on any date, the amount of such L/C Obligations on such date after giving effect to any L/C Credit Extension occurring on such date and any other changes in the aggregate amount of the L/C Obligations as of such date, including as a result of any reimbursements of outstanding unpaid drawings under any Letters of Credit or any reductions in the maximum amount available for drawing under Letters of Credit taking effect on such date.

Overnight Bank Funding Rate ” means, for any day, the rate comprised of both overnight federal funds and overnight Eurodollar borrowings by U.S.-managed banking offices of depository institutions, as such composite rate shall be determined by the NYFRB as set forth on its public website from time to time, and published on the next succeeding Business Day by the NYFRB as an overnight bank funding rate (from and after such date as the NYFRB shall commence to publish such composite rate).

 

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Parent ” has the meaning specified in the introductory paragraph hereto.

Participant ” has the meaning specified in Section 10.07(d) .

Participant Register ” has the meaning specified in Section 10.07(d) .

Partnership Agreement ” means the First Amended and Restated Agreement of Limited Partnership of the Parent, in substantially the form attached to the Registration Statement on the Closing Date, as modified from time to time in a manner not prohibited by this Agreement.

Patriot Act ” has the meaning set specified in Section 10.20 .

PBGC ” means the Pension Benefit Guaranty Corporation or any entity succeeding to any or all of its functions under ERISA.

Pension Act ” means the Pension Protection Act of 2006.

Pension Funding Rules ” means the rules of the Code and ERISA regarding minimum required contributions (including any installment payment thereof) to Pension Plans and set forth in, with respect to plan years ending prior to the effective date of the Pension Act, Section 412 of the Code and Section 302 of ERISA, each as in effect prior to the Pension Act and, thereafter, Section 412, 430, 431, 432 and 436 of the Code and Sections 302, 303, 304 and 305 of ERISA.

Pension Plan ” means any employee pension benefit plan (including a Multiple Employer Plan or a Multiemployer Plan) that is maintained or is contributed to by any member of the ERISA Group and is either covered by Title IV of ERISA or is subject to the minimum funding standards under Section 412 of the Code.

Person ” means any natural person, corporation, limited liability company, trust, joint venture, association, company, partnership, Governmental Authority or other entity.

Plan ” means at any time an employee pension benefit plan (other than a Multiemployer Plan) which is covered by Title IV of ERISA or subject to the minimum funding standards under Section 412 of the Code and either (i) is maintained, or contributed to, by any member of the ERISA Group for employees of any member of the ERISA Group or (ii) has at any time within the preceding five years been maintained, or contributed to, by any Person which was at such time a member of the ERISA Group for employees of any Person which was at such time a member of the ERISA Group.

Platform ” has the meaning set forth in Section 6.01 .

Prime Rate ” means the rate of interest per annum publicly announced from time to time by JPM as its prime rate in effect at its office located at 270 Park Avenue, New York, New York; each change in the Prime Rate shall be effective from and including the date such change is publicly announced as being effective.

Pro Forma Financial Statements ” means the pro forma unaudited condensed combined financial statements of the Parent and its Material Subsidiaries for the fiscal year ended December 31, 2015 and for the six month period ended June 30, 2016, in each case, as presented in the Registration Statement.

Pro Rata Share ” means, with respect to each Lender at any time, a fraction (expressed as a percentage, carried out to the ninth decimal place), the numerator of which is the amount of the Commitment of such Lender at such time and the denominator of which is the amount of the Aggregate Commitment at such time; provided that, if the commitment of each Lender to make Loans has been terminated pursuant to Section 8.02 , then the Pro Rata Share of each Lender shall be determined based on the Pro Rata Share of such Lender immediately prior to such termination and after giving effect to any subsequent assignments made pursuant to the terms hereof. When a Defaulting Lender shall exist, “Pro Rata Share” shall be calculated without including any Defaulting Lender’s Commitment. The initial Pro Rata Shares of each Lender are set forth opposite the name of such Lender on

 

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Schedule   2.01 or, if such Lender becomes a Lender pursuant to Section 2.15 , then in the applicable amendment to this Agreement giving effect to the applicable Increase Effective Date, or in the Assignment and Assumption pursuant to which such Lender becomes a party hereto, as applicable.

Produced Water Services Agreements ” means those certain Second Amended and Restated Produced Water Services Agreements, dated effective as of March 31, 2016, consisting of the Second Amended and Restated Agreement Terms and Conditions Relating to Produced Water Services and updated as of March 31, 2016, and each Agreement Addendum thereto executed from time to time by Noble or its Affiliates, the Borrower and one or more of its Subsidiaries, in each case, as amended by Amendment 01 thereto, effective as of September 1, 2016.

Public Debt Ratings ” means a rating to be based on the Parent’s or Borrower’s long-term senior unsecured non-credit enhanced debt ratings established by S&P and/or Moody’s.

Qualified Acquisition ” means an Acquisition or an Investment in any Subsidiary pursuant to Section 7.10 by the Parent or any Subsidiary, the aggregate purchase price for which, when combined with the aggregate purchase price for all other Acquisitions or such Investments by the Parent or any Subsidiary over the trailing twelve (12) month period, is greater than or equal to $25,000,000.

Qualified Acquisition Period ” means the period beginning on the date the Parent or any Subsidiary consummates a Qualified Acquisition and ending on the last day of the second full fiscal quarter following the fiscal quarter in which such Qualified Acquisition occurred.

Qualified Project ” means the construction or expansion of any capital project of the Parent or any of its Subsidiaries, the aggregate capital cost of which exceeds $20,000,000.

Qualified Project EBITDA Adjustments ” shall mean, with respect to each Qualified Project:

(a) prior to the Commercial Operation Date of a Qualified Project (but including the fiscal quarter in which such Commercial Operation Date occurs), a percentage (based on the then-current completion percentage of such Qualified Project) of an amount (determined by the Parent in good faith in a commercially reasonable manner and certified by the chief financial officer of the General Partner, on behalf of the Parent) to be approved by the Administrative Agent as the projected Consolidated EBITDA of the Parent and its Subsidiaries attributable to such Qualified Project for the first twelve (12) month period following the scheduled Commercial Operation Date of such Qualified Project (such amount to be determined based on customer commitments and related contracts in connection with such Qualified Project, the creditworthiness of the other parties to such contracts, and projected revenues from such contracts, capital costs and expenses, scheduled Commercial Operation Date and other reasonable factors deemed appropriate by the Administrative Agent), which may, at the Parent’s option, be added to actual Consolidated EBITDA for the Parent and its Subsidiaries for the fiscal quarter in which construction of such Qualified Project commences and for each fiscal quarter thereafter until the Commercial Operation Date of such Qualified Project (including the fiscal quarter in which such Commercial Operation Date occurs, but net of any actual Consolidated EBITDA of the Parent and its Subsidiaries attributable to such Qualified Project following such Commercial Operation Date); provided that if the actual Commercial Operation Date does not occur by the scheduled Commercial Operation Date, then the foregoing amount shall be reduced, for quarters ending after the scheduled Commercial Operation Date to (but excluding) the first full quarter after its actual Commercial Operation Date, by the following percentage amounts depending on the period of delay (based on the period of actual delay or then-estimated delay, whichever is longer): (i) 90 days or less, 0%, (ii) longer than 90 days, but not more than 180 days, 25%, (iii) longer than 180 days but not more than 270 days, 50%, and (iv) longer than 270 days, 100%; and

(b) thereafter, actual Consolidated EBITDA of the Parent and its Subsidiaries attributable to such Qualified Project for each full fiscal quarter after the Commercial Operation Date, plus the amount approved by Administrative Agent pursuant to paragraph (a) above as the projected Consolidated EBITDA of Parent and its Subsidiaries attributable to such Qualified Project for the fiscal quarters constituting the balance of the full four fiscal quarter period following such Commercial Operation Date; provided , in the event the actual Consolidated EBITDA of the Parent and its Subsidiaries attributable to such Qualified Project for any full fiscal quarter after the Commercial Operation Date shall materially differ from the projected Consolidated EBITDA approved by

 

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Administrative Agent pursuant to paragraph (a) above for such fiscal quarter, the projected Consolidated EBITDA of Parent and its Subsidiaries attributable to such Qualified Project for any remaining fiscal quarters included in the foregoing calculation shall be redetermined in the same manner as set forth in paragraph (a) above, such amount to be approved by the Administrative Agent, which may, at the Parent’s option, be added to actual Consolidated EBITDA for the Parent and its Subsidiaries for such fiscal quarters.

Notwithstanding the foregoing:

(A) no such additions shall be allowed with respect to any Qualified Project unless:

(1) not later than 30 days (or such shorter time as the Administrative Agent may agree in its sole discretion) prior to the delivery of any certificate required by the terms and provisions of Section   6.01(c) to the extent Qualified Project EBITDA Adjustments will be made to Consolidated EBITDA in determining compliance with Section 7.02 , the Borrower shall have delivered to the Administrative Agent written pro forma projections of Consolidated EBITDA of the Parent and its Subsidiaries attributable to such Qualified Project; and

(2) prior to the date such certificate is required to be delivered, the Administrative Agent shall have approved (such approval not to be unreasonably withheld) such projections and shall have received such other information and documentation as the Administrative Agent may reasonably request, all in form and substance satisfactory to the Administrative Agent;

(B) the aggregate amount of all Qualified Project EBITDA Adjustments during any period shall be limited to 15% of the total actual Consolidated EBITDA of the Parent and its Subsidiaries for such period (which total actual Consolidated EBITDA shall be determined without including any Qualified Project EBITDA Adjustments); and

(C) for the avoidance of doubt the foregoing Consolidated EBITDA adjustments, shall be adjusted with respect to the portion of Consolidated EBITDA which would be attributable to any non-wholly owned Subsidiaries of the Parent, to reflect only the Parent’s pro rata ownership interest in such Subsidiaries.

Recipient ” means (a) the Administrative Agent, (b) any Lender and (c) any L/C Issuer, as applicable.

Register ” has the meaning set forth in Section 10.07(c) .

Registration Statement ” means the Parent’s Form S-1 Registration Statement No. 333-207560, including the prospectus forming a part thereof and the exhibits filed therewith, initially filed publicly by the Parent with the SEC on October 22, 2015, as amended from time to time.

Reimbursement Date ” has the meaning set forth in Section 2.03(c)(i) .

Related Parties ” means, with respect to any Person, such Person’s Affiliates and the partners, directors, officers, employees, agents, trustees and advisors of such Person and of such Person’s Affiliates.

Request for Credit Extension ” means (a) with respect to a Borrowing, conversion or continuation of Loans, a Loan Notice, (b) with respect to an L/C Credit Extension, a Letter of Credit Application, and (c) with respect to a Swing Line Loan, a Swing Line Loan Notice.

Required Lenders ” means, as of any date of determination, Lenders having greater than 50% of the Aggregate Commitment or, if the commitment of each Lender to make Loans and the obligation of each L/C Issuer to make L/C Credit Extensions have been terminated pursuant to Section 8.02 , Lenders holding in the aggregate greater than 50% of the Total Outstandings (with the aggregate amount of each Lender’s risk participation and funded participation in L/C Obligations and Swing Line Loans being deemed “held” by such Lender for purposes of this definition); provided that the Commitment of, and the portion of the Total Outstandings held or deemed held by, any Defaulting Lender shall be excluded for purposes of making a determination of Required Lenders.

 

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Responsible Officer ” means, with respect to any Person, the chief executive officer, president, executive vice president, senior vice president, chief financial officer, principal accounting officer, treasurer or assistant treasurer of such Person. Any document delivered hereunder that is signed by a Responsible Officer of the General Partner, on behalf of the Parent, shall be conclusively presumed to have been authorized by all necessary corporate, partnership and/or other action on the part of the Parent and such Responsible Officer shall be conclusively presumed to have acted on behalf of the Parent.

Restricted Payment ” means any dividend or other distribution (whether in cash, securities or other property) with respect to Capital Stock of a Loan Party or any Subsidiary, or any payment (whether in cash, securities or other property), including any sinking fund or similar deposit, on account of the purchase, redemption, retirement, acquisition, cancellation or termination of any such Capital Stock or on account of any return of capital to a Loan Party’s stockholders, partners or members (or the equivalent Person thereof), or any setting apart of funds or assets for any of the foregoing.

Revolving Note ” means a promissory note made by the Borrower in favor of a Lender evidencing Loans made by such Lender, substantially in the form of Exhibit B-1 .

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

Sanctioned Country ” means, at any time, a country, region or territory which is, or whose government is, the subject or target of any Sanctions (as of the date hereof, Crimea, Cuba, Iran, North Korea, Sudan and Syria).

Sanctioned Person ” means, at any time, (a) any Person listed in any Sanctions-related list of designated Persons maintained by the Office of Foreign Assets Control of the U.S. Department of the Treasury, the U.S. Department of State or by the United Nations Security Council, the European Union, any EU member state or Her Majesty’s Treasury of the United Kingdom, (b) any Person operating, organized or resident in a Sanctioned Country or (c) any Person controlled by any such Person or Persons, in each case, to the extent dealings are prohibited or restricted with such Person under Sanctions.

Sanctions ” means economic or financial sanctions or trade embargoes imposed, administered or enforced from time to time by (a) the U.S. government, including those administered by the Office of Foreign Assets Control of the U.S. Department of the Treasury or the U.S. Department of State, or (b) the United Nations Security Council, the European Union, any EU member state or Her Majesty’s Treasury of the United Kingdom.

Solvent ” means, with respect to any Person as of a particular date, that on such date (a) such Person is able to pay its debts and other liabilities, contingent obligations and other commitments as they mature in the normal course of business, (b) such Person does not intend to, and does not believe that it will, incur debts or liabilities beyond such Person’s ability to pay as such debts and liabilities mature in their ordinary course, (c) such Person is not engaged in a business or a transaction, and is not about to engage in a business or a transaction, for which such Person’s assets would constitute unreasonably small capital after giving due consideration to the prevailing practice in the industry in which such Person is engaged or is to engage, (d) the fair value of the assets of such Person is greater than the total amount of liabilities, including, without limitation, contingent liabilities, of such Person and (e) the present fair saleable value of the assets of such Person is not less than the amount that will be required to pay the probable liability of such Person on its debts as they become absolute and matured. In computing the amount of contingent liabilities at any time, it is intended that such liabilities will be computed as the amount which, in light of all the facts and circumstances existing at such time, represents the amount that can reasonably be expected to become an actual or matured liability.

Stated Maturity Date ” means the date that is the five year anniversary of the Closing Date.

 

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Statutory Reserve Rate ” means a fraction (expressed as a decimal), the numerator of which is the number one and the denominator of which is the number one minus the aggregate of the maximum reserve percentage (including any marginal, special, emergency or supplemental reserves) expressed as a decimal established by the Board to which the Administrative Agent is subject with respect to the Adjusted Eurodollar Rate, for eurocurrency funding (currently referred to as “Eurocurrency Liabilities” in Regulation D of the FRB). Such reserve percentage shall include those imposed pursuant to such Regulation D. Eurodollar Rate Loans shall be deemed to constitute eurocurrency funding and to be subject to such reserve requirements without benefit of or credit for proration, exemptions or offsets that may be available from time to time to any Lender under such Regulation D or any comparable regulation. The Statutory Reserve Rate shall be adjusted automatically on and as of the effective date of any change in any reserve percentage.

Subsidiary ” of a Person means a corporation, partnership, joint venture, limited liability company or other business entity of which a majority of the shares of securities or other interests having ordinary voting power for the election of directors or other governing body (other than securities or interests having such power only by reason of the happening of a contingency) are at the time beneficially owned, or the management of which is otherwise controlled, directly, or indirectly through one or more intermediaries, or both, by such Person. Unless otherwise specified, all references herein to a “Subsidiary” or to “Subsidiaries” shall refer to a Subsidiary or Subsidiaries of the Parent.

Swap Contract ” means (a) any and all rate swap transactions, basis swaps, credit derivative transactions, forward rate transactions, commodity swaps, commodity options, forward commodity contracts, equity or equity index swaps or options, bond or bond price or bond index swaps or options or forward bond or forward bond price or forward bond index transactions, interest rate options, forward foreign exchange transactions, cap transactions, floor transactions, collar transactions, currency swap transactions, cross-currency rate swap transactions, currency options, spot contracts, futures contracts traded on or subject to the rules of a designated contract market, or any other similar transactions or any combination of any of the foregoing (including any options to enter into any of the foregoing), whether or not any such transaction is governed by or subject to any master agreement, and (b) any and all transactions of any kind, and the related confirmations, which are subject to the terms and conditions of, or governed by, any form of master agreement published by the International Swaps and Derivatives Association, Inc., any International Foreign Exchange Master Agreement, any North American Energy Standard Board Master Agreement, or any other master agreement (any such master agreement, together with any related schedules, a “ Master Agreement ”), including any such obligations or liabilities under any Master Agreement.

Swap Termination Value ” means, in respect of any one or more Swap Contracts, after taking into account the effect of any legally enforceable netting agreement relating to such Swap Contracts, (a) for any date on or after the date such Swap Contracts have been closed out and termination value(s) determined in accordance therewith, such termination value(s) and (b) for any date prior to the date referenced in clause (a) , the amount(s) determined as the mark-to-market value(s) for such Swap Contracts, as determined based upon the average of at least two mid-market or other readily available commercially reasonable quotations provided by any leading dealer in such Swap Contracts (one of which may be a Lender or an Affiliate of a Lender).

Swing Line ” means the revolving credit facility made available by the Swing Line Lenders pursuant to Section   2.04 .

Swing Line Borrowing ” means a Borrowing of a Swing Line Loan pursuant to Section 2.04 .

Swing Line Lenders ” means JPM and Bank of America, N.A., each in its capacity as provider of Swing Line Loans, or any successor swing line lender hereunder.

Swing Line Loan ” has the meaning specified in Section 2.04(a) .

Swing Line Loan Notice ” means a notice of a Borrowing of Swing Line Loans, which, if in writing, shall be substantially in the form of Exhibit A-2 .

 

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Swing Line Note ” means a promissory note made by the Borrower in favor of a Swing Line Lender evidencing Swing Line Loans made by such Swing Line Lender, substantially in the form of Exhibit B-2 .

Swing Line Sublimit ” means an amount equal to $60,000,000, as such amount may be reduced pursuant to Section 2.06 . The Swing Line Sublimit is part of, and not in addition to, the Aggregate Commitment.

Synthetic Lease Obligation ” means the monetary obligation of a Person under (a) a so-called synthetic, off-balance sheet or tax retention lease, or (b) an agreement for the use or possession of property creating obligations that do not appear on the balance sheet of such Person but which, upon the insolvency or bankruptcy of such Person, would be characterized as the indebtedness of such Person (without regard to accounting treatment).

Taxes ” means all present or future taxes, levies, imposts, duties, deductions, withholdings (including backup withholding), assessments, fees or other charges imposed by any Governmental Authority, including any interest, fines, additions to tax or penalties applicable thereto.

Threshold Amount ” means the greater of (a) $35,000,000 or (b) 10% of the Aggregate Commitment; provided , such amount shall not exceed $50,000,000.

Total Outstandings ” means the aggregate Outstanding Amount of all Loans (including Swing Line Loans) and all L/C Obligations.

Transactions ” means, collectively, (i) the execution, delivery and performance of this Agreement and the other Loan Documents, the borrowing of Loans, the use of the proceeds thereof and the issuance of Letters of Credit hereunder, (ii) the consummation of the IPO and (iii) the payment of fees and expenses in connection with the foregoing.

Type ” means, with respect to a Loan, its character as a Base Rate Loan or a Eurodollar Rate Loan.

Unfunded Liabilities ” means, with respect to any Plan at any time, the amount (if any) by which (a) the value of all benefit liabilities under such Plan, determined on a plan termination basis using the assumptions prescribed by the PBGC for purposes of Section 4044 of ERISA, exceeds (b) the fair market value of all Plan assets allocable to such liabilities under Title IV of ERISA (excluding any accrued but unpaid contributions), all determined as of the then most recent valuation date for such Plan, but only to the extent that such excess represents a potential liability of a member of the ERISA Group to the PBGC or any other Person under Title IV of ERISA.

United States ” and “ U.S. ” mean the United States of America.

Unreimbursed Amount ” has the meaning set forth in Section 2.03(c)(i) .

U.S. Person ” means any Person that is a “United States person” as defined in Section 7701(a)(30) of the Code.

U.S. Tax Compliance Certificate ” has the meaning assigned to such term in Section 3.01(f) .

Voting Stock ” of any Person as of any date means the Capital Stock of such Person that is at the time entitled (without regard to the occurrence of any contingency) to vote in the election of the Board of Directors (or similar governing body) of such Person.

Withholding Agent ” means any Loan Party and the Administrative Agent.

Write-Down and Conversion Powers ” means, with respect to any EEA Resolution Authority, the write-down and conversion powers of such EEA Resolution Authority from time to time under the Bail-In Legislation for the applicable EEA Member Country, which write-down and conversion powers are described in the EU Bail-In Legislation Schedule.

 

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1.02 Other Interpretive Provisions . With reference to this Agreement and each other Loan Document, unless otherwise specified herein or in such other Loan Document:

(a) The meanings of defined terms are equally applicable to the singular and plural forms of the defined terms.

(b) (i) The words “herein,” “hereto,” “hereof” and “hereunder” and words of similar import when used in any Loan Document shall refer to such Loan Document as a whole and not to any particular provision thereof.

(ii) Article, Section, Exhibit and Schedule references are to the Loan Document in which such reference appears.

(iii) The term “including” is by way of example and not limitation.

(iv) The term “documents” includes any and all instruments, documents, agreements, certificates, notices, reports, financial statements and other writings, however evidenced, whether in physical or electronic form.

(v) The word “will” shall be construed to have the same meaning and effect as the word “shall.”

(vi) Unless the context requires otherwise, any reference herein to any Person shall be construed to include such Person’s successors and assigns.

(vii) The words “asset” and “property” shall be construed to have the same meaning and effect and to refer to any and all tangible and intangible assets and properties, including cash, securities, accounts and contract rights.

(c) In the computation of periods of time from a specified date to a later specified date, the word “from” means “from and including”; the words “to” and “until” each mean “to but excluding”; and the word “through” means “to and including.”

(d) Section headings herein and in the other Loan Documents are included for convenience of reference only and shall not affect the interpretation of this Agreement or any other Loan Document.

1.03 Accounting Terms .

(a) All accounting terms not specifically or completely defined herein shall be construed in conformity with, and all financial data (including financial ratios and other financial calculations) required to be submitted pursuant to this Agreement shall be prepared in conformity with, GAAP applied on a consistent basis, as in effect from time to time.

(b) If at any time any change in GAAP would affect the computation of any financial ratio or requirement set forth in any Loan Document, and either the Parent, the Borrower or the Required Lenders shall so request, the Administrative Agent, the Lenders, the Parent and the Borrower shall negotiate in good faith to amend such ratio or requirement to preserve the original intent thereof in light of such change in GAAP (subject to the approval of the Required Lenders); provided that, until so amended, (i) such ratio or requirement shall continue to be computed in accordance with GAAP prior to such change therein and (ii) the Borrower shall provide to the Administrative Agent and the Lenders financial statements and other documents required under this Agreement or as reasonably requested hereunder setting forth a reconciliation between calculations of such ratio or requirement made before and after giving effect to such change in GAAP. Notwithstanding anything to the contrary in this Agreement or any other Loan Document, for purposes of calculations made pursuant to the terms of this Agreement or any other Loan Document, GAAP will be deemed to treat leases that would have been classified as operating leases in accordance with generally accepted accounting principles in the United States as in effect on December 31, 2015 in

 

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a manner consistent with the treatment of such leases under generally accepted accounting principles in the United States as in effect on December 31, 2015, notwithstanding any modifications or interpretive changes thereto that may occur thereafter.

(c) Calculations . Notwithstanding anything in this Agreement to the contrary:

(i) For purposes of calculating compliance with the financial covenants set forth in Section   7.02 , with respect to all Acquisitions, Investments in Subsidiaries permitted pursuant to Section 7.10 and Material Dispositions, Consolidated EBITDA, Consolidated Interest Charges and Consolidated Funded Debt with respect to such newly acquired or Disposed assets shall be calculated on a pro forma basis as if such Acquisition, Investment or Material Disposition had occurred at the beginning of the applicable twelve month period of determination.

(ii) For purposes of calculating compliance with the financial covenants set forth in Section   7.02 , Consolidated EBITDA may include, at Parent’s option, any Qualified Project EBITDA Adjustments as provided in the definition thereof.

1.04 Rounding . Any financial ratios required to be maintained by the Parent pursuant to this Agreement shall be calculated by dividing the appropriate component by the other component, carrying the result to one place more than the number of places by which such ratio is expressed herein and rounding the result up or down to the nearest number (with a rounding-up if there is no nearest number).

1.05 References to Agreements and Laws . Unless otherwise expressly provided herein, (a) references to Organization Documents, agreements (including the Loan Documents) and other contractual instruments shall be deemed to include all subsequent amendments, restatements, extensions, supplements and other modifications thereto, but only to the extent that such amendments, restatements, extensions, supplements and other modifications are not prohibited by any Loan Document; and (b) references to any Law shall include all statutory and regulatory provisions consolidating, amending, replacing, supplementing or interpreting such Law.

1.06 Times of Day . Unless otherwise specified, all references herein to times of day shall be references to Eastern time (daylight or standard, as applicable).

1.07 Letter of Credit Amounts . Unless otherwise specified, all references herein to the amount of a Letter of Credit at any time shall be deemed to mean the maximum face amount of such Letter of Credit after giving effect to all increases thereof contemplated by such Letter of Credit or the Letter of Credit Application therefor, whether or not such maximum face amount is in effect at such time.

ARTICLE II

THE COMMITMENTS AND BORROWINGS

2.01 The Loans . Subject to the terms and conditions set forth herein, each Lender severally agrees to make loans to the Borrower from time to time, in Dollars, on any Business Day during the Availability Period, in an aggregate amount not to exceed at any time outstanding the amount of such Lender’s Commitment; provided, however, that after giving effect to any Borrowing, (i) the Total Outstandings shall not exceed the Aggregate Commitment, and (ii) the aggregate Outstanding Amount of the Loans of any Lender, plus such Lender’s Pro Rata Share of the Outstanding Amount of all L/C Obligations, plus such Lender’s Pro Rata Share of the Outstanding Amount of all Swing Line Loans shall not exceed such Lender’s Commitment. Within the limits of each Lender’s Commitment, and subject to the other terms and conditions hereof, the Borrower may borrow under this Section 2.01 , prepay under Section 2.05 , and reborrow under this Section 2.01 . Loans may be Base Rate Loans or Eurodollar Rate Loans, as further provided herein.

 

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2.02 Borrowings, Conversions and Continuations of Loans .

(a) Each Borrowing, each conversion of Loans from one Type to the other, and each continuation of Eurodollar Rate Loans shall be made upon the Borrower’s delivery to the Administrative Agent of an irrevocable written Loan Notice, appropriately completed and signed by or on behalf of the Borrower, which may be delivered via facsimile. Each such notice must be received by the Administrative Agent not later than (i) 12:00 noon three Business Days prior to the requested date of any Borrowing of, conversion to or continuation of Eurodollar Rate Loans or of any conversion of Eurodollar Rate Loans to Base Rate Loans, and (ii) 11:00 a.m. on the requested date of any Borrowing of Base Rate Loans. Each Borrowing of, conversion or continuation of Loans shall be in a principal amount of $2,000,000 or a whole multiple of $500,000 in excess thereof. Each Loan Notice shall specify (iii) whether the Borrower is requesting a Borrowing, a conversion of Loans from one Type to the other, or a continuation of Eurodollar Rate Loans, (iv) the requested date of the Borrowing, conversion or continuation, as the case may be (which shall be a Business Day), (v) the principal amount of Loans to be borrowed, converted or continued, (vi) the Type of Loans to be borrowed or to which existing Loans are to be converted and (vii) if applicable, the duration of the Interest Period with respect thereto. If the Borrower fails to specify a Type of Loan in a Loan Notice or if the Borrower fails to give a timely notice requesting a conversion or continuation, then the applicable Loans shall be made as, or converted to, Base Rate Loans. Any such automatic conversion to Base Rate Loans shall be effective as of the last day of the Interest Period then in effect with respect to the applicable Eurodollar Rate Loans. If the Borrower requests a Borrowing of, conversion to, or continuation of Eurodollar Rate Loans in any such Loan Notice, but fails to specify an Interest Period, it will be deemed to have specified an Interest Period of one month.

(b) Following receipt of a Loan Notice, the Administrative Agent shall promptly notify, each Lender of the amount of its Pro Rata Share of the applicable Borrowing, and if no timely notice of a conversion or continuation is provided by the Borrower, the Administrative Agent shall notify each applicable Lender of the details of any automatic conversion to Base Rate Loans described in the preceding Section. Each Lender shall make the amount of the applicable Loan available to the Administrative Agent in immediately available funds at the Administrative Agent’s Office not later than 2:00 p.m. on the Business Day specified in the applicable Loan Notice. Upon satisfaction of the applicable conditions set forth in Section 4.02 (and, if such Borrowing is the initial Credit Extension, Sections 4.01 and 4.02 ), the Administrative Agent shall make all funds so received available to the Borrower in like funds as received by the Administrative Agent either by (i) crediting the account of the Borrower on the books of JPM with the amount of such funds or (ii) wire transfer of such funds, in each case in accordance with instructions provided to (and reasonably acceptable to) the Administrative Agent by the Borrower; provided, however, that if, on the date the Loan Notice with respect a Borrowing is given by the Borrower, there are L/C Borrowings outstanding, then the proceeds of such Borrowing shall be applied, first, to the payment in full of any such L/C Borrowings and second, to the Borrower as provided above.

(c) Except as otherwise provided herein, a Eurodollar Rate Loan may be continued or converted only on the last day of an Interest Period for such Eurodollar Rate Loan. During the existence of a Default, no Loans may be requested as, converted to or continued as Eurodollar Rate Loans without the consent of the Required Lenders.

(d) The Administrative Agent shall promptly notify the Borrower and the Lenders of the interest rate applicable to any Interest Period for Eurodollar Rate Loans upon determination of such interest rate. The determination of the Adjusted Eurodollar Rate by the Administrative Agent shall be conclusive in the absence of manifest error. At any time that Base Rate Loans are outstanding, the Administrative Agent shall notify the Borrower and the Lenders of any change in JPM’s prime rate used in determining the Base Rate promptly following the public announcement of such change.

(e) After giving effect to all Borrowings, all conversions of Loans from one Type to the other, and all continuations of Loans as the same Type, there shall not be more than ten Interest Periods in effect with respect to Loans.

 

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2.03 Letters of Credit .

(a) The Letter of Credit Commitment .

(i) Subject to the terms and conditions set forth herein, (A) each L/C Issuer agrees, in reliance upon the agreements of the other Lenders set forth in this Section 2.03 , from time to time on any Business Day during the period from the Closing Date until the Letter of Credit Expiration Date, to issue Letters of Credit for the account of the Borrower or any of its Subsidiaries, and to amend or extend Letters of Credit previously issued by it, in accordance with Section 2.03(b) below; and (B) the Lenders severally agree to participate in Letters of Credit issued for the account of the Borrower or any of its Subsidiaries; provided that (i) no L/C Issuer shall be obligated to make any L/C Credit Extension that would (i) result in the Outstanding Amount of the L/C Obligations with respect to Letters of Credit issued by it to exceed $20,000,000 or (ii) result in the Outstanding Amount of the L/C Obligations with respect to Letters of Credit issued by the L/C Issuers to exceed the Letter of Credit Sublimit; and provided further that no L/C Issuer shall be obligated to make any L/C Credit Extension with respect to any Letter of Credit, and no Lender shall be obligated to participate in any Letter of Credit if as of the date of such L/C Credit Extension (x) the Total Outstandings would exceed the Aggregate Commitment and (y) the aggregate Outstanding Amount of the Loans of any Lender, plus such Lender’s Pro Rata Share of the Outstanding Amount of all L/C Obligations, plus such Lender’s Pro Rata Share of the Outstanding Amount of all Swing Line Loans, would exceed such Lender’s Commitment. Within the foregoing limits, and subject to the terms and conditions hereof, the Borrower’s ability to obtain Letters of Credit shall be fully revolving, and accordingly the Borrower may, during the foregoing period, obtain Letters of Credit to replace Letters of Credit that have expired or that have been drawn upon and reimbursed.

(ii) No L/C Issuer shall be under any obligation to issue any Letter of Credit and, in the case of clauses (B) and (C) below no L/C Issuer shall issue any Letter of Credit, if:

(A) any order, judgment or decree of any Governmental Authority or arbitrator shall by its terms purport to enjoin or restrain such L/C Issuer from issuing such Letter of Credit, or any Law applicable to such L/C Issuer or any request or directive (whether or not having the force of law) from any Governmental Authority with jurisdiction over such L/C Issuer shall prohibit, or request that such L/C Issuer refrain from, the issuance of Letters of Credit generally or such Letter of Credit in particular or shall impose upon such L/C Issuer with respect to such Letter of Credit any restriction, reserve or capital requirement (for which such L/C Issuer is not otherwise compensated hereunder) not in effect on the Closing Date, or shall impose upon such L/C Issuer any unreimbursed loss, cost or expense which was not applicable on the Closing Date and which such L/C Issuer in good faith deems material to it;

(B) subject to Section 2.03(b)(iii) , the expiry date of such requested Letter of Credit would occur more than twelve months after the date of issuance or last renewal, unless the Required Lenders have approved such expiry date;

(C) the expiry date of such requested Letter of Credit would occur after the Letter of Credit Expiration Date, unless all the Lenders have approved such expiry date;

(D) the issuance of such Letter of Credit would violate one or more policies of such L/C Issuer; or

(E) such Letter of Credit is (1) in an initial amount less than $100,000, (2) is to be denominated in a currency other than Dollars, or (3) is to be issued for a purpose other than to support surety bonds (including appeal bonds), worker’s compensation requirements and other general corporate purposes.

(iii) No L/C Issuer shall amend any Letter of Credit if such L/C Issuer would have no obligation at such time to issue such Letter of Credit in its amended form under any of Sections   2.03(a)(ii)(B) , (C) or (E)(2) or (3) .

(iv) No L/C Issuer shall be under any obligation to amend any Letter of Credit if the beneficiary of such Letter of Credit does not accept the proposed amendment to such Letter of Credit.

 

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(b) Procedures for Issuance and Amendment of Letters of Credit; Auto-Renewal Letters of Credit .

(i) Each Letter of Credit shall be issued or amended, as the case may be, upon the request of the Borrower delivered to an L/C Issuer (with a copy to the Administrative Agent) in the form of a Letter of Credit Application, appropriately completed and signed by or on behalf of the Borrower. Such Letter of Credit Application must be received by such L/C Issuer and the Administrative Agent not later than 12:00 noon at least two Business Days (or such later date and time as such L/C Issuer may agree in a particular instance in its sole discretion) prior to the proposed issuance date or date of amendment, as the case may be. In the case of a request for an initial issuance of a Letter of Credit, such Letter of Credit Application shall specify in form and detail satisfactory to such L/C Issuer: (A) the proposed issuance date of the requested Letter of Credit (which shall be a Business Day); (B) the amount thereof; (C) the expiry date thereof; (D) the name and address of the beneficiary thereof; (E) the documents to be presented by such beneficiary in case of any drawing thereunder; (F) the full text of any certificate to be presented by such beneficiary in case of any drawing thereunder; and (G) such other matters as such L/C Issuer may require. In the case of a request for an amendment of any outstanding Letter of Credit, such Letter of Credit Application shall specify in form and detail satisfactory to the an L/C Issuer (A) the Letter of Credit to be amended; (B) the proposed date of amendment thereof (which shall be a Business Day); (C) the nature of the proposed amendment; and (D) such other matters as such L/C Issuer may require.

(ii) Promptly after receipt of any Letter of Credit Application, the applicable L/C Issuer will confirm with the Administrative Agent (by telephone or in writing) that the Administrative Agent has received a copy of such Letter of Credit Application from the Borrower and, if not, the Borrower will provide the Administrative Agent with a copy thereof upon the Administrative Agent’s request therefor. Unless such L/C Issuer has received written notice from any Lender, the Administrative Agent or the Borrower, at least one Business Day prior to the requested date of issuance or amendment of the applicable Letter of Credit, that one or more applicable conditions contained in Article IV shall not be satisfied, then, upon receipt by such L/C Issuer of confirmation from the Administrative Agent that the requested issuance or amendment is permitted in accordance with the terms hereof, subject to the terms and conditions hereof, such L/C Issuer shall, on the requested date, issue a Letter of Credit for the account of the Borrower or enter into the applicable amendment, as the case may be, in each case in accordance with such L/C Issuer’s usual and customary business practices. Immediately upon the issuance of each Letter of Credit, each Lender shall be deemed to, and hereby irrevocably and unconditionally agrees to, purchase from such L/C Issuer a risk participation in such Letter of Credit in an amount equal to the product of such Lender’s Pro Rata Share times the amount of such Letter of Credit.

(iii) If the Borrower so requests in any applicable Letter of Credit Application, the applicable L/C Issuer may, in its sole and absolute discretion, agree to issue a Letter of Credit that has automatic extension provisions (each, an “ Auto-Extension Letter of Credit ”); provided that any such Auto-Extension Letter of Credit must permit such L/C Issuer to prevent any such extension at least once in each twelve-month period (commencing with the date of issuance of such Letter of Credit) by giving prior notice to the beneficiary thereof not later than a day (the “ Non-Extension Notice Date ”) in each such twelve-month period to be agreed upon at the time such Letter of Credit is issued. Unless otherwise directed by such L/C Issuer, the Borrower shall not be required to make a specific request to such L/C Issuer for any such extension. Once an Auto-Extension Letter of Credit has been issued, the Lenders shall be deemed to have authorized (but may not require) the applicable L/C Issuer to permit the extension of such Letter of Credit at any time to an expiry date not later than the Letter of Credit Expiration Date; provided, however, that such L/C Issuer shall not permit any such extension if (A) such L/C Issuer has determined that

 

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it would not be permitted, or would have no obligation, at such time to issue such Letter of Credit in its revised form (as extended) under the terms hereof (by reason of the provisions of Section   2.03(a) or otherwise), or (B) it has received notice (which may be by telephone or in writing) on or before the day that is seven Business Days before the Non-Extension Notice Date (1) from the Administrative Agent that the Required Lenders have elected not to permit such extension or (2) from the Administrative Agent, any Lender or the Borrower that one or more of the applicable conditions specified in Section 4.02 is not then satisfied and in each such case directing such L/C Issuer not to permit such extension.

(iv) Promptly after its delivery of any Letter of Credit or any amendment to a Letter of Credit to an advising bank with respect thereto or to the beneficiary thereof, the applicable L/C Issuer will also deliver to the Borrower and the Administrative Agent a true and complete copy of such Letter of Credit or amendment or a report containing information with respect thereto including the face amount of such Letter of Credit, the date of issuance or amendment and such other information as may be required by the Administrative Agent. The Administrative Agent shall give the Lenders notice of the issuance of any Letter of Credit and any amendment thereto.

(c) Drawings and Reimbursements; Funding of Participations .

(i) Upon receipt from the beneficiary of any Letter of Credit of any notice of a drawing under such Letter of Credit, the applicable L/C Issuer shall notify the Borrower and the Administrative Agent thereof. The Borrower shall reimburse such L/C Issuer through the Administrative Agent by paying an amount equal to the amount of any drawing under a Letter of Credit not later than (A) if the Borrower shall have received notice of such drawing prior to 10:00 a.m. on any Business Day, then 2:00 p.m. on such Business Day or (B) otherwise, 11:00 a.m. on the Business Day immediately following the day that the Borrower receives such notice (each such date for reimbursement, a “ Reimbursement Date ”). If the Borrower fails to so reimburse such L/C Issuer by such time, the Administrative Agent shall promptly notify each Lender of the Reimbursement Date, the amount of the unreimbursed drawing (the “ Unreimbursed Amount ”), and the amount of such Lender’s Pro Rata Share thereof. In such event, the Borrower shall be deemed to have requested a Borrowing of Base Rate Loans to be disbursed on the Reimbursement Date in an amount equal to the Unreimbursed Amount, without regard to the minimum and multiples specified in Section   2.02 for the principal amount of Base Rate Loans, but subject to the amount of the unutilized portion of the Aggregate Commitment and the conditions set forth in Section 4.02 (other than the delivery of a Loan Notice). Any notice given by an L/C Issuer or the Administrative Agent pursuant to this Section   2.03(c)(i) may be given by telephone if immediately confirmed in writing; provided that the lack of such an immediate confirmation shall not affect the conclusiveness or binding effect of such notice.

(ii) Each Lender (including the Lender acting as the applicable L/C Issuer) shall upon any notice pursuant to Section 2.03(c)(i) make funds available to the Administrative Agent for the account of such L/C Issuer at the Administrative Agent’s Office in an amount equal to its Pro Rata Share of the Unreimbursed Amount not later than 1:00 p.m. on the Business Day specified in such notice by the Administrative Agent, whereupon, subject to the provisions of Section 2.03(c)(iii) , each Lender that so makes funds available shall be deemed to have made a Base Rate Loan to the Borrower in such amount. The Administrative Agent shall remit the funds so received to such L/C Issuer.

(iii) With respect to any Unreimbursed Amount that is not fully refinanced by a Borrowing of Base Rate Loans because the conditions set forth in Section 4.02 cannot be satisfied or for any other reason, the Borrower shall be deemed to have incurred from the applicable L/C Issuer an L/C Borrowing in the amount of the Unreimbursed Amount that is not so refinanced, which L/C Borrowing shall be due and payable on demand (together with interest) and shall bear interest at the Default Rate. In such event, each Lender’s payment to the Administrative Agent for the account of such L/C Issuer pursuant to Section   2.03(c)(ii) shall be deemed payment in respect of its participation in such L/C Borrowing and shall constitute an L/C Advance from such Lender in satisfaction of its participation obligation under this Section   2.03 .

 

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(iv) Until each Lender funds its Loan or L/C Advance pursuant to this Section   2.03(c) to reimburse the applicable L/C Issuer for any amount drawn under any Letter of Credit, interest in respect of such Lender’s Pro Rata Share of such amount shall be solely for the account of such L/C Issuer.

(v) Each Lender’s obligation to make Loans or L/C Advances to reimburse an L/C Issuer for amounts drawn under Letters of Credit, as contemplated by this Section 2.03(c) , shall be absolute and unconditional and shall not be affected by any circumstance, including (A) any set-off, counterclaim, recoupment, defense or other right which such Lender may have against such L/C Issuer, the Borrower or any other Person for any reason whatsoever; (B) the occurrence or continuance of a Default; (C) any lack of validity or enforceability of such Letter of Credit, this Agreement, or any other agreement or instrument relating thereto; (D) the existence of any claim, counterclaim, set-off, defense or other right that such Lender may have at any time against any beneficiary or any transferee of such Letter of Credit (or any Person for whom any such beneficiary or any such transferee may be acting), such L/C Issuer or any other Person, whether in connection with this Agreement, the transactions contemplated hereby or by such Letter of Credit or any agreement or instrument relating thereto, or any unrelated transaction; (E) any draft, demand, certificate or other document presented under such Letter of Credit proving to be forged, fraudulent, invalid or insufficient in any respect or any statement therein being untrue or inaccurate in any respect; or any loss or delay in the transmission or otherwise of any document required in order to make a drawing under such Letter of Credit; (F) any payment by such L/C Issuer under such Letter of Credit against presentation of a draft or certificate that does not comply with the terms of such Letter of Credit; or any payment made by such L/C Issuer under such Letter of Credit to any Person purporting to be a trustee in bankruptcy, debtor-in-possession, assignee for the benefit of creditors, liquidator, receiver or other representative of or successor to any beneficiary or any transferee of such Letter of Credit, including any arising in connection with any proceeding under any Debtor Relief Law; or (G) any other occurrence, event or condition, whether or not similar to any of the foregoing; provided , however , that each Lender’s obligation to make Loans pursuant to this Section 2.03(c) is subject to the conditions set forth in Section   4.02 (other than delivery by the Borrower of a Loan Notice). No such making of an L/C Advance shall relieve or otherwise impair the obligation of the Borrower to reimburse an L/C Issuer for the amount of any payment made by such L/C Issuer under any Letter of Credit, together with interest as provided herein.

(vi) If any Lender fails to make available to the Administrative Agent for the account of any L/C Issuer any amount required to be paid by such Lender pursuant to the foregoing provisions of this Section 2.03(c) by the time specified in Section 2.03(c)(ii) , such L/C Issuer shall be entitled to recover from such Lender (acting through the Administrative Agent), on demand, such amount with interest thereon for the period from the date such payment is required to the date on which such payment is immediately available to such L/C Issuer at a rate per annum equal to the greater of the Federal Funds Effective Rate and a rate determined by such L/C Issuer in accordance with banking industry rules on interbank compensation, plus any administrative, processing or similar fees customarily charged by such L/C Issuer in connection with the foregoing. If such Lender pays such amount (with interest and fees as aforesaid), the amount so paid shall constitute such Lender’s Loan included in the relevant Borrowing or L/C Advance in respect of the relevant L/C Borrowing, as the case may be. A certificate of any L/C Issuer submitted to any Lender (through the Administrative Agent) with respect to any amounts owing under this clause   (vi) shall be conclusive absent manifest error.

(d) Repayment of Participations .

(i) At any time after an L/C Issuer has made a payment under any Letter of Credit and has received from any Lender such Lender’s L/C Advance in respect of such payment in

 

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accordance with Section 2.03(c) , if the Administrative Agent receives for the account of such L/C Issuer any payment in respect of the related Unreimbursed Amount or interest thereon (whether directly from the Borrower or otherwise, including proceeds of Cash Collateral applied thereto by the Administrative Agent), the Administrative Agent will distribute to such Lender its Pro Rata Share thereof (appropriately adjusted, in the case of interest payments, to reflect the period of time during which such Lender’s L/C Advance was outstanding) in the same funds as those received by the Administrative Agent.

(ii) If any payment received by the Administrative Agent for the account of an L/C Issuer pursuant to Section 2.03(c)(i) is required to be returned under any of the circumstances described in Section   10.06 (including pursuant to any settlement entered into by such L/C Issuer in its discretion), each Lender shall pay to the Administrative Agent for the account of such L/C Issuer its Pro Rata Share thereof on demand of the Administrative Agent, plus interest thereon from the date of such demand to the date such amount is paid by such Lender, at a rate per annum equal to the Federal Funds Effective Rate from time to time in effect.

(e) Obligations Absolute . The obligation of the Borrower to reimburse each L/C Issuer for each drawing under each Letter of Credit and to repay each L/C Borrowing shall be absolute, unconditional and irrevocable, and shall be paid strictly in accordance with the terms of this Agreement under all circumstances, including the following:

(i) any lack of validity or enforceability of such Letter of Credit, this Agreement, or any other agreement or instrument relating thereto;

(ii) the existence of any claim, counterclaim, set-off, defense or other right that the Borrower may have at any time against any beneficiary or any transferee of such Letter of Credit (or any Person for whom any such beneficiary or any such transferee may be acting), such L/C Issuer or any other Person, whether in connection with this Agreement, the transactions contemplated hereby or by such Letter of Credit or any agreement or instrument relating thereto, or any unrelated transaction;

(iii) any draft, demand, certificate or other document presented under such Letter of Credit proving to be forged, fraudulent, invalid or insufficient in any respect or any statement therein being untrue or inaccurate in any respect; or any loss or delay in the transmission or otherwise of any document required in order to make a drawing under such Letter of Credit;

(iv) any payment by such L/C Issuer under such Letter of Credit against presentation of a draft or certificate that does not comply with the terms of such Letter of Credit; or any payment made by such L/C Issuer under such Letter of Credit to any Person purporting to be a trustee in bankruptcy, debtor-in-possession, assignee for the benefit of creditors, liquidator, receiver or other representative of or successor to any beneficiary or any transferee of such Letter of Credit, including any arising in connection with any proceeding under any Debtor Relief Law; or

(v) any other circumstance or happening whatsoever, whether or not similar to any of the foregoing, including any other circumstance that might otherwise constitute a defense available to, or a discharge of, the Borrower.

The Borrower shall promptly examine a copy of each Letter of Credit and each amendment thereto that is delivered to it and, in the event of any claim of noncompliance with the Borrower’s instructions or other irregularity, the Borrower will immediately notify the applicable L/C Issuer. The Borrower shall be conclusively deemed to have waived any such claim against such L/C Issuer and its correspondents unless such notice is given as aforesaid.

(f) Role of L/C Issuers . Each Lender and the Borrower agree that, in paying any drawing under a Letter of Credit, the applicable L/C Issuer shall not have any responsibility to obtain any document (other

 

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than any sight draft, certificates and documents expressly required by the Letter of Credit) or to ascertain or inquire as to the validity or accuracy of any such document or the authority of the Person executing or delivering any such document. None of any L/C Issuer, any L/C Issuer Related Person, nor any of the respective correspondents, participants or assignees of any L/C Issuer shall be liable to any Lender for (i) any action taken or omitted in connection herewith at the request or with the approval of the Lenders or the Required Lenders, as applicable; (ii) any action taken or omitted in the absence of gross negligence or willful misconduct; or (iii) the due execution, effectiveness, validity or enforceability of any document or instrument related to any Letter of Credit or Letter of Credit Application. The Borrower hereby assumes all risks of the acts or omissions of any beneficiary or transferee with respect to its use of any Letter of Credit; provided , however , that this assumption is not intended to, and shall not, preclude the Borrower’s pursuing such rights and remedies as it may have against the beneficiary or transferee at law or under any other agreement. None of any L/C Issuer, any L/C Issuer Related Person, any Lender, nor any of the respective correspondents, participants or assignees of any L/C Issuer, shall be liable or responsible to the Borrower for any of the matters described in clauses (i) through (v) of Section 2.03(e) ; provided, however, that anything in such clauses to the contrary notwithstanding, the Borrower may have a claim against an L/C Issuer, and such L/C Issuer may be liable to the Borrower, to the extent, but only to the extent, of any direct, as opposed to special, indirect, consequential, punitive or exemplary, damages suffered by the Borrower which damages have been determined by a final non-appealable judgment of a court of competent jurisdiction to have been caused by such L/C Issuer’s willful misconduct or gross negligence. In furtherance and not in limitation of the foregoing, each L/C Issuer may accept documents that appear on their face to be in order, without responsibility for further investigation, regardless of any notice or information to the contrary, and such L/C Issuer shall not be responsible for the validity or sufficiency of any instrument transferring or assigning or purporting to transfer or assign a Letter of Credit or the rights or benefits thereunder or proceeds thereof, in whole or in part, which may prove to be invalid or ineffective for any reason.

(g) Applicability of ISP . Unless otherwise expressly agreed by the applicable L/C Issuer and the Borrower when a Letter of Credit is issued, the rules of the “International Standby Practices 1998” published by the Institute of International Banking Law & Practice (or such later version thereof as may be in effect at the time of issuance) (the “ ISP ”) shall apply to each standby Letter of Credit.

(h) Letter of Credit Fees . The Borrower shall pay to the Administrative Agent for the account of each Lender in accordance with its Pro Rata Share a Letter of Credit fee for each Letter of Credit equal to the Applicable Rate times the daily maximum amount available to be drawn under such Letter of Credit (whether or not such maximum amount is then in effect under such Letter of Credit). Such Letter of Credit fees shall be computed on a quarterly basis in arrears. Such Letter of Credit fees shall be due and payable quarterly in arrears on the first Business Day of each January, April, July and October, commencing with the first such date to occur after the issuance of such Letter of Credit, on the Letter of Credit Expiration Date and thereafter on demand. If there is any change in the Applicable Rate during any quarter, the daily maximum amount of each Letter of Credit shall be computed and multiplied by the Applicable Rate separately for each period during such quarter that such Applicable Rate was in effect.

(i) Fronting Fee and Documentary and Processing Charges Payable to L/C Issuers . The Borrower shall pay directly to each L/C Issuer for its own account (A) a fronting fee with respect to each Letter of Credit issued by such L/C Issuer equal to 0.125% per annum times the daily maximum amount available to be drawn under such Letter of Credit (whether or not such maximum amount is then in effect under such Letter of Credit); provided that in no event shall such fee be less than $500 during any quarter, and (B) customary fees for the issuance, presentation, amendment and other processing of Letters of Credit, and other standard costs and charges of such L/C Issuer relating to Letters of Credit as from time to time in effect. The fees pursuant to clause (A) shall be computed on a quarterly basis in arrears and shall be due and payable quarterly in arrears on the first Business Day of each January, April, July and October, commencing with the first such date to occur after the issuance of such Letter of Credit, on the Letter of Credit Expiration Date and thereafter on demand. The fees pursuant to clause (B) are due and payable on demand and are nonrefundable.

(j) Conflict with Letter of Credit Application . In the event of any conflict between the terms hereof and the terms of any Letter of Credit Application, the terms hereof shall control.

 

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2.04 Swing Line Loans .

(a) The Swing Line . Subject to the terms and conditions set forth herein, each Swing Line Lender agrees, in reliance upon the agreements of the other Lenders set forth in this Section 2.04 , to make loans (each such loan, a “ Swing Line Loan ”) to the Borrower from time to time on any Business Day during the Availability Period in an aggregate amount not to exceed at any time outstanding the amount of the Swing Line Sublimit; provided , however, that after giving effect to any Swing Line Loan, (i) the Outstanding Amount of all Swing Line Loans made by each Swing Line Lender shall not exceed $20,000,000, (ii) the Outstanding Amount of all outstanding Swing Line Loans shall not exceed the Swing Line Sublimit, (iii) the Total Outstandings shall not exceed the Aggregate Commitment, and (iv) the aggregate Outstanding Amount of the Loans of any Lender, plus such Lender’s Pro Rata Share of the Outstanding Amount of all L/C Obligations, plus such Lender’s Pro Rata Share of the Outstanding Amount of all Swing Line Loans shall not exceed such Lender’s Commitment, and provided , further , that the Borrower shall not use the proceeds of any Swing Line Loan to refinance any outstanding Swing Line Loan. Within the foregoing limits, and subject to the other terms and conditions hereof, the Borrower may borrow under this Section 2.04 , prepay under Section 2.05 , and reborrow under this Section 2.04 . Each Swing Line Loan will be a Base Rate Loan. Immediately upon the making of a Swing Line Loan, each Lender shall be deemed to, and hereby irrevocably and unconditionally agrees to, purchase from the applicable Swing Line Lender a risk participation in such Swing Line Loan in an amount equal to the product of such Lender’s Pro Rata Share times the amount of such Swing Line Loan.

(b) Borrowing Procedures . Each Swing Line Borrowing shall be made upon the Borrower’s irrevocable notice to each applicable Swing Line Lender and the Administrative Agent, which may be given by telephone. Each such notice must be received by each such Swing Line Lender and the Administrative Agent not later than 2:00 p.m. on the requested borrowing date, and shall specify (i) the Swing Line Lender or the Swing Line Lenders that are requested to provide the requested Swing Line Borrowing, (ii) the amount to be borrowed from each such Swing Line Lender, which, in each case, shall be a minimum of $100,000 and (iii) the requested borrowing date, which shall be a Business Day. Each such telephonic notice must be confirmed promptly by delivery to each such Swing Line Lender and the Administrative Agent of a written Swing Line Loan Notice, appropriately completed and signed by or on behalf of the Borrower. Promptly after receipt by each such Swing Line Lender of any telephonic Swing Line Loan Notice, each such Swing Line Lender will confirm with the Administrative Agent (by telephone or in writing) that the Administrative Agent has also received such Swing Line Loan Notice and, if not, each such Swing Line Lender will notify the Administrative Agent (by telephone or in writing) of the contents thereof. Unless a Swing Line Lender has received notice (by telephone or in writing) from the Administrative Agent (including at the request of any Lender) prior to 3:00 p.m. on the date of the proposed Swing Line Borrowing (A) directing such Swing Line Lender not to make such Swing Line Loan as a result of the limitations set forth in the proviso to the first sentence of Section 2.04(a) , or (B) that one or more of the applicable conditions specified in Section 4.02 is not then satisfied, then, subject to the terms and conditions hereof, such Swing Line Lender will, not later than 4:00 p.m. on the borrowing date specified in such Swing Line Loan Notice, make the amount of its Swing Line Loan available to the Borrower.

(c) Refinancing of Swing Line Loans .

(i) Each Swing Line Lender at any time in its sole and absolute discretion may request, on behalf of the Borrower (which hereby irrevocably authorizes the Swing Line Lender to so request on its behalf), that each Lender make a Base Rate Loan in an amount equal to such Lender’s Pro Rata Share of the amount of Swing Line Loans made by such Swing Line Lender then outstanding. Such request shall be made in writing (which written request shall be deemed to be a Loan Notice for a Loan for purposes hereof) and in accordance with the requirements of Section 2.02 , without regard to the minimum and multiples specified therein for the principal amount of Base Rate Loans, but subject to the unutilized portion of the Aggregate Commitment and the conditions set forth in Section 4.02 . Such Swing Line Lender shall furnish the Borrower with a copy of the applicable Loan Notice promptly after delivering such notice to the Administrative Agent. Each Lender shall make an amount equal to its Pro Rata Share of the amount specified in such Loan Notice available to the Administrative Agent in immediately available funds for the account of such Swing Line Lender at the Administrative Agent’s Office for Dollar-denominated payments not later than 1:00 p.m. on the day specified in such Loan Notice, whereupon, subject to Section   2.04(c)(ii) , each Lender that so makes funds available shall be deemed to have made a Base Rate Loan to the Borrower in such amount. The Administrative Agent shall remit the funds so received to such Swing Line Lender.

 

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(ii) If for any reason any Swing Line Loan cannot be refinanced by such a Borrowing in accordance with Section 2.04(c)(i) , the request for Base Rate Loans submitted by a Swing Line Lender as set forth herein shall be deemed to be a request by such Swing Line Lender that each of the Lenders fund its risk participation in the relevant Swing Line Loan and each Lender’s payment to the Administrative Agent for the account of such Swing Line Lender pursuant to Section 2.04(c)(i) shall be deemed payment in respect of such participation.

(iii) If any Lender fails to make available to the Administrative Agent for the account of a Swing Line Lender any amount required to be paid by such Lender pursuant to the foregoing provisions of this Section 2.04(c) by the time specified in Section 2.04(c)(i) , such Swing Line Lender shall be entitled to recover from such Lender (acting through the Administrative Agent), on demand, such amount with interest thereon for the period from the date such payment is required to the date on which such payment is immediately available to such Swing Line Lender at a rate per annum equal to the greater of the Federal Funds Effective Rate and a rate determined by such Swing Line Lender in accordance with banking industry rules on interbank compensation. A certificate of a Swing Line Lender submitted to any Lender (through the Administrative Agent) with respect to any amounts owing under this clause (iii) shall be conclusive absent manifest error.

(iv) Each Lender’s obligation to make Loans or to purchase and fund risk participations in Swing Line Loans pursuant to this Section 2.04(c) shall be absolute and unconditional and shall not be affected by any circumstance, including (A) any setoff, counterclaim, recoupment, defense or other right which such Lender may have against any Swing Line Lender, the Borrower or any other Person for any reason whatsoever, (B) the occurrence or continuance of a Default, or (C) any other occurrence, event or condition, whether or not similar to any of the foregoing; provided , however , that each Lender’s obligation to make Loans pursuant to this Section 2.04(c) is subject to the conditions set forth in Section   4.02 . No such funding of risk participations shall relieve or otherwise impair the obligation of the Borrower to repay Swing Line Loans, together with interest as provided herein.

(d) Repayment of Participations .

(i) At any time after any Lender has purchased and funded a risk participation in a Swing Line Loan, if the applicable Swing Line Lender receives any payment on account of such Swing Line Loan, such Swing Line Lender will distribute to such Lender its Pro Rata Share thereof in the same funds as those received by such Swing Line Lender.

(ii) If any payment received by a Swing Line Lender in respect of principal or interest on any Swing Line Loan is required to be returned by such Swing Line Lender under any of the circumstances described in Section 10.06 (including pursuant to any settlement entered into by such Swing Line Lender in its discretion), each Lender shall pay to such Swing Line Lender its Pro Rata Share thereof on demand of the Administrative Agent, plus interest thereon from the date of such demand to the date such amount is returned, at a rate per annum equal to the Federal Funds Effective Rate. The Administrative Agent will make such demand upon the request of a Swing Line Lender. The obligations of the Lenders under this clause shall survive the payment in full of the Obligations and the termination of this Agreement.

(e) Interest for Account of Swing Line Lender . Each Swing Line Lender shall be responsible for invoicing the Borrower for interest on the Swing Line Loans made by such Swing Line Lender. Until each Lender funds its Loan or risk participation pursuant to this Section 2.04 to refinance such Lender’s Pro Rata Share of any Swing Line Loan, interest in respect of such Pro Rata Share shall be solely for the account of the applicable Swing Line Lender.

(f) Payments Directly to Swing Line Lender . The Borrower shall make all payments of principal and interest in respect of Swing Line Loans made by each Swing Line Lender directly to such Swing Line Lender.

 

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2.05 Prepayments .

(a) The Borrower may, upon notice to the Administrative Agent, at any time or from time to time voluntarily prepay Loans in whole or in part without premium or penalty; provided that (i) such notice must be received by the Administrative Agent not later than 12:00 noon (A) three Business Days prior to any date of prepayment of Eurodollar Rate Loans and (B) on the date of prepayment of Base Rate Loans; (ii) any prepayment of Eurodollar Rate Loans shall be in a principal amount of $500,000 or a whole multiple of $100,000 in excess thereof, and (iii) any prepayment of Base Rate Loans shall be in a principal amount of $500,000 or a whole multiple of $100,000 in excess thereof or, in each case, if less, the entire principal amount thereof then outstanding. Each such notice shall specify (x) the date and amount of such prepayment and (y) the Type(s) of Loans to be prepaid. The Administrative Agent will promptly notify each Lender, as the case may be, of its receipt of each such notice, and of the amount of such Lender’s Pro Rata Share of such prepayment. If such notice is given by the Borrower, the Borrower shall make such prepayment and the payment amount specified in such notice shall be due and payable on the date specified therein; provided that, a notice of prepayment of all outstanding Loans may state that such notice is conditioned upon the effectiveness of other credit facilities or any incurrence or issuance of debt or equity or the occurrence of any other transaction, in which case such notice may be revoked, subject to Section   3.05 , by the Borrower (by notice to the Administrative Agent on or prior to the specified effective date) if such condition is not satisfied. Any prepayment of Eurodollar Rate Loans shall be accompanied by all accrued interest thereon, together with any additional amounts required pursuant to Section 3.05 . Each such prepayment shall be applied to the Loans in accordance with the Lenders’ Pro Rata Shares.

(b) The Borrower may, upon notice to the applicable Swing Line Lender (with a copy to the Administrative Agent), at any time or from time to time, voluntarily prepay Swing Line Loans made by such Swing Line Lender in whole or in part without premium or penalty; provided that (i) such notice must be received by such Swing Line Lender and the Administrative Agent not later than 2:00 p.m. on the date of the prepayment, and (ii) any such prepayment shall be in a minimum principal amount of $100,000. Each such notice shall specify the date and amount of such prepayment. If such notice is given by the Borrower, the Borrower shall make such prepayment and the payment amount specified in such notice shall be due and payable on the date specified therein.

(c) If for any reason the Total Outstandings at any time exceed the Aggregate Commitment then in effect, the Borrower shall immediately prepay Loans and/or Cash Collateralize the L/C Obligations in an aggregate amount equal to such excess; provided, however, that the Borrower shall not be required to Cash Collateralize the L/C Obligations pursuant to this Section 2.05(c) unless after the prepayment in full of the Loans, the Total Outstandings exceed the Aggregate Commitment then in effect.

2.06 Termination or Reduction of Commitments . The Borrower may, upon notice to the Administrative Agent, terminate the Aggregate Commitment, or from time to time permanently reduce the Aggregate Commitments; provided that (i) any such notice shall be received by the Administrative Agent not later than 12:00 noon three Business Days prior to the date of termination or reduction, (ii) any such partial reduction shall be in an aggregate amount of $10,000,000 or any whole multiple of $1,000,000 in excess thereof, (iii) the Borrower shall not terminate or reduce the Aggregate Commitment if, after giving effect thereto and to any concurrent prepayments hereunder, the Total Outstandings would exceed the Aggregate Commitment, and (iv) if, after giving effect to any reduction of the Aggregate Commitment, the Letter of Credit Sublimit or the Swing Line Sublimit exceeds the amount of the Aggregate Commitment, such Letter of Credit Sublimit or such Swing Line Sublimit shall be automatically reduced by the amount of such excess; provided further that, a notice of termination of the Aggregate Commitment may state that such notice is conditioned upon the effectiveness of other credit facilities or any incurrence or issuance of debt or equity or the occurrence of any other transaction, in which case such notice may be revoked, subject to Section 3.05 , by the Borrower (by notice to the Administrative Agent on or prior to the specified effective date) if such condition is not satisfied. The Administrative Agent will promptly notify the Lenders of any such notice of termination or reduction of the Aggregate Commitment. Any reduction of the Aggregate Commitment shall be applied to the Commitment of each Lender according to its Pro Rata Share. All commitment fees accrued until the effective date of any termination of the Aggregate Commitment shall be paid on the effective date of such termination.

 

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2.07 Repayment of Loans .

(a) The Borrower shall repay to the Lenders on the Maturity Date the aggregate principal amount of Loans outstanding on such date.

(b) The Borrower shall repay each Swing Line Loan on the earlier to occur of (i) the date ten Business Days after such Swing Line Loan is made and (ii) the Maturity Date; provided that on each date that a Borrowing (other than a Swing Line Borrowing) is made, the Borrower shall repay all Swing Line Loans then outstanding and the proceeds of any such Borrowing shall be applied by the Administrative Agent to prepay all Swing Line Loans then outstanding on a pro rata basis.

2.08 Interest .

(a) Subject to the provisions of Section 2.08(b) below, (i) each Eurodollar Rate Loan shall bear interest on the outstanding principal amount thereof for each Interest Period at a rate per annum equal to the Adjusted Eurodollar Rate for such Interest Period plus the Applicable Rate; (ii) each Base Rate Loan (other than Swing Line Loans) shall bear interest on the outstanding principal amount thereof from the applicable borrowing date at a rate per annum equal to the Base Rate plus the Applicable Rate and (iii) each Swing Line Loan shall bear interest on the outstanding principal amount thereof from the applicable borrowing date at a rate per annum equal to the Base Rate plus the Applicable Rate.

(b) While any Event of Default exists, the Borrower shall (i) automatically, in the case of an Event of Default under any of Sections 8.01(a) , (f) or (g) or (ii) upon the request of the Required Lenders, in the case of any other Event of Default, pay interest on the principal amount of all outstanding Obligations hereunder at a fluctuating interest rate per annum equal to the Default Rate, in each case to the fullest extent permitted by applicable Laws. Accrued and unpaid interest on past due amounts (including interest on past due interest) shall be due and payable upon demand.

(c) Interest on each Loan shall be due and payable in arrears on each Interest Payment Date applicable thereto and at such other times as may be specified herein. Interest hereunder shall be due and payable in accordance with the terms hereof before and after judgment, and before and after the commencement of any proceeding under any Debtor Relief Law.

2.09 Fees .

(a) Commitment Fee . The Borrower shall pay to the Administrative Agent for the account of each Lender in accordance with its Pro Rata Share, a commitment fee equal to the Applicable Rate times the actual daily amount by which the Aggregate Commitment exceeds the sum of (y) the Outstanding Amount of Loans and (z) the Outstanding Amount of L/C Obligations, subject to adjustment as provided in Section 2.16 . For the avoidance of doubt, the Outstanding Amount of Swing Line Loans shall not be counted towards or considered usage of the Aggregate Commitment for purposes of determining the commitment fee. The commitment fee shall accrue at all times during the Availability Period, including at any time during which one or more of the conditions in Section   4.02 is not met, and shall be due and payable quarterly in arrears on the first Business Day of each January, April, July and October, commencing with the first such date to occur after the Closing Date, and on the Maturity Date (and, if applicable, thereafter on demand). The commitment fee shall be calculated quarterly in arrears, and if there is any change in the Applicable Rate during any quarter, the actual daily amount shall be computed and multiplied by the Applicable Rate separately (but not invoiced separately) for each period during such quarter that such Applicable Rate was in effect.

(b) Other Fees . The Borrower shall pay to the Administrative Agent and/or the Lenders, as applicable, such other fees as may be set forth herein (including those set forth in Section 2.03(h) and 2.03(i) ) or as shall have been separately agreed upon in writing (including pursuant to the Fee Letters) in the amounts and at the times so specified. Such fees shall be fully earned when paid and shall not be refundable for any reason whatsoever.

 

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2.10 Computation of Interest and Fees; Retroactive Adjustments of Applicable Rate .

(a) All computations of interest for Base Rate Loans based on the prime commercial lending rate of the Administrative Agent shall be made on the basis of a year of 365 or 366 days, as the case may be, and actual days elapsed. All other computations of fees and interest shall be made on the basis of a 360-day year and actual days elapsed (which results in more fees or interest, as applicable, being paid than if computed on the basis of a 365-day year). Interest shall accrue on each Loan for the day on which the Loan is made, and shall not accrue on a Loan, or any portion thereof, for the day on which the Loan or such portion is paid, provided that any Loan that is repaid on the same day on which it is made shall, subject to Section 2.12(a) , bear interest for one day.

(b) If, as a result of any restatement of or other adjustment to the financial statements of the Parent or for any other reason, the Parent or the Required Lenders determine that (i) the Consolidated Leverage Ratio as calculated by the Parent as of any applicable date was inaccurate and (ii) a proper calculation of the Consolidated Leverage Ratio would have resulted in higher pricing for such period, the Borrower shall immediately and retroactively be obligated to pay to the Administrative Agent for the account of the applicable Lenders (or former Lenders), promptly on demand by the Administrative Agent (or, after the occurrence of an actual or deemed entry of an order for relief with respect to the Borrower under the Bankruptcy Code of the United States, automatically and without further action by the Administrative Agent or any Lender), an amount equal to the excess of the amount of interest and fees that should have been paid for such period over the amount of interest and fees actually paid for such period. This paragraph shall not limit the rights of the Administrative Agent or any Lender, as the case may be, under Section 2.08(b) or under Article VIII . The Borrower’s obligations under this paragraph shall survive the termination of the Aggregate Commitment and the repayment of all other Obligations hereunder. The failure of any Swing Line Lender to make any Swing Line Loan required to be made by it shall not relieve any other Swing Line Lender of its obligations hereunder; provided that the commitments of the Swing Line Lenders are several and no Swing Line Lender shall be responsible for any other Swing Line Lender’s failure to make Swing Line Loans as required.

2.11 Evidence of Debt .

(a) The Credit Extensions made by each Lender, each L/C Issuer and each Swing Line Lender shall be evidenced by one or more accounts or records maintained by such Lender, such L/C Issuer or such Swing Line Lender and by the Administrative Agent in the ordinary course of business. The accounts or records maintained by the Administrative Agent, each Swing Line Lender, each L/C Issuer and each Lender shall be prima facie evidence of the amount of the Credit Extensions made by the Lenders, the L/C Issuers and the Swing Line Lenders to the Borrower and the interest and payments thereon. Any failure to so record or any error in doing so shall not, however, limit or otherwise affect the obligation of the Borrower hereunder to pay any amount owing with respect to the Obligations. In the event of any conflict between the accounts and records maintained by any Lender and the accounts and records of the Administrative Agent in respect of such matters, the accounts and records of the Administrative Agent shall control in the absence of manifest error. Upon the request of any Lender made through the Administrative Agent, the Borrower shall execute and deliver to such Lender (through the Administrative Agent) a Revolving Note which shall evidence such Lender’s Loans in addition to such accounts or records. Upon the request of any Swing Line Lender to the Borrower, the Borrower shall execute and deliver to such Swing Line Lender a Swing Line Note, which shall evidence the applicable Swing Line Loans made by such Swing Line Lender to the Borrower in addition to such accounts or records. Each Lender and each Swing Line Lender may attach schedules to its Revolving Note or its Swing Line Note, as applicable, and endorse thereon the date, Type (if applicable), amount and maturity of its Loans and payments with respect thereto.

(b) In addition to the accounts and records referred to in Section 2.11(a) , each Lender and the Administrative Agent shall maintain in accordance with its usual practice accounts or records evidencing the purchases and sales by such Lender of participations in Letters of Credit and Swing Line Loans. In the event of any conflict between the accounts and records maintained by the Administrative Agent and the accounts and records of any Lender in respect of such matters, the accounts and records of the Administrative Agent shall control in the absence of manifest error.

 

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2.12 Payments Generally .

(a) All payments to be made by the Borrower shall be made without condition or deduction for any counterclaim, defense, recoupment or setoff. Except as otherwise expressly provided herein, all payments by the Borrower hereunder shall be made to the Administrative Agent, for the account of the respective Lenders to which such payment is owed, at the Administrative Agent’s Office in Dollars and in immediately available funds not later than 2:00 p.m. on the date specified herein. The Administrative Agent will promptly distribute to each Lender its Pro Rata Share (or other applicable share as provided herein) of such payment in like funds as received by wire transfer to such Lender’s Lending Office. All payments received by the Administrative Agent after 2:00 p.m. shall be deemed received on the next succeeding Business Day and any applicable interest or fee shall continue to accrue.

(b) If any payment to be made by the Borrower shall come due on a day other than a Business Day, payment shall be made on the next following Business Day, and such extension of time shall be reflected in computing interest or fees, as the case may be.

(c) (i) Unless the Borrower has notified the Administrative Agent, prior to the date any payment is required to be made by it to the Administrative Agent or any L/C Issuer hereunder, that the Borrower will not make such payment, the Administrative Agent may assume that the Borrower has timely made such payment and may (but shall not be so required to), in reliance thereon, make available a corresponding amount to the Person entitled thereto. If and to the extent that such payment was not in fact made to the Administrative Agent in immediately available funds, then each of the Lenders or such L/C Issuer, as the case may be, shall forthwith on demand repay to the Administrative Agent the portion of such assumed payment that was made available to such Lender or such L/C Issuer in immediately available funds, together with interest thereon in respect of each day from and including the date such amount was made available by the Administrative Agent to such Lender or such L/C Issuer to the date such amount is repaid to the Administrative Agent in immediately available funds at the greater of the Federal Funds Effective Rate and a rate determined by the Administrative Agent in accordance with banking industry rules on interbank compensation.

(ii) Unless the Administrative Agent shall have received notice from a Lender prior to the proposed date of any Borrowing of Eurodollar Rate Loans (or, in the case of any Borrowing of Loans accruing interest at the Base Rate, prior to 1:00 p.m. on the date of such Borrowing) that such Lender will not make available to the Administrative Agent such Lender’s share of such Borrowing, the Administrative Agent may assume that such Lender has made such share available on such date in accordance with Section 2.02 (or, in the case of a Borrowing of Base Rate Loans, that such Lender has made such share available in accordance with and at the time required by Section 2.02 ) and may, in reliance upon such assumption, make available to the Borrower a corresponding amount. In such event, if a Lender has not in fact made its share of the applicable Borrowing available to the Administrative Agent, then the applicable Lender and the Borrower severally agree to pay to the Administrative Agent forthwith on demand such corresponding amount in immediately available funds with interest thereon, for each day from and including the date such amount is made available to the Borrower to but excluding the date of payment to the Administrative Agent, at (A) in the case of a payment to be made by such Lender, the greater of the Federal Funds Effective Rate and a rate determined by the Administrative Agent in accordance with banking industry rules on interbank compensation plus any administrative, processing or similar fees customarily charged by the Administrative Agent in connection with the foregoing, and (B) in the case of a payment to be made by the Borrower, the interest rate applicable to Base Rate Loans. If the Borrower and such Lender shall pay such interest to the Administrative Agent for the same or an overlapping period, the Administrative Agent shall promptly remit to the Borrower the amount of such interest paid by the Borrower for such period. If such Lender pays its share of the applicable Borrowing to the Administrative Agent, then the amount so paid shall constitute such Lender’s Loan included in such Borrowing. Any payment by the Borrower shall be without prejudice to any claim the Borrower may have against a Lender that shall have failed to make such payment to the Administrative Agent.

A notice of the Administrative Agent to any Lender or the Borrower with respect to any amount owing under this Section 2.12(c) shall be conclusive, absent manifest error.

 

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(d) If any Lender makes available to the Administrative Agent funds for any Loan to be made by such Lender as provided in the foregoing provisions of this Article II , and such funds are not made available to the Borrower by the Administrative Agent because the conditions to the applicable Credit Extension set forth in Article IV are not satisfied or waived in accordance with the terms hereof, the Administrative Agent shall return such funds (in like funds as received from such Lender) to such Lender, without interest.

(e) The obligations of the Lenders hereunder to make Loans and to fund participations in Letters of Credit and Swing Line Loans are several and not joint. The failure of any Lender to make any Loan, to fund any such participation or to make any payment under Section 9.05 on any date required hereunder shall not relieve any other Lender of its corresponding obligation to do so on such date, and no Lender shall be responsible for the failure of any other Lender to so make its Loan, purchase its participation or make its payment under Section   9.05 .

(f) Nothing herein shall be deemed to obligate any Lender to obtain the funds for any Loan in any particular place or manner or to constitute a representation by any Lender that it has obtained or will obtain the funds for any Loan in any particular place or manner.

2.13 Sharing of Payments . If, other than as expressly provided elsewhere herein, any Lender shall obtain on account of the Loans made by it, or the participations in L/C Obligations or in Swing Line Loans held by it, any payment (whether voluntary, involuntary, through the exercise of any right of set-off, or otherwise) in excess of its ratable share (or other share contemplated hereunder) thereof, such Lender shall immediately (i) notify the Administrative Agent of such fact, and (ii) purchase from the other Lenders such participations in the Loans made by them, and/or such subparticipations in the participations in L/C Obligations and Swing Line Loans held by them, as the case may be, as shall be necessary to cause such purchasing Lender to share the excess payment in respect of such Loans or such participations, as the case may be, pro rata with each of them; provided, however, that if all or any portion of such excess payment is thereafter recovered from the purchasing Lender under any of the circumstances described in Section   10.06 (including pursuant to any settlement entered into by the purchasing Lender in its discretion), such purchase shall to that extent be rescinded and each other applicable Lender shall repay to the purchasing Lender the purchase price paid therefor, without interest thereon. The Borrower agrees that any Lender so purchasing a participation from another Lender may, to the fullest extent permitted by law, exercise all its rights of payment (including the right of set-off, but subject to Section 10.09 ) with respect to such participation as fully as if such Lender were the direct creditor of the Borrower in the amount of such participation. The Administrative Agent will keep records (which shall be conclusive and binding in the absence of manifest error) of participations purchased under this Section and will in each case notify the Lenders following any such purchases or repayments. Each Lender that purchases a participation pursuant to this Section shall from and after such purchase have the right to give all notices, requests, demands, directions and other communications under this Agreement with respect to the portion of the Obligations purchased to the same extent as though the purchasing Lender were the original owner of the Obligations purchased.

2.14 Cash Collateral . At any time that there shall exist a Defaulting Lender, within one Business Day following the written request of the Administrative Agent, any L/C Issuer or any Swing Line Lender (with a copy to the Administrative Agent), the Borrower shall Cash Collateralize the Fronting Exposure of the L/C Issuers and/or the Swing Line Lenders, as applicable, with respect to such Defaulting Lender (determined after giving effect to Section   2.16(a)(iv) and any Cash Collateral provided by such Defaulting Lender) in an amount not less than the Minimum Collateral Amount.

(a) Grant of Security Interest . The Borrower, and to the extent provided by any Defaulting Lender, such Defaulting Lender, hereby grants to the Administrative Agent, for the benefit of the L/C Issuers and the Lenders (including the Swing Line Lenders), a first priority security interest in all such Cash Collateral as security for the Defaulting Lender’s obligation to fund participations in respect of the applicable L/C Obligations and Swing Line Loans, to be applied pursuant to Section 2.14(b) below. If at any time the Administrative Agent determines that Cash Collateral is subject to any right or claim of any Person other than the Administrative Agent, any L/C Issuer and any Swing Line Lender as herein provided, or that the total amount of such Cash Collateral is less than the Minimum Collateral Amount, the Borrower will, promptly upon demand by the Administrative Agent, deliver to the Administrative Agent additional Cash Collateral in an amount sufficient to eliminate such deficiency (after giving effect to any Cash Collateral provided by the Defaulting Lender).

 

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(b) Application . Notwithstanding anything to the contrary contained in this Agreement, Cash Collateral provided under this Section 2.14 or Section 2.16 in respect of Letters of Credit and Swing Line Loans shall be applied to the satisfaction of the Defaulting Lender’s obligation to fund participations in respect of L/C Obligations and Swing Line Loans (including, as to Cash Collateral provided by a Defaulting Lender, any interest accrued on such obligation) for which the Cash Collateral was so provided, prior to any other application of such property as may otherwise be provided for herein.

(c) Termination of Requirement . Cash Collateral (or the appropriate portion thereof) provided to reduce the Fronting Exposure of the L/C Issuers and/or the Swing Line Lenders, as applicable, shall no longer be required to be held as Cash Collateral pursuant to this Section 2.14 following (i) the elimination of the applicable Fronting Exposure (including by the termination of Defaulting Lender status of the applicable Lender), or (ii) the good faith determination by the Administrative Agent, the L/C Issuers and the Swing Line Lenders that there exists excess Cash Collateral; provided that, subject to Section 2.16 , the Person providing Cash Collateral, the L/C Issuers and the Swing Line Lenders may agree that Cash Collateral shall be held to support future anticipated Fronting Exposure or other obligations; and provided further that to the extent such Cash Collateral was provided by the Borrower, such Cash Collateral shall remain subject to the security interest granted pursuant to the Loan Documents.

2.15 Increase in Aggregate Commitment .

(a) Upon notice to the Administrative Agent (which shall promptly notify the Lenders identified by the Borrower), the Borrower may from time to time during the term of this Agreement request an increase in the Aggregate Commitment to an amount not exceeding $700,000,000 (after giving effect to any such increase) at any time; provided that (i) any such request for an increase shall be in a minimum amount of $5,000,000 or a whole multiple of $1,000,000 in excess thereof; (ii) immediately before and after giving effect to such increase in the Aggregate Commitment, no Default or Event of Default shall have occurred and be continuing and (iii) after giving to such increase in the Aggregate Commitment (including any Borrowings to be made on the Increase Effective Date), the Parent shall be in compliance on a pro forma basis with the financial covenants set forth in Section 7.02 . At the time of sending such notice, the Borrower (in consultation with the Administrative Agent) shall specify the time period within which each applicable Lender is requested to respond (which shall in no event be less than ten Business Days from the date of delivery of such notice to the Lenders). Each Lender shall notify the Administrative Agent within such time period whether or not it agrees, in its sole discretion, to increase its Commitment and, if so, whether by an amount equal to, greater than, or less than its Pro Rata Share of such requested increase. Any Lender not responding within such time period shall be deemed to have declined to increase its Commitment. The Administrative Agent shall notify the Borrower of the Lenders’ responses to each request made hereunder. To achieve the full amount of a requested increase, the Borrower may also invite additional Eligible Assignees (including prior to, and in lieu of, inviting Lenders) to become Lenders pursuant to a joinder agreement in form and substance satisfactory to the Administrative Agent and its counsel.

(b) If the Aggregate Commitment is increased in accordance with this Section, the Administrative Agent and the Borrower shall determine the effective date (the “ Increase Effective Date ”) and the final allocation of such increase. The Administrative Agent shall promptly notify the Borrower and the Lenders of the final allocation of such increase and the Increase Effective Date. As a condition precedent to such increase, the Borrower shall have provided to the Administrative Agent the following, in form and substance reasonably satisfactory to the Administrative Agent:

(i) copies of corporate resolutions certified by a Responsible Officer of the Borrower, or such other evidence as may be satisfactory to the Administrative Agent, demonstrating that Borrower’s incurrence of indebtedness hereunder in the amount of the Aggregate Commitment as increased pursuant to this Section 2.15 and with a maturity date of the Stated Maturity Date, has been duly authorized by all necessary corporate action, together with, upon request of the Administrative Agent, an opinion of counsel to the Borrower (which, as to certain matters as agreed by the Administrative Agent, may be internal counsel) to such effect and as to such other customary matters regarding the transactions contemplated by this Section 2.15 as the Administrative Agent may reasonably request, and

(ii) a certificate dated as of the Increase Effective Date (in sufficient copies for each Lender) signed by a Responsible Officer of the General Partner, on behalf of the Parent and a Responsible Officer of the Borrower, certifying that, before and after giving effect to such increase, (A) the representations and warranties contained in Article V and the other Loan Documents are true and correct in all material respects (or, if qualified by materiality or Material Adverse Effect, in all respects) on and as of the Increase Effective Date, (or, if such representation speaks as of an earlier date, as of such earlier date), (B) no Default or Event of Default exists and (C) the Parent is in compliance, on a pro forma basis, with the financial covenants set forth in Section   7.02 hereof.

 

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(c) The Borrower shall prepay any Loans outstanding on the Increase Effective Date (and pay any additional amounts required pursuant to Section 3.05 ) to the extent necessary to keep the outstanding Loans ratable with any revised Pro Rata Shares arising from any nonratable increase in the Aggregate Commitment under this Section.

(d) This Section shall supersede any provisions in Sections 2.12 or 10.01 to the contrary.

2.16 Defaulting Lenders .

(a) Defaulting Lender Adjustments . Notwithstanding anything to the contrary contained in this Agreement, if any Lender becomes a Defaulting Lender, then, until such time as such Lender is no longer a Defaulting Lender:

(i) Waivers and Amendments . Such Defaulting Lender’s right to approve or disapprove any amendment, waiver or consent with respect to this Agreement shall be restricted as set forth in the definition of Required Lenders.

(ii) Defaulting Lender Waterfall . Any payment of principal, interest, fees or other amounts received by the Administrative Agent for the account of such Defaulting Lender (whether voluntary or mandatory, at maturity, pursuant to Article VIII or otherwise) or received by the Administrative Agent from a Defaulting Lender pursuant to Section 10.09 shall be applied at such time or times as may be determined by the Administrative Agent as follows: first , to the payment of any amounts owing by such Defaulting Lender to the Administrative Agent hereunder; second , to the payment on a pro rata basis of any amounts owing by such Defaulting Lender to the L/C Issuers or the Swing Line Lenders hereunder; third , to Cash Collateralize the Fronting Exposure of the L/C Issuers and the Swing Line Lenders with respect to such Defaulting Lender in accordance with Section 2.14 ; fourth , as the Borrower may request (so long as no Default or Event of Default exists), to the funding of any Loan or funded participation in respect of which such Defaulting Lender has failed to fund its portion thereof as required by this Agreement, as determined by the Administrative Agent; fifth , if so determined by the Administrative Agent and the Borrower, to be held in a deposit account and released pro rata in order to (A) satisfy such Defaulting Lender’s potential future funding obligations with respect to Loans and funded participations under this Agreement and (B) Cash Collateralize the L/C Issuers’ and the Swing Line Lenders’ future Fronting Exposure with respect to such Defaulting Lender with respect to future Letters of Credit and Swing Line Loans issued under this Agreement, in accordance with Section 2.14 ; sixth , to the payment of any amounts owing to the Lenders, the L/C Issuers or the Swing Line Lenders as a result of any final and non-appealable judgment of a court of competent jurisdiction obtained by any Lender, any L/C Issuer or any Swing Line Lender against such Defaulting Lender as a result of such Defaulting Lender’s breach of its obligations under this Agreement; seventh , so long as no Default or Event of Default exists, to the payment of any amounts owing to the Borrower as a result of any final and non-appealable judgment of a court of competent jurisdiction obtained by the Borrower against such Defaulting Lender as a result of such Defaulting Lender’s breach of its obligations under this Agreement; and eighth , to such Defaulting Lender or as otherwise directed by a court of competent jurisdiction; provided that if (1) such payment is a payment of the principal amount of any Loans or funded participations in Letters of Credit or Swing Line Loans in respect of which such Defaulting Lender has not fully funded its appropriate share, and (2) such

 

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Loans were made or the related Letters of Credit or Swing Line Loans were issued at a time when the conditions set forth in Section 4.02 were satisfied or waived, such payment shall be applied solely to pay the Loans of, and funded participations in Letters of Credit or Swing Line Loans owed to, all Non-Defaulting Lenders on a pro rata basis prior to being applied to the payment of any Loans of, or funded participations in Letters of Credit or Swing Line Loans owed to, such Defaulting Lender until such time as all Loans and funded and unfunded participations in L/C Obligations and Swing Line Loans are held by the Lenders pro rata in accordance with the Commitments without giving effect to Section 2.16(a)(iv) . Any payments, prepayments or other amounts paid or payable to a Defaulting Lender that are applied (or held) to pay amounts owed by a Defaulting Lender or to post Cash Collateral pursuant to this Section 2.16(a)(ii) shall be deemed paid to and redirected by such Defaulting Lender, and each Lender irrevocably consents hereto.

(iii) Certain Fees.

(A) No Defaulting Lender shall be entitled to receive any commitment fee payable under Section 2.09(a) for any period during which that Lender is a Defaulting Lender (and the Borrower shall not be required to pay any such fee that otherwise would have been required to have been paid to that Defaulting Lender except as set forth in clause (C) below).

(B) Each Defaulting Lender shall be entitled to receive Letter of Credit fees pursuant to Section 2.03(h) for any period during which that Lender is a Defaulting Lender only to the extent allocable to its Pro Rata Share of the stated amount of Letters of Credit for which it has provided Cash Collateral pursuant to Section 2.14 .

(C) With respect to any fee payable under Section 2.09 or Letter of Credit fee that would otherwise have been paid to any Defaulting Lender if it were not a Defaulting Lender, the Borrower shall (1) pay to each Non-Defaulting Lender that portion of any such fee otherwise payable to such Defaulting Lender with respect to such Defaulting Lender’s participation in L/C Obligations or Swing Line Loans that has been reallocated to such Non-Defaulting Lender pursuant to clause (iv) below, (2) pay to the L/C Issuers and Swing Line Lenders, as applicable, the amount of any such fee otherwise payable to such Defaulting Lender to the extent that the Defaulting Lender’s Fronting Exposure has been reallocated to the L/C Issuers’ or Swing Line Lenders’ Fronting Exposure to such Defaulting Lender, and (3) not be required to pay the remaining amount of any such fee.

(iv) Reallocation of Participations to Reduce Fronting Exposure . All or any part of such Defaulting Lender’s participation in L/C Obligations and Swing Line Loans shall be reallocated among the Non-Defaulting Lenders in accordance with their respective Pro Rata Shares of the Commitments (calculated without regard to such Defaulting Lender’s Commitment) but only to the extent that (x) the conditions set forth in Section 4.02 are satisfied at the time of such reallocation (and, unless the Borrower shall have otherwise notified the Administrative Agent at such time, the Borrower shall be deemed to have represented and warranted that such conditions are satisfied at such time), and (y) such reallocation does not cause the aggregate Outstanding Amount of the Loans of any Lender, plus such Lender’s Pro Rata Share of the Outstanding Amount of all L/C Obligations, plus such Lender’s Pro Rata Share of the Outstanding Amount of all Swing Line Loans to exceed such Non-Defaulting Lender’s Commitment. No reallocation hereunder shall constitute a waiver or release of any claim of any party hereunder against a Defaulting Lender arising from that Lender having become a Defaulting Lender, including any claim of the Borrower or a Non-Defaulting Lender as a result of such Non-Defaulting Lender’s increased exposure following such reallocation.

(v) Cash Collateral, Repayment of Swing Line Loans . If the reallocation described in clause (iv) above cannot, or can only partially, be effected, the Borrower shall, without prejudice to any right or remedy available to it hereunder or under Law, within one Business Day

 

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following the Borrower’s receipt of notice from the Administrative Agent, (x) as to Swing Line Loans, repay Swing Line Loans in an amount equal to the Fronting Exposure applicable to the Defaulting Lender or, if such Swing Line Loans cannot be repaid, Cash Collateralize the Borrower’s obligations corresponding to the Fronting Exposure applicable to the Defaulting Lender in accordance with the procedures set forth in Section 2.14 and (y) as to Letters of Credit, Cash Collateralize the L/C Issuer’s Fronting Exposure with respect to the Defaulting Lender in accordance with the procedures set forth in Section   2.14 .

(b) Defaulting Lender Cure . If the Borrower, the Administrative Agent, the L/C Issuers and the Swing Line Lenders agree in writing that a Lender is no longer a Defaulting Lender, the Administrative Agent will so notify the parties hereto, whereupon as of the effective date specified in such notice and subject to any conditions set forth therein (which may include arrangements with respect to any Cash Collateral), such Lender will, to the extent applicable, purchase at par that portion of outstanding Loans of the other Lenders or take such other actions as the Administrative Agent may determine to be necessary to cause the Loans and funded and unfunded participations in Letters of Credit and Swing Line Loans to be held by the Lenders in accordance with their Pro Rata Shares of their respective Commitments (without giving effect to Section 2.16(a)(iv) ), whereupon such Lender will cease to be a Defaulting Lender; provided that no adjustments will be made retroactively with respect to fees accrued or payments made by or on behalf of the Borrower while that Lender was a Defaulting Lender; and provided , further , that except to the extent otherwise expressly agreed by the affected parties, no change hereunder from Defaulting Lender to Lender will constitute a waiver or release of any claim of any party hereunder arising from that Lender’s having been a Defaulting Lender.

(c) New Swing Line Loans/Letters of Credit . So long as any Lender is a Defaulting Lender, the Swing Line Lenders shall not be required to fund any Swing Line Loans and L/C Issuers shall not be required to issue, extend, renew or increase any Letter of Credit, unless the applicable Swing Line Lender or the applicable L/C Issuer, as applicable, is satisfied that the related Fronting Exposure and the then outstanding Fronting Exposure applicable to the Defaulting Lender (x) will be 100% covered by the Commitments of the Non-Defaulting Lenders and/or (y) Cash Collateral will be provided by the Borrower in accordance with Section 2.14 , and participating interests in any newly made Swing Line Loan or any newly issued or increased Letter of Credit shall be allocated among non-Defaulting Lenders in a manner consistent with Section 2.16(a)(iv) (and such Defaulting Lender shall not participate therein).

ARTICLE III

TAXES, YIELD PROTECTION AND ILLEGALITY

3.01 Taxes .

(a) Defined Terms . For purposes of this Section 3.01 , the term “Lender” includes any L/C Issuer and the term “Law” includes FATCA.

(b) Payments Free of Taxes . Any and all payments by or on account of any obligation of a Loan Party under any Loan Document shall be made without deduction or withholding for any Taxes, except as required by Law. If any Law (as determined in the good faith discretion of an applicable Withholding Agent) requires the deduction or withholding of any Tax from any such payment by a Withholding Agent, then the applicable Withholding Agent shall be entitled to make such deduction or withholding and shall timely pay the full amount deducted or withheld to the relevant Governmental Authority in accordance with applicable Law and, if such Tax is an Indemnified Tax, then the sum payable by the applicable Loan Party shall be increased as necessary so that after such deduction or withholding has been made (including such deductions and withholdings applicable to additional sums payable under this Section 3.01(b) ), the applicable Recipient receives an amount equal to the sum it would have received had no such deduction or withholding for Indemnified Tax been made.

(c) Payment of Other Taxes by the Loan Parties . The Loan Parties shall timely pay to the relevant Governmental Authority in accordance with applicable Law, or at the option of the Administrative Agent timely reimburse it for the payment of, any Other Taxes.

 

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(d) Indemnification by the Loan Parties . The Loan Parties, jointly and severally, shall indemnify each Recipient, within ten (10) days after receipt by the Borrower of demand therefor, for the full amount of any Indemnified Taxes (including Indemnified Taxes imposed or asserted on or attributable to amounts payable under this Section 3.01 ) payable or paid by such Recipient or required to be withheld or deducted from a payment to such Recipient and any reasonable expenses arising therefrom or with respect thereto, whether or not such Indemnified Taxes were correctly or legally imposed or asserted by the relevant Governmental Authority. A certificate as to the amount of such payment or liability delivered to the Borrower by a Lender (with a copy to the Administrative Agent), or by the Administrative Agent on its own behalf or on behalf of a Lender, accompanied by the calculations by which such determination was made by such Lender, shall be conclusive absent manifest error.

(e) Evidence of Payments . As soon as practicable after any payment of Taxes by any Loan Party to a Governmental Authority pursuant to this Section 3.01 , such Loan Party shall deliver to the Administrative Agent the original or a certified copy of a receipt issued by such Governmental Authority evidencing such payment, a copy of the return reporting such payment or other evidence of such payment reasonably satisfactory to the Administrative Agent.

(f) Status of Lenders .

(i) Any Lender (which solely for purposes of this Section 3.01(f) shall include the Administrative Agent) that is entitled to an exemption from or reduction of withholding Tax with respect to payments made under any Loan Document shall deliver to the Borrower and the Administrative Agent, at the time or times reasonably requested by the Borrower or the Administrative Agent, such properly completed and executed documentation reasonably requested by the Borrower or the Administrative Agent as will permit such payments to be made without withholding or at a reduced rate of withholding. In addition, any Lender, if reasonably requested by the Borrower or the Administrative Agent, shall deliver such other documentation prescribed by Law or reasonably requested by the Borrower or the Administrative Agent as will enable the Borrower or the Administrative Agent to determine whether or not such Lender is subject to backup withholding or information reporting requirements. Notwithstanding anything to the contrary in the preceding two sentences, the completion, execution and submission of such documentation (other than such documentation set forth in Sections   3.01(f)(ii) , (B) and ( D) below) shall not be required if in the Lender’s reasonable judgment such completion, execution or submission would subject such Lender to any material unreimbursed cost or expense or would materially prejudice the legal or commercial position of such Lender.

(ii) Without limiting the generality of the foregoing,

(A) any Lender that is a U.S. Person shall deliver to the Borrower and the Administrative Agent on or prior to the date on which such Lender becomes a Lender under this Agreement (and from time to time thereafter upon the reasonable request of the Borrower or the Administrative Agent), executed originals of IRS Form W-9 certifying that such Lender is exempt from U.S. federal backup withholding tax;

(B) any Foreign Lender shall, to the extent it is legally entitled to do so, deliver to the Borrower and the Administrative Agent (in such number of copies as shall be requested by the recipient) on or prior to the date on which such Foreign Lender becomes a Lender under this Agreement (and from time to time thereafter upon the reasonable request of the Borrower or the Administrative Agent), whichever of the following is applicable:

(1) in the case of a Foreign Lender claiming the benefits of an income tax treaty to which the United States is a party (x) with respect to payments of interest under any Loan Document, properly completed and executed originals of IRS Form W-8BEN or IRS Form W-8BEN-E (or applicable successor form) establishing an exemption from, or reduction of, U.S. federal withholding Tax pursuant to the “interest” article of such tax treaty and

 

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(y) with respect to any other applicable payments under any Loan Document, properly completed and executed originals of IRS Form W-8BEN or IRS Form W-8BEN-E (or applicable successor form) establishing an exemption from, or reduction of, U.S. federal withholding Tax pursuant to the “business profits” or “other income” article of such tax treaty;

(2) properly completed and executed originals of IRS Form W-8ECI;

(3) in the case of a Foreign Lender claiming the benefits of the exemption for portfolio interest under Section 881(c) of the Code, (x) a certificate substantially in the form of Exhibit F-1 to the effect that such Foreign Lender is neither a “bank” within the meaning of Section 881(c)(3)(A) of the Code, a “10-percent shareholder” of the Borrower within the meaning of Section 881(c)(3)(B) of the Code, nor a “controlled foreign corporation” described in Section 881(c)(3)(C) of the Code (a “ U.S. Tax Compliance Certificate ”) and (y) properly completed and executed originals of IRS Form W-8BEN or IRS Form W-8BEN-E (or applicable successor form);

(4) properly completed and executed originals of IRS Form W-8EXP claiming an exemption from withholding Tax; or

(5) to the extent a Foreign Lender is not the beneficial owner, properly completed and executed originals of IRS Form W-8IMY, accompanied by IRS Form W-8ECI, IRS Form W-8BEN or IRS Form W-8BEN-E (or applicable successor form), a U.S. Tax Compliance Certificate substantially in the form of Exhibit F-2 or Exhibit F-3 , IRS Form W-9, and/or other certification documents from each beneficial owner, as applicable; provided that if the Foreign Lender is a partnership and one or more direct or indirect partners of such Foreign Lender are claiming the portfolio interest exemption, such Foreign Lender may provide a U.S. Tax Compliance Certificate substantially in the form of Exhibit F-4 on behalf of each such direct and indirect partner;

(C) any Foreign Lender shall, to the extent it is legally entitled to do so, deliver to the Borrower and the Administrative Agent (in such number of copies as shall be requested by the recipient) on or prior to the date on which such Foreign Lender becomes a Lender under this Agreement (and from time to time thereafter upon the reasonable request of the Borrower or the Administrative Agent), executed originals of any other form prescribed by applicable Law as a basis for claiming exemption from or a reduction in U.S. federal withholding Tax, duly completed, together with such supplementary documentation as may be prescribed by applicable Law to permit the Borrower or the Administrative Agent to determine the withholding or deduction required to be made; and

(D) if a payment made to a Lender under any Loan Document would be subject to U.S. federal withholding Tax imposed by FATCA if such Lender were to fail to comply with the applicable reporting requirements of FATCA (including those contained in Section 1471(b) or 1472(b) of the Code, as applicable), such Lender shall deliver to the Borrower and the Administrative Agent at the time or times prescribed by law and at such time or times reasonably requested by the Borrower or the Administrative Agent such documentation prescribed by Law (including as prescribed by Section 1471(b)(3)(C)(i) of the Code) and such additional documentation reasonably requested by the Borrower or the Administrative Agent as may be necessary for the Borrower and the Administrative Agent to comply with their obligations under FATCA and to determine that such Lender has complied with such Lender’s obligations under FATCA or to determine the amount to deduct and withhold from such payment. Solely for purposes of this clause (D) , “FATCA” shall include any amendments made to FATCA after the date of this Agreement.

 

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Each Lender agrees that if any form or certification it previously delivered expires or becomes obsolete or inaccurate in any respect, it shall update such form or certification or promptly notify the Borrower and the Administrative Agent in writing of its legal inability to do so.

(g) Treatment of Certain Refunds . If any party determines, in its sole discretion exercised in good faith, that it has received a refund of any Taxes as to which it has been indemnified pursuant to this Section 3.01 (including by the payment of additional amounts pursuant to this Section 3.01 ), it shall pay to the indemnifying party an amount equal to such refund (but only to the extent of indemnity payments made under this Section 3.01 with respect to the Taxes giving rise to such refund), net of all out-of-pocket expenses (including Taxes) of such indemnified party and without interest (other than any interest paid by the relevant Governmental Authority with respect to such refund). Such indemnifying party, upon the request of such indemnified party, shall repay to such indemnified party the amount paid over pursuant to this Section 3.01(g) (plus any penalties, interest or other charges imposed by the relevant Governmental Authority) in the event that such indemnified party is required to repay such refund to such Governmental Authority. Notwithstanding anything to the contrary in this Section 3.01(g) , in no event will the indemnified party be required to pay any amount to an indemnifying party pursuant to this Section   3.01(g) the payment of which would place the indemnified party in a less favorable net after-Tax position than the indemnified party would have been in if the Tax subject to indemnification and giving rise to such refund had not been deducted, withheld or otherwise imposed and the indemnification payments or additional amounts giving rise to such refund had never been paid. This Section 3.01(g) shall not be construed to require any indemnified party to make available its Tax returns (or any other information relating to its Taxes that it deems confidential) to the indemnifying party or any other Person.

(h) Indemnification of the Administrative Agent . Each Lender and each L/C Issuer shall severally indemnify the Administrative Agent within ten (10) days after demand therefor, for (i) any Indemnified Taxes attributable to such Lender (but only to the extent that the Loan Parties have not already indemnified the Administrative Agent for such Indemnified Taxes and without limiting the obligation of the Borrower to do so), (ii) any Taxes attributable to such Lender’s failure to comply with the provisions of Section 10.07(d) relating to the maintenance of a Participant Register and (iii) any Excluded Taxes attributable to such Lender, in each case, that are payable or paid by the Administrative Agent in connection with any Loan Document, and any reasonable expenses arising therefrom or with respect thereto, whether or not such Taxes were correctly or legally imposed or asserted by the relevant Governmental Authority. A certificate as to the amount of such payment or liability delivered to any Lender by the Administrative Agent shall be conclusive absent manifest error. Each Lender hereby authorizes the Administrative Agent to set off and apply any and all amounts at any time owing to such Lender under any Loan Document or otherwise payable by the Administrative Agent to the Lender from any other source against any amount due to the Administrative Agent under this Section 3.01(h) . The agreements in this Section 3.01(h) shall survive the resignation and/or replacement of the Administrative Agent.

(i) Survival . Each party’s obligations under this Section 3.01 shall survive the resignation or replacement of the Administrative Agent or any assignment of rights by, or the replacement of, a Lender, the termination of the Commitments and the repayment, satisfaction or discharge of all obligations under any Loan Document.

3.02 Illegality . If any Lender determines that any Change in Law has made it unlawful, or that any Governmental Authority has asserted that it is unlawful, for any Lender or its applicable Lending Office to make, maintain or fund Eurodollar Rate Loans, or to determine or charge interest rates based upon the Eurodollar Rate, then, on notice thereof by such Lender to the Borrower through the Administrative Agent, any obligation of such Lender to make or continue Eurodollar Rate Loans or to convert Base Rate Loans to Eurodollar Rate Loans shall be suspended until such Lender notifies the Administrative Agent and the Borrower that the circumstances giving rise to such determination no longer exist. Upon receipt of such notice, the Borrower shall, upon demand from such Lender (with a copy to the Administrative Agent), prepay or, if applicable, convert all Eurodollar Rate Loans of such Lender to Base Rate Loans, either on the last day of the Interest Period therefor, if such Lender may lawfully continue to maintain such Eurodollar Rate Loans to such day, or immediately, if such Lender may not lawfully continue to maintain such Eurodollar Rate Loans. Upon any such prepayment or conversion, the Borrower shall

 

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also pay accrued interest on the amount so prepaid or converted. Each Lender agrees to designate a different Lending Office if such designation will avoid the need for such notice and will not, in the good faith judgment of such Lender, otherwise be materially disadvantageous to such Lender.

3.03 Inability to Determine Rates . In connection with any request for a Eurodollar Rate Loan or a conversion to or continuation thereof, if for any reason (i) the Administrative Agent shall determine (which determination shall be conclusive and binding absent manifest error) that Dollar deposits are not being offered to banks in the London interbank Eurodollar market for the applicable amount and Interest Period of such Loan, (ii) the Administrative Agent shall determine (which determination shall be conclusive and binding absent manifest error) that reasonable and adequate means do not exist for the ascertaining the Adjusted Eurodollar Rate for such Interest Period with respect to a proposed Eurodollar Rate Loan or (iii) the Required Lenders shall determine (which determination shall be conclusive and binding absent manifest error) that the Adjusted Eurodollar Rate does not adequately and fairly reflect the cost to such Lenders of making or maintaining such Loans during such Interest Period, then the Administrative Agent shall promptly give notice thereof to the Borrower and each Lender. Thereafter, the obligation of the Lenders to make or maintain Eurodollar Rate Loans shall be suspended until the Administrative Agent (upon the instruction of the Required Lenders) revokes such notice. Upon receipt of such notice, the Borrower may revoke any pending request for a Borrowing of, conversion to or continuation of Eurodollar Rate Loans or, failing that, will be deemed to have converted such request into a request for a Borrowing of Base Rate Loans in the amount specified therein.

3.04 Increased Cost and Reduced Return; Capital Adequacy .

(a) If any Change in Law shall:

(i) impose, modify or deem applicable any reserve, special deposit, compulsory loan, insurance charge or similar requirement against assets of, deposits with or for the account of, or credit extended or participated in by, any Lender (except any reserve requirement reflected in the Adjusted Eurodollar Rate) or any L/C Issuer;

(ii) subject any Recipient to any Taxes (other than (A) Indemnified Taxes and (B) Excluded Taxes) on its loans, loan principal, letters of credit, commitments, or other obligations, or its deposits, reserves, other liabilities or capital attributable thereto; or

(iii) impose on any Lender or any L/C Issuer or the London interbank market any other condition, cost or expense (other than Taxes) affecting this Agreement or Loans made by such Lender or any Letter of Credit or participation therein;

and the result of any of the foregoing shall be to increase the cost to such Lender of making, converting to, continuing or maintaining any Loan the interest on which is determined by reference to the Adjusted Eurodollar Rate (or of maintaining its obligation to make any such Loan), or to increase the cost to such Lender or such L/C Issuer of participating in, issuing or maintaining any Letter of Credit (or of maintaining its obligation to participate in or to issue any Letter of Credit), or to reduce the amount of any sum received or receivable by such Lender or such L/C Issuer hereunder (whether of principal, interest or any other amount) then, upon request of such Lender or such L/C Issuer, the Borrower will pay to such Lender or such L/C Issuer, as the case may be, such additional amount or amounts as will compensate such Lender or such L/C Issuer, as the case may be, for such additional costs incurred or reduction suffered.

(b) If any Lender determines that any Change in Law regarding capital adequacy or liquidity, or compliance by such Lender (or its Lending Office) therewith, has the effect of reducing the rate of return on the capital of such Lender or any corporation controlling such Lender as a consequence of such Lender’s obligations hereunder (taking into consideration its policies with respect to capital adequacy or liquidity and such Lender’s desired return on capital), then from time to time upon demand of such Lender (with a copy of such demand to the Administrative Agent), the Borrower shall pay to such Lender such additional amounts as will compensate such Lender for such reduction.

 

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(c) A certificate of a Lender, an L/C Issuer or such other Recipient setting forth the Change in Law giving rise to a claim for compensation under paragraph (a) or (b) of this Section, the amount or amounts necessary to compensate such Lender, the Issuing Lender, such other Recipient or any of their respective holding companies, as the case may be, as specified in paragraph (a) or (b) of this Section (including an explanation in reasonable detail of the manner in which such amount or amounts was determined) and delivered to the Borrower, shall be conclusive absent manifest error. The Borrower shall pay such Lender, such L/C Issuer or such other Recipient, as the case may be, the amount shown as due on any such certificate within ten (10) days after receipt thereof.

(d) Failure or delay on the part of any Lender to demand compensation pursuant to this Section   3.04 shall not constitute a waiver of such Lender’s right to demand such compensation; provided that the Borrower shall not be required to compensate a Lender pursuant to this Section 3.04 for any increased costs incurred or reductions suffered more than 180 days prior to the date that such Lender notifies the Borrower of the Change in Law giving rise to such increased costs or reductions, and of such Lender’s intention to claim compensation therefor (except that, if the Change in Law giving rise to such increased costs or reductions is retroactive, then the 180-day period referred to above shall be extended to include the period of retroactive effect thereof).

3.05 Funding Losses . Upon demand of any Lender (with a copy to the Administrative Agent) from time to time, the Borrower shall promptly compensate such Lender for and hold such Lender harmless from any loss, cost or expense incurred by it as a result of:

(a) any continuation, conversion, payment of principal or prepayment of any Loan other than a Base Rate Loan on a day other than the last day of the Interest Period for such Loan (whether voluntary, mandatory, automatic, by reason of acceleration, or otherwise);

(b) any failure by the Borrower (for a reason other than the failure of such Lender to make a Loan) to prepay, borrow, continue or convert any Loan other than a Base Rate Loan on the date or in the amount notified by the Borrower (even if permitted to revoke such notice); or

(c) any assignment of a Eurodollar Rate Loan on a day other than the last day of the Interest Period therefor as a result of a request by the Borrower pursuant to Section   10.16 ;

including any loss or expense arising from the liquidation or reemployment of funds obtained by it to maintain such Loan (excluding loss of anticipated profits) or from fees payable to terminate the deposits from which such funds were obtained. The Borrower shall also pay any customary administrative fees charged by such Lender in connection with the foregoing.

For purposes of calculating amounts payable by the Borrower to the Lenders under this Section 3.05 , each Lender shall be deemed to have funded each Eurodollar Rate Loan made by it at the Adjusted Eurodollar Rate for such Loan by a matching deposit or other borrowing in the London interbank eurodollar market for a comparable amount and for a comparable period, whether or not such Eurodollar Rate Loan was in fact so funded.

3.06 Mitigation Obligations; Designation of a Different Lending Office . If any Lender requests compensation under Section 3.04 , or if the Borrower is required to pay any Indemnified Taxes or additional amount to any Lender or any Governmental Authority for the account of any Lender pursuant to Section 3.01 , then such Lender shall (at the request of the Borrower) use reasonable efforts to designate a different Lending Office for funding or booking its Loans hereunder or to assign its rights and obligations hereunder to another of its offices, branches or affiliates, if, in the good faith judgment of such Lender, such designation or assignment (i) would eliminate or reduce amounts payable pursuant to Section 3.01 or 3.04 , as the case may be, in the future, and (ii) would not subject such Lender to any unreimbursed cost or expense and would not otherwise be materially disadvantageous to such Lender. The Borrower hereby agrees to pay all reasonable costs and expenses incurred by any Lender in connection with any such designation or assignment.

3.07 Matters Applicable to all Requests for Compensation . A certificate of the Administrative Agent or any Lender claiming compensation under this Article III and setting forth the additional amount or

 

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amounts to be paid to it hereunder (including, if requested by the Borrower, an explanation in reasonable detail of the manner in which such amount or amounts was determined) shall be conclusive in the absence of manifest error. In determining such amount, the Administrative Agent or such Lender may use any reasonable averaging and attribution methods.

3.08 Survival . All of the Borrower’s obligations under this Article III shall survive termination of the Aggregate Commitment and repayment of all other Obligations hereunder.

ARTICLE IV

CONDITIONS PRECEDENT TO CLOSING DATE AND TO CREDIT EXTENSIONS

4.01 Conditions of Closing and Initial Credit Extension . The obligation of each Lender to enter into this Agreement and make its initial Credit Extension hereunder is subject to the satisfaction of the following conditions precedent:

(a) The Administrative Agent’s receipt of the following, each properly executed by a Responsible Officer of the applicable Loan Party (or of the general partner, board of directors or other governing body, as applicable, of such Loan Party), each dated the Closing Date (unless otherwise specified) and each in form and substance reasonably satisfactory to the Administrative Agent:

(i) counterparts of this Agreement and the Guarantee Agreement, in such number as may be requested by counsel to the Administrative Agent;

(ii) for each Lender so requesting, (A) a Revolving Note executed by the Borrower in favor of such Lender and (B) a Swing Line Note executed by the Borrower in favor of such Swing Line Lender;

(iii) a certificate of a Responsible Officer of (A) each Loan Party (or of the general partner or sole member of such Loan Party) certifying as to the incumbency and genuineness of the signature of each Responsible Officer of such Loan Party (or the general partner or sole member of such Loan Party) executing the Loan Documents to which such Loan Party is a party and certifying that attached thereto is a true, correct and complete copy of (1) the certificate or articles of limited partnership, formation or incorporation, as applicable, of such Loan Party and all amendments thereto, certified as of a recent date by the appropriate Governmental Authority in its jurisdiction of organization, (2) the limited partnership agreement, operating agreement, bylaws or other governing document, as applicable, of such Loan Party as in effect on the Closing Date and (3) resolutions duly adopted by the general partner, board of directors, or other governing body, as applicable, of such Loan Party authorizing and approving the transactions contemplated hereunder and the execution, delivery and performance of this Agreement and the other Loan Documents to which it is a party and (B) the General Partner, certifying that attached thereto is a true, correct and complete copy of (1) the certificate of organization of the General Partner and all amendments thereto, certified as of a recent date by the appropriate Governmental Authority in its jurisdiction of organization and (2) the limited liability company agreement of the Parent as in effect on the Closing Date;

(iv) certificates as of a recent date setting forth the good standing of each Loan Party under the Laws of (A) its jurisdiction of organization and (B) each other jurisdiction in which the failure to be qualified to do business in such jurisdiction would reasonably be expected to have a Material Adverse Effect;

(v) an opinion of Andrews Kurth LLP, counsel to the Loan Parties, addressed to the Administrative Agent and each Lender, in each case as to such customary matters regarding the transactions contemplated herein as the Administrative Agent or its counsel may reasonably request, which opinion shall permit reliance thereon by assignees permitted by Section   10.07(b) , subject to customary conditions;

 

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(vi) a certificate of a Responsible Officer of the General Partner, on behalf of the Parent, certifying (A) that the representations and warranties of the Loan Parties contained in Article V are true and correct in all material respects (or, if qualified by materiality or Material Adverse Effect, in all respects) on and as of the Closing Date, (B) that no Default exists or would result from the execution of this Agreement, (C) since December 31, 2015, there has not occurred any event or condition that has had or would be reasonably expected, either individually or in the aggregate, to have a Material Adverse Effect and (D) to the matters set forth in Section 4.01(b) , Section 4.01(d) and Section 4.01(g) ;

(vii) a certificate signed by the chief financial officer of the General Partner or another Responsible Officer of the General Partner primarily responsible for the financial affairs of the Parent, on behalf of the Parent, certifying that on and as of the Closing Date, after giving effect to the Transactions, the Parent and its Subsidiaries are Solvent on a consolidated basis;

(viii) UCC search certificates in each jurisdiction reasonably requested by the Administrative Agent or its counsel, in each case reflecting no Liens on the property of the Parent and its Subsidiaries other than Liens permitted pursuant to Section   7.01 ;

(ix) the Initial Financial Statements and the Pro Forma Financial Statements.

(x) such other assurances, certificates, documents, consents or opinions as the Administrative Agent, the L/C Issuers, the Swing Line Lenders or the Required Lenders reasonably may require; and

(b) The Parent shall have received all material governmental, partner and third party consents and approvals necessary (or any other material consents as determined in the reasonable discretion of the Administrative Agent) in connection with the Transactions and the other transactions contemplated hereby, and such consents and approvals shall be in full force and effect and all applicable waiting periods and appeal periods shall have expired.

(c) There shall not have occurred any event, change, occurrence or circumstance since December 31, 2015 that, either individually or in the aggregate, has had or could reasonably be expected to have a Material Adverse Effect.

(d) The IPO shall have been consummated in accordance with the Registration Statement as in effect on the Closing Date in all material respects, without any amendment, supplement or modification thereto that is materially adverse to the interest of the Lenders, and shall have resulted in the Parent receiving gross cash proceeds of at least $200,000,000.

(e) Any fees and expenses (including Attorney Costs) required to be paid in connection with the Loan Documents and for which invoices have been presented at least one Business Day prior to the Closing Date shall have been paid.

(f) The Borrower shall have provided to the Administrative Agent and the Lenders evidence that the Parent and its Subsidiaries are carrying the insurance required to be maintained under Section 6.03(b) .

(g) After giving effect to the Transactions on the Closing Date, neither the Parent nor any of its Subsidiaries shall have any material Debt for borrowed money other than Debt under this Agreement.

(h) The Parent and the Borrower shall have provided to the Administrative Agent and the Lenders, to the extent requested at least five Business Days prior to the Closing Date, with respect to the Parent, the Borrower and the other Guarantors, (i) the documentation and other information requested by the Administrative

 

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Agent and any Lender in order to comply with the requirements of the Patriot Act, (ii) the documentation and other information requested by the Administrative Agent in order to comply with all “know your customer” requirements and (iii) all anti-money laundering documentation reasonably requested by the Administrative Agent or any Lender.

Without limiting the generality of the provisions of Section 9.04, for purposes of determining compliance with the conditions specified in this Section 4.01, each Lender that has signed this Agreement shall be deemed to have consented to, approved or accepted or to be satisfied with, each document or other matter required under this Section 4.01 to be consented to or approved by or acceptable or satisfactory to a Lender unless the Administrative Agent shall have received notice from such Lender prior to the effectiveness of this Agreement specifying its objection thereto. All documents executed or submitted pursuant to this Section 4.01 by and on behalf of the Parent or any of its Subsidiaries shall be in form and substance reasonably satisfactory to the Administrative Agent and its counsel. The Administrative Agent shall notify the Borrower, the Lenders and the L/C Issuers of the Closing Date, and such notice shall be conclusive and binding. Notwithstanding the foregoing, the obligations of the Lenders to make Loans and of the L/C Issuers to issue Letters of Credit hereunder shall not become effective unless each of the foregoing conditions shall have been satisfied (or waived in accordance with Section   10.03 ) at or prior to 5:00 p.m. on October 15, 2016 (and, in the event such conditions shall not have been so satisfied or waived, the Commitments shall terminate at such time).

4.02 Conditions to all Credit Extensions . The obligation of each Lender to honor any Request for Credit Extension (other than (i) a Loan Notice requesting only a conversion of Loans to the other Type or (ii) a continuation of Eurodollar Rate Loans) is subject to the following conditions precedent:

(a) The representations and warranties of each Loan Party set forth in Article V and in any other Loan Document, or which are contained in any document furnished at any time under or in connection herewith or therewith, shall be true and correct in all material respects (or if qualified by materiality or Material Adverse Effect, in all respects) on and as of the date of such Credit Extension (or, if such representation speaks as of an earlier date, as of such earlier date).

(b) No Default or Event of Default shall exist, or would result from such proposed Credit Extension.

(c) The Administrative Agent and, if applicable, the applicable L/C Issuer or applicable Swing Line Lender shall have received a Request for Credit Extension in accordance with the requirements hereof.

Each Request for Credit Extension (other than (i) a Loan Notice requesting only a conversion of Loans to the other Type or (ii) a continuation of Eurodollar Rate Loans) submitted by the Borrower shall be deemed to be a representation and warranty that the conditions specified in Sections 4.02(a) and (b) have been satisfied on and as of the date of the applicable Credit Extension.

ARTICLE V

REPRESENTATIONS AND WARRANTIES

The Loan Parties represent and warrant to the Lenders as of the Closing Date and thereafter as of each date required by Section 4.02 and as of any other date as agreed by a Loan Party:

5.01 Corporate Existence and Power . The General Partner is the sole general partner of the Parent. Each Loan Party and each Subsidiary is a corporation, partnership or limited liability company duly incorporated or formed, as applicable, validly existing and in good standing under the Laws of the jurisdiction of its incorporation or formation, as applicable, and has all organizational powers and all material Authorizations required to carry on its business as now conducted. Each Loan Party and each Subsidiary is qualified to do business, and is in good standing, in every jurisdiction where such qualification is required, except where the failure to do so, individually or in the aggregate, would not reasonably be expected to have a Material Adverse Effect.

 

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5.02 Corporate and Governmental Authorization; No Contravention; No Default . The Transactions, including the Borrower’s incurrence of Debt hereunder, and the execution, delivery and performance by the Loan Parties of each Loan Document to which such Person is a party, (a) are within the corporate or other organizational powers of such Person, (b) have been duly authorized by all necessary corporate or other organizational action, (c) require no action by or in respect of, or filing with, any Governmental Authority (except such as has been obtained and any reports required to be filed by such Person with the SEC), (d) do not contravene, or constitute a default under, (i) any provision of applicable law or regulation or of any Organization Documents of such Person or (ii) any material agreement, judgment, injunction, order, decree or other instrument binding upon the Parent or any of its Subsidiaries, or result in the creation or imposition of any Lien on any asset of such Person or any of its Subsidiaries that is not permitted hereunder. No Default or Event of Default has occurred and is continuing or would result from the consummation of the Transactions, the transactions contemplated by this Agreement or any other Loan Document.

5.03 Binding Effect . Each Loan Document has been duly executed and delivered by each Loan Party that is party thereto. This Agreement and each other Loan Document constitutes a valid and binding obligation of each Loan Party that is party thereto, in each case, enforceable in accordance with its terms, except as such enforcement may be limited by bankruptcy, insolvency or similar Laws of general application relating to the enforcement of creditors’ rights.

5.04 Financial Information .

(a) The Initial Financial Statements (i) present fairly, in all material respects, the combined financial position and results of operations and cash flows of the Parent’s predecessor and its Subsidiaries on a consolidated basis as of such dates and for such periods in conformity with GAAP and (ii) show, to the extent required by GAAP and together with all footnotes to such financial statements, all material indebtedness and other liabilities, direct or contingent, of the Parent’s predecessor and its Subsidiaries as of the date thereof, including liabilities for taxes, material commitments and Debt.

(b) The Pro Forma Financial Statements were prepared in good faith on the basis of assumptions, data, information, tests or conditions believed to be reasonable at the time such Pro Forma Financial Statements were furnished. The Pro Forma Financial Statements fairly present in all material respects the financial position of the Parent and its Subsidiaries on a consolidated basis as of date thereof and after giving effect to the Transactions and were prepared in a manner consistent with GAAP (except as otherwise noted therein) consistently applied.

(c) The financial information delivered to the Lenders pursuant to Sections   6.01(a) and (b) (i) fairly presents, in all material respects, in conformity with GAAP, the financial position of the Parent and its Subsidiaries as of such date and their consolidated results of operations and cash flows as of such date (subject, in the case of interim statements, to normal year-end adjustments and the absence of footnotes), and (ii) shows, to the extent required by GAAP and together with all footnotes to such financial statements, all material indebtedness and other liabilities, direct or contingent, of the Parent and its Subsidiaries as of the date thereof, including liabilities for taxes, material commitments and Debt.

(d) Since the later of the date of (i) December 31, 2015 or (ii) the most recent audited financial statements delivered pursuant to Section 6.01(a)(i) , there has been no event or circumstance, either individually or in the aggregate, that has had or could reasonably be expected to have a Material Adverse Effect.

5.05 Litigation . There is no action, suit, proceeding or investigation pending against, or, to the knowledge of the Parent or the Borrower, threatened against or affecting, the Parent or any of its Subsidiaries before any Governmental Authority (a) relating to this Agreement or the Transactions or (b) which could reasonably be expected to have a Material Adverse Effect.

5.06 Compliance with ERISA . Each member of the ERISA Group has fulfilled its obligations under the minimum funding standards of ERISA and the Code with respect to each Plan and is in compliance in all material respects with the presently applicable provisions of ERISA and the Code with respect to each Plan. No member of the ERISA Group has (i) sought a waiver of the minimum funding standards under the Pension Funding

 

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Rules, (ii) failed to make any contribution or payment to any Plan or Multiemployer Plan or in respect of any Benefit Arrangement, or made any amendment to any Plan or Benefit Arrangement, which has resulted or could result in the imposition of a Lien or the posting of a bond or other security under ERISA or the Code, or (iii) incurred any liability under Title IV of ERISA other than a liability to the PBGC for premiums under Section 4007 of ERISA.

5.07 Environmental Matters . In the ordinary course of its business, the Parent conducts an ongoing review of the effect of Environmental Laws on the business, operations and properties of the Parent or any of its Subsidiaries, in the course of which it identifies and evaluates associated liabilities and costs (including, without limitation, any capital or operating expenditures required for clean-up or closure of properties presently or previously owned, any capital or operating expenditures required to achieve or maintain compliance with environmental protection standards imposed by law or as a condition of any Authorizations, any related constraints on operating activities, including any periodic or permanent shutdown of any facility or reduction in the level of or change in the nature of operations conducted thereat, any costs or liabilities in connection with off-site disposal of wastes or Hazardous Substances, and any actual or potential liabilities to third parties, including employees, and any related costs and expenses). On the basis of this review, the Parent has concluded that such associated liabilities and costs, including the costs of compliance with Environmental Laws, could not reasonably be expected to have a Material Adverse Effect. Neither the Parent nor any of its Subsidiaries has failed to comply with any Environmental Laws or to obtain any obtain, maintain or comply with any Authorization under any Environmental Laws, except for matters that, individually or in the aggregate, could not reasonably be expected to have a Material Adverse Effect.

5.08 Taxes . The Parent and its Subsidiaries have properly and timely filed all United States Federal and state income tax returns and all other material tax returns which are required to have been filed by them, and have paid all taxes due and payable by them pursuant to such returns or pursuant to any material assessment received by the Parent and its Subsidiaries (other than those not yet delinquent and payable without premium or penalty, and except for those being diligently contested in good faith by appropriate proceedings, and in each case, for which adequate reserves and provisions for taxes have been made on the books of the applicable Person). The charges, accruals and reserves on the books of the Parent and its Subsidiaries in respect of taxes or other governmental charges are, in the reasonable opinion of the Parent, adequate.

5.09 Subsidiaries . Set forth on Schedule 5.09 is a complete and accurate list as of the Closing Date each of the Parent’s Subsidiaries (other than the Borrower), together with its jurisdiction of formation and the Parent’s direct or indirect percentage ownership therein.

5.10 Regulatory Restrictions on Borrowing; Margin Regulations .

(a) None of the Parent, any Person Controlling the Parent, the Borrower or any Subsidiary of the Parent is an “ investment company ” within the meaning of the Investment Company Act of 1940, as amended.

(b) The Borrower is not engaged and will not engage, principally or as one of its important activities, in the business of purchasing or carrying margin stock (within the meaning of Regulation U issued by the FRB), or extending credit for the purpose, whether immediate, incidental or ultimate, of purchasing or carrying margin stock. No part of the proceeds of any Credit Extension will be used for any purpose which violates the provisions of Regulations T, U or X of the FRB.

5.11 Full Disclosure . No statement, information, report, representation, or warranty (collectively, the “ Information ”) made by any Loan Party in any Loan Document or furnished to the Administrative Agent or any Lender in writing by or on behalf of any Loan Party in connection with any Loan Document (as modified or supplemented by other Information so furnished), taken as a whole, contains, as of the date such Information was furnished (or, if such Information expressly relates to a specific date, as of such specific date) any untrue statement of a material fact or omits, as of the date such Information was furnished (or, if such Information expressly related to a specific date, as of such specific date), any material fact required to be stated therein or necessary to make the statements therein, in light of the circumstances under which they were made, not misleading, provided, that with respect to projected financial information, each Loan Party represents only that such information was prepared in good faith based upon assumptions believed by it to be reasonable at the time.

 

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5.12 Compliance with Laws . The Parent and each of its Subsidiaries is in compliance with all laws, rules, regulations, orders, decrees and requirements of Governmental Authorities applicable to it or to its properties (including, without limitation, the Code), except where (a) such failure to comply could not have or be reasonably expected to have a Material Adverse Effect or (b) the necessity or fact of compliance therewith is being contested in good faith by appropriate proceedings and the failure to comply during such time could not have or be reasonably expected to have a Material Adverse Effect.

5.13 Contribution and IPO . Each of the Material Contracts and each other material agreement and document (including schedules and exhibits thereto) relating to the Contribution and the IPO (i) is consistent in all material respects with the description thereof in the Registration Statement and (ii) has been duly executed and delivered by each Loan Party and each Subsidiary party thereto and constitutes the legal, valid and binding obligation of each Loan Party and each Subsidiary party thereto, enforceable in accordance with its terms, except as enforceability may be limited by general principles of equity and bankruptcy, insolvency, reorganization or similar laws affecting creditors’ rights generally and by moratorium laws from time to time in effect.

5.14 Ownership of Property; No Liens; Insurance . Each of the Parent and its Subsidiaries have good record and indefeasible title in fee simple to, or valid leasehold interests in, or a valid easement estate in, all real property, and good title to all material personal property, in each case necessary or used in the ordinary conduct of its business, except for defects that, individually or in the aggregate, (i) do not materially interfere with the ordinary conduct of its business or (ii) could not reasonably be expected to result in a Material Adverse Effect. None of such property is subject to any Lien, except for Liens permitted by Section 7.01 . The Parent and each of its Subsidiaries are insured in the manner required pursuant to Section 6.03(b) .

5.15 Solvency . The Parent and its Subsidiaries, on a consolidated basis, are, and after giving effect to the Transactions will be, Solvent.

5.16 Patriot Act. Each of the Parent, the Borrower and their respective Subsidiaries are in compliance in all material respects with the material provisions of the Patriot Act, and each such Person has provided to the Administrative Agent and the Lenders all information related to it (including but not limited to its name, address and tax identification numbers (if applicable)) reasonably requested in writing by the Administrative Agent that is required by the Patriot Act to be obtained by the Administrative Agent or any Lender.

5.17 Anti-Corruption Laws and Sanctions . The Parent has implemented and maintains in effect policies and procedures designed to ensure compliance by the Parent, the Borrower, their respective Subsidiaries and each such Person’s directors, officers, employees and agents with Anti-Corruption Laws and applicable Sanctions (and such policies and procedures are applicable to such directors, officers, employees and agents of Noble that serve as the directors, officers, employees and agents of the Parent, the Borrower and their respective Subsidiaries), and the Parent, the Borrower, their respective Subsidiaries and each such Person’s officers and employees (or, as applicable, the officers and employees of Noble that serve as the officers and employees of the Parent, the Borrower and their respective Subsidiaries), and to the knowledge of the Parent and the Borrower, any director and agent of the Parent, the Borrower and their respective Subsidiaries (or, as applicable, the directors and agents of Noble that serve as the directors and agents of the Parent, the Borrower and their respective Subsidiaries), are in compliance with Anti-Corruption Laws and applicable Sanctions in all material respects. None of (a) the Parent, the Borrower or their respective Subsidiaries, or to the knowledge of the Parent or the Borrower, any of their respective directors, officers or employees (or, as applicable, the directors, officers and employees of Noble that serve as the directors, officers and employees of the Parent, the Borrower and their respective subsidiaries) or (b) to the knowledge of the Parent or the Borrower, any agent of the Parent, the Borrower and their respective Subsidiaries (or, as applicable, any agent of Noble that serves as an agent of the Parent, the Borrower and their respective subsidiaries) that will act in any capacity in connection with or benefit from the credit facility established hereby, is a Sanctioned Person. No Loan or Letter of Credit or use of proceeds therefrom will violate Anti-Corruption Laws or applicable Sanctions.

5.18 Compliance with Material Agreements . The Parent and each of its Subsidiaries is, and, to the knowledge of the Parent, Noble and its Subsidiaries are, in compliance with each Material Contract and no defaults exist thereunder, except where such non-compliance or such defaults, individually or in the aggregate, could not reasonably be expected to have a Material Adverse Effect.

5.19 EEA Financial Institutions .   No Loan Party is an EEA Financial Institution.

 

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ARTICLE VI

AFFIRMATIVE COVENANTS

The Loan Parties agree and covenant that, so long as any Lender has any Commitment hereunder, any Letter of Credit remains outstanding (unless such Letter of Credit has been cash collateralized in a manner acceptable to the Administrative Agent and the applicable L/C Issuer or other arrangements with respect thereto have been made that are satisfactory to the Administrative Agent and such L/C Issuer) or any Obligation payable hereunder remains unpaid:

6.01 Information; Notices of Material Events . The Parent and/or Borrower, as applicable, will deliver to the Administrative Agent and each Lender:

(a) as soon as available, and in any event within the earlier of (i) ninety (90) days after the end of each fiscal year of the Parent and (ii) five (5) days after such information is required to be filed with the SEC, a consolidated balance sheet of the Parent and its Subsidiaries as of the end of such fiscal year and the related consolidated statements of operations, cash flows and changes in partners’ capital for such fiscal year, setting forth in each case in comparative form the figures for the previous fiscal year, all in reasonable detail (and which shall include, for the avoidance of doubt, a reconciliation of the net income and EBITDA attributable to the non-controlling interest in any Subsidiary that is not wholly-owned by the Loan Parties, in each case in the same or similar manner as set forth in the Registration Statement or otherwise reasonably acceptable to the Administrative Agent) and prepared in accordance with GAAP, audited and accompanied by a report and opinion of an independent certified public accountant of nationally recognized standing selected by the Parent, which report and opinion shall be prepared in accordance with generally accepted auditing standards and shall not be subject to any “going concern” or like qualification or exception or any qualification or exception as to the scope of such audit;

(b) as soon as available, and in any event within the earlier of (i) forty-five (45) days after the end of each of the first three quarters of each fiscal year of the Parent and (ii) five (5) days after such information is required to be filed with the SEC, a consolidated balance sheet of the Parent and its Subsidiaries as of the end of such quarter and the related consolidated statements of operations and cash flows for such quarter and for the portion of the Parent’s fiscal year ended at the end of such quarter, setting forth in the case of such statements of operations and cash flows, in comparative form the figures for the corresponding quarter and the corresponding portion of the Parent’s previous fiscal year (and which shall include, for the avoidance of doubt, a reconciliation of the net income and EBITDA attributable to the non-controlling interest in any Subsidiary that is not wholly-owned by the Loan Parties, in each case in the same or similar manner as set forth in the Registration Statement or otherwise reasonably acceptable to the Administrative Agent), all certified (subject to normal year-end adjustments and the absence of footnotes) as to fairness of presentation, conformity to GAAP and consistency by the chief financial officer or the chief accounting officer of the General Partner, on behalf of the Parent;

(c) on or before the applicable date on which the related financial certificates are required to be delivered pursuant to clause   (a) or (b) above, as applicable, a certificate of a Responsible Officer of the General Partner, on behalf of the Parent, substantially in the form of the Compliance Certificate attached hereto, including a complete and accurate list, as of the last day of the period covered by such financial statements, of each of the Parent’s Subsidiaries, together with its jurisdiction of formation and the Parent’s direct or indirect percentage ownership therein and, until the Guarantee Release Date, whether it is a Material Subsidiary;

(d) promptly (and in any event within five Business Days) after any officer of the General Partner, on behalf of the Parent, or of the Borrower or any other Loan Party, obtains actual knowledge thereof (i) of any Default, if such Default is then continuing, a certificate of a Responsible Officer of the Borrower setting forth the details thereof and the action which the Parent and/or the Borrower is taking or proposes to take with respect thereto and (ii) of any other event, circumstance or development (including any environmental matters and/or litigation or governmental proceedings pending against the Parent and its Subsidiaries) that would reasonably be expected to result in a Material Adverse Effect;

 

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(e) promptly upon the mailing thereof to the unitholders of the Parent generally, copies of all financial statements, reports and proxy statements so mailed;

(f) promptly upon the filing thereof, copies of all registration statements (other than the exhibits thereto and any registration statements on Form S-8 or its equivalent) and reports on Forms 10-K, 10-Q and 8-K (or their equivalents) which the Parent shall have filed with the SEC;

(g) if and when any member of the ERISA Group (i) gives or is required to give notice to the PBGC of any “reportable event” (as defined in Section 4043 of ERISA) with respect to any Plan which might constitute grounds for a termination of such Plan under Title IV of ERISA, or knows that the plan administrator of any Plan has given or is required to give notice of any such reportable event, a copy of the notice of such reportable event given or required to be given to the PBGC; (ii) receives notice of complete or partial withdrawal liability under Title IV of ERISA or notice that any Multiemployer Plan is in reorganization, is insolvent or has been terminated, a copy of such notice; (iii) receives notice from the PBGC under Title IV of ERISA of an intent to terminate, impose liability (other than for premiums under Section 4007 of ERISA) in respect of, or appoint a trustee to administer any Plan, a copy of such notice; (iv) applies for a waiver of the minimum funding standard under the Pension Funding Rules, a copy of such application; (v) gives notice of intent to terminate any Plan under Section 4041(c) of ERISA, a copy of such notice and other information filed with the PBGC; (vi) gives notice of withdrawal from any Plan pursuant to Section 4063 of ERISA, a copy of such notice; (vii) fails to make any payment or contribution to any Plan or Multiemployer Plan or in respect of any Benefit Arrangement or makes any amendment to any Plan or Benefit Arrangement which has resulted or could result in the imposition of a Lien or the posting of a bond or other security, a certificate of the chief financial officer or the chief accounting officer of the General Partner, on behalf of the Parent, setting forth details as to such occurrence and action, if any, which the Parent or applicable member of the ERISA Group is required or proposes to take; or (viii) determines that any Pension Plan is considered an at-risk plan or a plan in endangered or critical status within the meaning of Sections 430, 431 and 432 of the Code or Sections 303, 304 and 305 of ERISA, a certification of funding status from the enrolled actuary for the Pension Plan, which in the case of each of clauses (i) , (ii) , (iii) and (viii) above, could cause one or more members of the ERISA Group to incur liability;

(h) promptly upon any announcement by S&P or Moody’s of any issuance of or change in a Public Debt Rating of the Parent, notice of such issuance or change;

(i) promptly following a request therefor, any documentation or other information that a Lender reasonably requests in order to comply with its ongoing obligations under applicable “know your customer” and anti-money laundering rules and regulations, including the Patriot Act; and

(j) from time to time, such additional information regarding the financial position or business of the Parent and its Subsidiaries as the Administrative Agent, at the request of any Lender, may reasonably request.

Documents required to be delivered pursuant to Section 6.01(a) , (b) , (e) or (f) (to the extent any such documents are included in materials otherwise filed with the SEC) may be delivered electronically and if so delivered, shall be deemed to have been delivered on the date (i) (A) on which the Parent posts such documents, or provides a link thereto on the Parent’s website on the Internet at the website address listed on Schedule   10.02 ; or (B) on which such documents are posted on the Parent’s or Borrower’s behalf on IntraLinks/IntraAgency or another relevant website, if any, to which each Lender and the Administrative Agent have access (whether a commercial, third-party website or whether sponsored by the Administrative Agent), and (ii) on which the Borrower notifies (which may be by facsimile or electronic mail) the Administrative Agent and each Lender of the posting of any such documents; provided that the Borrower shall deliver paper copies or soft copies (by electronic mail) of such documents to the Administrative Agent or any Lender that requests the Borrower to deliver such paper copies or soft copies. Information required to be delivered pursuant to this Section 6.01 may also be delivered by facsimile or electronic mail pursuant to procedures approved by the Administrative Agent. Except for Compliance Certificates required by Section   6.01(c) , the Administrative Agent shall have no obligation to maintain copies of the documents referred to above, and in any event shall have no responsibility to monitor compliance by the Borrower with any request for delivery of such documents, and each Lender shall be solely responsible for requesting delivery to it or maintaining its copies of such documents.

 

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The Parent and the Borrower hereby acknowledge that (a) the Administrative Agent and/or the Arrangers will make available to the Lenders and the L/C Issuers materials and/or information provided by or on behalf of the Borrower or the Parent hereunder (collectively, “ Materials ”) by posting the Materials on IntraLinks or another similar electronic system (the “ Platform ”) and (b) certain of the Lenders may be “public-side” Lenders (i.e., Lenders that do not wish to receive material non-public information with respect to the Parent or its securities) (each, a “ Public Lender ”). The Parent and the Borrower hereby agree that (w) all Materials that are to be made available to Public Lenders shall be clearly and conspicuously marked “PUBLIC” which, at a minimum, shall mean that the word “PUBLIC” shall appear prominently on the first page thereof; (x) by marking Materials “PUBLIC,” the Parent and the Borrower shall be deemed to have authorized the Administrative Agent, the Arrangers, the L/C Issuers and the Lenders to treat such Materials as not containing any material non-public information with respect to the Parent or its securities for purposes of United States Federal and state securities Laws ( provided , however , that to the extent such Materials constitute Information, they shall be treated as set forth in Section   10.08 ); (y) all Materials marked “PUBLIC” are permitted to be made available through a portion of the Platform designated “Public Investor;” and (z) the Administrative Agent and the Arrangers shall be entitled to treat any Materials that are not marked “PUBLIC” as being suitable only for posting on a portion of the Platform not designated “Public Investor.”

6.02 Payment of Taxes and Obligations . Each Loan Party will, and will cause each of its respective Subsidiaries to, pay or discharge its material obligations, including material Tax liabilities, before the same shall become delinquent, except where the validity or amount thereof is being contested in good faith by appropriate proceedings, and such Loan Party or such Subsidiary has set aside on its books adequate reserves with respect thereto in accordance with GAAP.

6.03 Maintenance of Property; Insurance .

(a) Each Loan Party will keep, and will cause each of its respective Subsidiaries to keep, all material property useful and necessary in its business in good working order and condition, ordinary wear and tear excepted.

(b) Parent will, and will cause each of its respective Subsidiaries to, maintain or caused to be maintained with insurance companies that are rated (or whose reinsurers are rated) “A-VII” or better by A.M. Best Company or “BBB-” or better by Standard & Poors or an equivalent rating from another recognized rating agency, insurance with respect to their respective properties and business in at least such amounts, against at least such risks and with such risk retention as are customarily maintained, insured against or retained, as the case may be, by companies engaged in a similar business, to the extent available at the time in question on commercially reasonable terms; and will furnish to the Lenders, upon request from the Administrative Agent, information presented in reasonable detail as to the insurance so carried.

6.04 Conduct of Business and Maintenance of Existence . Each Loan Party will preserve, renew and keep in full force and effect, and will cause each of its respective Subsidiaries to preserve, renew and keep in full force and effect their respective legal existence and good standing under the Laws of the jurisdiction of its organization and their respective rights, privileges and franchises necessary or desirable in the normal conduct of business; provided that nothing in this Section 6.04 shall prohibit a transaction permitted pursuant to Section 7.05 .

6.05 Compliance with Laws . Each of the Loan Parties will comply, and cause each of its respective Subsidiaries to comply, in all material respects with all applicable material Laws and requirements of Governmental Authorities (including, without limitation, Environmental Laws, the Patriot Act and ERISA and the rules and regulations thereunder) except where the necessity or fact of compliance therewith is being contested in good faith by appropriate proceedings or could not reasonably be expected to result in a Material Adverse Effect. The Parent will maintain in effect and enforce policies and procedures designed to ensure compliance by the Parent, its Subsidiaries, and their respective directors, officers, employees and agents with Anti-Corruption Laws and applicable Sanctions (and such policies and procedures will be applicable to such directors, officers, employees and agents of Noble that serve as the directors, officers, employees and agents of the Parent and its Subsidiaries).

6.06 Inspection of Property, Books and Records . Each Loan Party will keep, and will cause its respective Subsidiaries to keep, proper books of record and account in which full, true and correct, in all material respects, entries shall be made of all dealings and transactions in relation to its business and activities to the extent

 

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required by GAAP or applicable Law; and will permit, and will cause each of its respective Subsidiaries to permit, representatives of any Lender at such Lender’s expense to visit and inspect any of their respective properties, to examine and make abstracts from any of their respective books and records, and to discuss their respective affairs, finances and accounts with their respective officers, employees and independent public accountants, all at such reasonable times and as often as may reasonably be desired; provided , however, that if an Event of Default has occurred and is continuing, any visit and inspection by a Lender shall be at the sole expense of the Borrower.

6.07 Use of Proceeds . The proceeds of the Loans made under this Agreement will be used by the Loan Parties (i) to pay fees and expenses in connection with the Transactions and (ii) for working capital, capital expenditures, Acquisitions, dividends, distributions, unit repurchases, and other lawful corporate, limited liability company or partnership purposes of the Parent and its Subsidiaries.

6.08 Governmental Approvals and Filings . Each Loan Party will, and will cause each of its respective Subsidiaries to, keep and maintain in full force and effect all action by or in respect of, or filing with, any Governmental Authority necessary in connection with (a) the execution and delivery of this Agreement, or any Note issued hereunder by the Borrower, (b) the consummation of the Transactions, (c) the performance of or compliance with the terms and conditions hereof or thereof by the Parent and its Subsidiaries, or (d) any other actions required to ensure the legality, validity, binding effect, enforceability or admissibility in evidence hereof or thereof.

6.09 Material Contracts . Each Loan Party will, and will cause each of its respective Subsidiaries to, perform and observe all the terms and provisions of, and comply with, each Material Contract to be performed or observed by it, except where the failure to do so, either individually or in the aggregate, could not reasonably be expected to have a Material Adverse Effect. Each Loan Party will, and will cause each of its Subsidiaries to, use commercially reasonable efforts to enforce its rights and remedies under the Material Contracts (other than with respect to immaterial notice and information rights the non-enforcement of which the Loan Parties and their Subsidiaries determine in good faith do not have an adverse effect on their ordinary course of business), including rights with respect to indemnities, cost reimbursements and purchase price adjustments, in a manner consistent with, and to the same extent that, it would do so in an arms’-length transaction with an unrelated third party.

6.10 Guarantee Matters .

(a) Within thirty (30) days (or such longer period as the Administrative Agent may agree in writing) after the acquisition or formation of any wholly-owned Material Subsidiary (including upon a wholly-owned non-Material Subsidiary becoming a Material Subsidiary), the Parent shall cause such Person to (i) become a Guarantor by executing and delivering to the Administrative Agent a joinder to the Guarantee Agreement and (ii) deliver to the Administrative Agent (A) documents of the types referred to in Sections 4.01(a)(iii) and (iv) and (B) favorable opinions of counsel to such Person (which, as to certain matters as agreed to by the Administrative Agent, may be internal counsel and which shall cover, among other things, the legality, validity, binding effect and enforceability of the documentation referred to in clause (i)), all in form, content and scope reasonably satisfactory to the Administrative Agent. For the avoidance of doubt, no less than wholly-owned Material Subsidiary existing on or after the Closing Date shall be required to become a Guarantor hereunder until such time as such Subsidiary becomes a wholly-owned Material Subsidiary.

(b) If any Subsidiary that is not already a Loan Party guarantees any Debt of the Borrower or the Parent, then that Subsidiary shall become a guarantor of the Obligations and shall deliver a joinder to the Guarantee Agreement to the Administrative Agent within ten (10) Business Days of the date on which it guaranteed such Debt, together with such other additional closing documents, certificates and legal opinions as shall reasonably be requested by the Administrative Agent.

(c) On and after the Guarantee Release Date, the Loan Parties shall not be required to comply with the requirements of Section 6.10(a) and each Guarantor that is a Material Subsidiary shall be automatically released from its obligations under the Guarantee Agreement; provided , that, (i) no Default or Event of Default has occurred and is continuing or would result from such release, (ii) such Guarantor is not then a guarantor of any other Debt of the Borrower or the Parent, and (iii) the Borrower shall have delivered to the Administrative Agent a certificate, executed by a Responsible Officer of the Borrower, confirming that the conditions to release set forth in this Section have been satisfied.

 

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(d) If the conditions set forth Section 6.10(b) requiring such Subsidiary to be a Guarantor no longer exist, then such Subsidiary shall be automatically released from its obligations under the Guarantee Agreement; provided , that, (i) no Default or Event of Default has occurred and is continuing or would result from such release and (ii) the Borrower shall have delivered to the Administrative Agent a certificate, executed by a Responsible Officer of the Borrower, confirming that the conditions to release set forth in this Section have been satisfied.

(e) In connection with any release pursuant to this Section, the Administrative Agent is hereby authorized to execute and deliver, and agrees to promptly execute and deliver, such documents as the Borrower shall reasonably request to evidence such release. Any execution and delivery of documents pursuant to this Section shall be without recourse to or warranty by the Administrative Agent.

6.11 Subsidiaries . With respect to each non-wholly owned direct or indirect Subsidiary of the Parent: (a) to the extent such Subsidiary is a limited partnership, 100% of the general partnership interests in such Subsidiary shall be directly owned by the Parent or a wholly-owned Subsidiary of the Parent and (ii) in all cases, the Parent or a wholly-owned Subsidiary of the Parent shall Control such Subsidiary.

ARTICLE VII

NEGATIVE COVENANTS

The Loan Parties agree and covenant that, so long as any Lender has any Commitment hereunder, any Letter of Credit remains outstanding (unless such Letter of Credit has been cash collateralized in a manner acceptable to the Administrative Agent and the applicable L/C Issuer or other arrangements with respect thereto have been made that are satisfactory to the Administrative Agent and such L/C Issuer) or any Obligation payable hereunder remains unpaid:

7.01 Liens . The Loan Parties will not, and will not permit any of their respective Subsidiaries to, directly or indirectly, create, incur, assume or suffer to exist any Lien on any asset now owned or hereafter acquired by it, except:

(a) Liens (other than Liens imposed under ERISA) for taxes, assessments or governmental charges or levies not past due for more than 60 days or which are being contested in good faith and by appropriate proceedings, if adequate reserves with respect thereto are maintained on the books of the applicable Person in accordance with GAAP;

(b) Liens of landlords (other than to secure Debt) and Liens of carriers, warehousemen, mechanics, materialmen and suppliers and other Liens imposed by law or pursuant to customary reservations or retentions of title arising in the ordinary course of business, provided that such Liens secure only amounts not past due for more than 60 days or, if delinquent, are unfiled and no other action has been taken to enforce the same or are being contested in good faith by appropriate proceedings for which adequate reserves determined in accordance with GAAP have been established;

(c) pledges or deposits in the ordinary course of business in connection with workers’ compensation, unemployment insurance and other social security legislation, other than any Lien imposed by ERISA;

(d) Liens to secure the performance of bids, trade contracts and leases (other than Debt), statutory obligations, surety and appeal bonds, performance bonds and other obligations of a like nature (other than obligations under Swap Contracts) incurred in the ordinary course of business;

(e) easements, rights-of-way, restrictions and other similar encumbrances affecting real property which do not materially detract from the value of the property subject thereto or materially interfere with the ordinary conduct of the business of the applicable Person;

 

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(f) Liens securing judgments for the payment of money (or appeal or other surety bonds relating to such judgments) not constituting an Event of Default under Section   8.01(h) ;

(g) leases or subleases granted to others not interfering in any material respect with the business of any Loan Party or any of its Subsidiaries;

(h) any interest of title of a lessor under, and Liens arising from UCC financing statements (or equivalent filings, registrations or agreements in foreign jurisdictions) relating to, leases permitted by this Agreement, including, without limitation, operating leases;

(i) normal and customary rights of setoff upon deposits of cash in favor of banks or other depository institutions;

(j) Liens of a collection bank arising under Section 4-210 of the Uniform Commercial Code on items in the course of collection;

(k) Liens of sellers of goods to the Parent and any of its Subsidiaries arising under Article 2 of the Uniform Commercial Code or similar provisions of applicable law in the ordinary course of business, covering only the goods sold and securing only the unpaid purchase price for such goods and related expenses;

(l) Liens, if any, in favor of the Administrative Agent on Cash Collateral delivered pursuant to Section   2.14(a) ;

(m) Liens created pursuant to construction, operating and maintenance agreements, transportation agreements and other similar agreements and related documents entered into in the ordinary course of business; provided that such Liens do not secure Debt;

(n) rights of first refusal entered into in the ordinary course of business;

(o) Liens consisting of any (i) rights reserved to or vested in any municipality or governmental, statutory or public authority to control or regulate any property of the Parent or any Subsidiary or to use such property, (ii) obligations or duties to any municipality or public authority with respect to any franchise, grant, license, lease or permit and the rights reserved or vested in any Governmental Authority or public utility to terminate any such franchise, grant, license, lease or permit or to condemn or expropriate any property, or (iii) zoning laws, ordinances or municipal regulations;

(p) Liens on cash margin collateral, deposits or securities required by any Person with whom the Parent or any of its Subsidiaries enters into a Swap Contract, to the extent such Swap Contracts are entered into in accordance with Section 7.13 ; provided that the aggregate value of cash and other assets subject to such Liens shall not at any time exceed $25,000,000;

(q) Liens imposed by ERISA which do not constitute an Event of Default and which are being contested in good faith by appropriate proceedings and reserves in conformity with GAAP have been provided therefor;

(r) Liens on Capital Stock of joint ventures and Persons that are not Affiliates of the Parent or its Subsidiaries (in each case only to the extent such joint ventures or Persons do not constitute Subsidiaries) securing Debt of such joint venture or Person;

(s) Liens securing Debt permitted by Section 7.09(h) ; provided that (i) such Lien shall be created within 90 days of the acquisition, repair, improvement or lease, as applicable, of the related property, (ii) such Lien shall not apply to any property of the Parent or any Subsidiary other than the property financed by such Debt and proceeds thereof, (iii) the principal amount of Debt secured thereby is not increased and (iv) the principal amount of the Debt secured by such Lien shall not exceed 100% of the cost of acquiring, repairing, improving or leasing such property;

 

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(t) any easement, exceptions or reservations in any property or assets granted or reserved for the purpose of pipelines, roads, the removal of oil, gas or other minerals, and other like purposes, or for the joint or common use of real property, facilities and equipment that are incidental to, and do not materially interfere with the ordinary conduct of the Parent’s and/or its Subsidiaries’ business;

(u) prior to the Guarantee Release Date, Liens granted by the Loan Parties not otherwise permitted by the foregoing clauses of this Section securing Debt of the Loan Parties in an aggregate principal amount not exceeding $50,000,000 at the time of creation, incurrence or assumption of such Lien; and

(v) on and after the Guarantee Release Date, Liens not otherwise permitted by the foregoing clauses of this Section securing Debt of the Loan Parties and/or their respective Subsidiaries in an aggregate principal amount not exceeding 15% of Consolidated Net Tangible Assets at the time of creation, incurrence or assumption of such Lien.

7.02 Financial Covenants .

(a) The Consolidated Leverage Ratio, as of the end of each fiscal quarter of the Parent (beginning with September 30, 2016), shall be (i) before the Consolidated Leverage Ratio Trigger Date, less than or equal to 4.00 to 1.0; provided , that, in the case of this clause (i), during a Qualified Acquisition Period, the Consolidated Leverage Ratio shall be less than or equal to 4.50 to 1.0 and (ii) on and after the Consolidated Leverage Ratio Trigger Date, less than or equal to 5.00 to 1.0; provided , that, in the case of this clause (ii), during a Qualified Acquisition Period, the Consolidated Leverage Ratio shall be less than or equal to 5.50 to 1.0.

(b) The Consolidated Interest Coverage Ratio, as of the end of each fiscal quarter of the Parent (beginning with September 30, 2016), shall not be less than 3.00 to 1.0.

7.03 Transactions with Affiliates . A Loan Party will not, and will not permit any Subsidiary to, directly or indirectly, pay any funds to or for the account of, make any investment in, lease, sell, transfer or otherwise dispose of any assets, tangible or intangible, to, or participate in, or effect, any transaction (including the amendment, restatement, supplement or other modification to, or waiver of any rights under, any Material Contract the effect of which is material or adverse to a Loan Party or any Subsidiary or their respective rights thereunder, or the entry into any new Material Contract) with, any officer, director, employee or Affiliate (other than a Loan Party) (each such Person, an “Affiliated Person”) unless any such transactions between a Loan Party or its Subsidiaries, on the one hand, and any Affiliated Person, on the other hand, shall be on an arm’s-length basis and on terms no less favorable to such Loan Party or such Subsidiary than could have been obtained from a third party who was not an Affiliated Person; provided , that the foregoing provisions of this Section shall not prohibit (a) Restricted Payments permitted pursuant to Section 7.04 , (b) a Loan Party or a Subsidiary from providing credit support for its Subsidiaries as it deems appropriate in the ordinary course of business to the extent permitted pursuant to Section 7.09 and Section 7.10 , (c) transactions that are not on an arm’s length basis or are not on terms as favorable as could have been obtained from a third party, provided that such transaction or transactions occurs within a related series of transactions, which, in the aggregate, are on an arm’s-length basis and are on terms as favorable as could have been obtained from a third party, (d) non-material transactions with Noble or its Subsidiaries, or Subsidiaries of the Parent that are not Loan Parties, that are entered into in the ordinary course of business, so long as, in each case, after giving effect thereto, no Default or Event of Default shall have occurred and be continuing, such transaction is entered into in good faith and such transaction is in the best interests of the Parent and its Subsidiaries, taken as a whole, (e) (i) Midstream Drop Down Acquisitions made pursuant to Section 7.10(e)(i) , (ii) Investments in Subsidiaries existing on the Closing Date made pursuant to Section 7.10(h) and (iii) Investments in other Subsidiaries to the extent permitted pursuant to Section 7.10 , in each case not prohibited by the Partnership Agreement so long as (A) no Default or Event of Default then exists or would result therefrom and (B) the Loan Parties are in pro forma compliance with Section 7.02 after giving effect to such transaction, (f) any corporate sharing agreements with respect to tax sharing and general overhead and administrative matters, (g) transactions approved by the conflicts committee of the General Partner in accordance with the Partnership Agreement, (h) transactions involving any employee benefit or compensation plans or related trusts of the Loan Parties or a Subsidiary, (i) the payment of reasonable compensation, fees and expenses (as determined by the applicable Loan Party) to, and indemnity provided on behalf of, the General Partner and directors, employees and officers of the General Partner, the Parent or any Subsidiary, (j) transactions pursuant to any contract in existence on the Closing

 

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Date and set forth on Schedule 7.03 (without giving effect to any amendment, waiver or modification thereto that is materially adverse to the Lenders) and (k) the IPO and all transactions contemplated by the IPO in each case occurring on or about the Closing Date.

7.04 Restricted Payments . No Loan Party will, nor will it permit its Subsidiaries to, declare or make, directly or indirectly, any Restricted Payment, or incur any obligation (contingent or otherwise) to do so, except:

(a) a Subsidiary (other than the Borrower) may declare and make Restricted Payments to the Borrower (with respect to any non-wholly owned Subsidiary, ratably to its owners in accordance with their respective ownership interests);

(b) the Parent and each Subsidiary may declare and make Restricted Payments solely in the Capital Stock of such Person and the Parent may issue common Capital Stock upon the conversion of subordinated or any other class of Capital Stock;

(c) the Parent and each Subsidiary may purchase, redeem or otherwise acquire its Capital Stock with the proceeds received from the substantially concurrent issue of new Capital Stock;

(d) the Parent may make Restricted Payments to Noble or its Subsidiaries on the Closing Date as described in the “Use of Proceeds” section in the Registration Statement; and

(e) so long as (i) no Default or Event of Default has occurred and is continuing or would result therefrom and (ii) the Parent is in pro forma compliance with Section 7.02(a) , in each case on the date of declaration thereof, the Borrower may declare and pay Restricted Payments in cash to the Parent, and the Parent may declare and pay Restricted Payments in cash to the holders of its Capital Stock to the extent not prohibited by the Partnership Agreement, in each case no later than 60 days after such date of declaration.

7.05 Mergers and Fundamental Changes . A Loan Party will not, nor will it permit any of its Subsidiaries to, (a) enter into any transaction of merger or (b) consolidate, liquidate, wind up or dissolve itself (or suffer any liquidation or dissolution); provided that: (i) a Person (including a Subsidiary of the Parent but not the Borrower or the Parent) may be merged or consolidated with or into the Parent or the Borrower so long as (A) in the case of a transaction to which the Borrower is a party, the Borrower shall be the continuing or surviving entity, (B) in the case of a transaction to which the Parent is a party, the Parent shall be the continuing or surviving entity, (C)no Default or Event of Default shall exist or be caused thereby, and (D) the Borrower remains liable for its obligations under this Agreement and all the rights and remedies hereunder remain in full force and effect, (ii) a Subsidiary of the Parent (other than the Borrower) may merge with or into another Subsidiary of the Parent or any other Person, provided that if one of such Subsidiaries is a Guarantor, the surviving entity must be a Guarantor, and (iii) any Subsidiary of the Parent (other than the Borrower) may liquidate, wind up or dissolve if the Parent determines in good faith that such liquidation or dissolution is in the best interests of the Parent and is not materially disadvantageous to the Lenders; and (iv) any Investments and Dispositions otherwise permitted by this Agreement shall be permitted.

7.06 Change in Nature of Business . The Parent shall not, nor shall it permit any Subsidiary to, directly or indirectly, engage in any material line of business other than the midstream oil and gas business or any business substantially related or incidental thereto.

7.07 Use of Proceeds . The Borrower shall not use the proceeds of any Credit Extension, whether directly or indirectly, for a purpose that entails a violation of Regulation T, U or X of the FRB. The Borrower will not request any Borrowing or Letter of Credit, and the Borrower shall not use, and shall ensure that the Parent and its Subsidiaries and its or their respective directors, officers, employees and agents shall not use, the proceeds of any Borrowing or Letter of Credit (a) in furtherance of an offer, payment, promise to pay, or authorization of the payment or giving of money, or anything else of value, to any Person in violation of any Anti-Corruption Laws, (b) for the purpose of funding, financing or facilitating any activities, business or transaction of or with any Sanctioned Person, or in any Sanctioned Country or (c) in any manner that would result in the violation of any Sanctions applicable to any party hereto.

 

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7.08 Dispositions . No Loan Party will, nor will it permit its Subsidiaries to make any Disposition except:

(a) Dispositions of inventory in the ordinary course of business;

(b) Dispositions of assets no longer used or useful in the conduct of business of a Loan Party and its Subsidiaries that are Disposed of in the ordinary course of business;

(c) Dispositions of assets solely among the Loan Parties and/or any Subsidiary; provided that if the transferor of such assets is a Loan Party, the transferee thereof must be a Loan Party;

(d) Dispositions of accounts receivable in connection with the collection or compromise thereof;

(e) (i) Dispositions of licenses, sublicenses, leases or subleases or (ii) releases of rights of first refusal or rights of first offer held by the Parent or its Subsidiaries, in each case under this clause (e) not interfering in any material respect with the business of the Parent and its Subsidiaries;

(f) Dispositions of cash or Cash Equivalents in the ordinary course of business;

(g) Dispositions in which: (i) the assets being disposed of are exchanged for replacement assets of the same or substantially similar value which are useful in the ordinary course of business of the Parent and its Subsidiaries or (ii) the net proceeds thereof are either (A) reinvested within 365 days from such Disposition in assets to be used in the ordinary course of the business of the Parent and its Subsidiaries and/or (B) used to permanently reduce the Aggregate Commitment on a dollar for dollar basis;

(h) Dispositions permitted by Sections   7.04 , 7.05 (excluding clause (iii) thereof), and 7.10 ;

(i) Dispositions resulting from any casualty or other insured damage to, or any taking under power of eminent domain or by condemnation or similar proceeding of, any property or asset of a Loan Party or any Subsidiary; and

(j) other Dispositions not exceeding in the aggregate, for all Loan Parties and their Subsidiaries, 35% of Consolidated Net Tangible Assets over the term of this Agreement, measured as of the date of each Disposition effected pursuant to this clause (j) (in each case using the financial statements most recently delivered pursuant to Section 6.01(a) or (b) ).

7.09 Debt . No Loan Party will, nor will it permit its Subsidiaries to, create, incur, assume or suffer to exist any Debt except:

(a) Debt pursuant to this Agreement;

(b) Investments permitted under Section 7.10 that would constitute Debt;

(c) Debt in an aggregate outstanding principal amount not to exceed $5,000,000 incurred in connection with Capital Leases existing as of the Closing Date and set forth on Schedule 7.09 ;

(d) Debt in the form of taxes, assessments, governmental charges or levies and claims for labor, materials and supplies to the extent that payment therefor shall not be past due;

(e) Debt of (i) a Loan Party owing to another Loan Party, (ii) a Loan Party owing to a Subsidiary that is not a Loan Party, so long as such Debt is evidenced by an intercompany note and subject to subordination terms acceptable to the Administrative Agent, to the extent permitted by Requirements of Law and not giving rise to material adverse tax consequences, and (iii) to the extent permitted by Section 7.10 , any Subsidiary that is not a Loan Party owing to a Loan Party;

 

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(f) all obligations of such Person arising under letters of credit (including standby and commercial); provided , that, prior to the Guarantee Release Date, such Debt may only be incurred by the Loan Parties;

(g) Debt of any Person that becomes a Subsidiary after the Closing Date, incurred prior to the time such Person becomes a Subsidiary, that is not created in contemplation of or in connection with such Person becoming a Subsidiary and that is not assumed or Guaranteed by any other Subsidiary; and Debt secured by a Lien on property acquired by a Subsidiary, incurred prior to the acquisition thereof by such Subsidiary, that is not created in contemplation of or in connection with such acquisition and that is not assumed or Guaranteed by any other Subsidiary; and Debt refinancing (but not increasing the principal amount thereof, except by an amount equal to amounts paid for any accrued interest, breakage, premium, fees and expenses in connection with such refinancing) the Debt described in this clause (g); provided that (i) prior to the Guarantee Release Date, (A) the Parent shall be in compliance, on a pro forma basis, with the Consolidated Leverage Ratio after giving effect to the incurrence of such Debt and any Debt then being incurred under Section 7.09(j) and (B) such Subsidiary becomes a Loan Party within thirty (30) days (or such longer period as the Administrative Agent may agree in writing) after the acquisition of such Subsidiary or such property and (ii) on and after the Guarantee Release Date, such Debt, when aggregated with all Debt then outstanding or then being incurred under Section 7.09(k) , does not exceed 15% of Consolidated Net Tangible Assets after giving effect to such Debt (measured as of the date of incurrence using the financial statements most recently delivered pursuant to Section 6.01(a) or (b) );

(h) Debt incurred in connection with Capital Leases and purchase money Debt in an aggregate outstanding principal amount not to exceed $25,000,000 at any time; provided , that, prior to the Guarantee Release Date, such Debt may only be incurred by the Loan Parties;

(i) all Guarantees otherwise permitted by this Agreement, including Guarantees of Debt permitted to be incurred under this Section; provided , that, prior to the Guarantee Release Date, such Guarantees may only be incurred by the Loan Parties;

(j) other Debt incurred by the Loan Parties; provided that after giving effect to the incurrence of such Debt and the aggregate principal amount of Debt then being incurred under Section 7.09(g)(i) , the Parent shall be in compliance, on a pro forma basis, with the Consolidated Leverage Ratio; and

(k) on and after the Guarantee Release Date, other Debt incurred by Subsidiaries that are not Loan Parties; provided that the aggregate principal amount of such Debt, when aggregated with all Debt then outstanding or then being incurred under Section 7.09(g) , does not exceed 15% of Consolidated Net Tangible Assets after giving effect to the incurrence of such Debt (measured as of the date of incurrence using the financial statements most recently delivered pursuant to Section 6.01(a) or (b) ).

7.10 Investments . No Loan Party will, nor will it permit its Subsidiaries to, make any Investments, except:

(a) Investments held by a Loan Party or such Subsidiary in the form of cash or Cash Equivalents;

(b) Investments existing as of the Closing Date and set forth on Schedule   7.10 and any Investments consisting of an extension, modification or renewal of any such Investment existing on, or made pursuant to a binding commitment existing on, the Closing Date;

(c) Investments in any Person that is a Loan Party prior to or contemporaneously with giving effect to such Investment;

(d) Investments by any Subsidiary of the Parent that is not a Loan Party in any other Subsidiary of the Parent that is not a Loan Party;

 

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(e) (i) Investments in connection with Midstream Drop Down Acquisitions, provided that (A) such acquisition shall be made for fair value (as reasonably determined by the chief financial officer, chief accounting officer or chief executive officer of the Parent) and (B) such acquisition is otherwise on terms and conditions that are fair and reasonable to the Loan Parties and their Subsidiaries (as reasonably determined by the chief financial officer, chief accounting officer or chief executive officer of the Parent), taking into account the totality of the relationship between the Parent and its Subsidiaries, on the one hand, and Noble and its Subsidiaries, on the other; and (ii) other Acquisitions of property or assets to be used (or intended to be used) primarily in an activity that would generate qualifying income within the meaning of Section 7704(d) of the Code, from sellers other than Noble and/or its Subsidiaries.

(f) Investments consisting of extensions of credit in the nature of accounts receivable or notes receivable arising from the grant of trade credit in the ordinary course of business, and Investments received in compromise or resolution of (i) obligations of trade creditors or customers that were incurred in the ordinary course of business of the Parent or its Subsidiaries, including pursuant to any plan of reorganization or similar arrangement upon the bankruptcy or insolvency of any trade creditor or customer or (ii) litigation, arbitration or other disputes;

(g) Investments in connection with cash margin collateral, deposits or securities permitted under Section 7.01(p) ;

(h) Investments after the Closing Date by any Loan Party in any Subsidiary existing on the Closing Date; provided that such Investments shall otherwise comply with Section   7.03 ; and

(i) other Investments in an aggregate amount not to exceed, at any one time outstanding, an amount equal to the greater of $15,000,000 and 3% of Consolidated Net Tangible Assets.

Notwithstanding the foregoing, upon the Parent or the Borrower receiving an Investment Grade Rating from any one of S&P or Moody’s, the Loan Parties shall not be required to comply with the restrictions set forth in this Section   7.10 .

7.11 Changes in Fiscal Year; Organization Documents . The Loan Parties will not, and will not permit any of their Subsidiaries to, (a) change the fiscal year of the Parent and its Subsidiaries, or (b) amend, modify or supplement any of the Loan Party’s or their Subsidiaries’ Organization Documents unless, in each case, such action could not reasonably be expected to result in a Material Adverse Effect.

7.12 Subsidiaries . The Loan Parties will not, and will not permit any Subsidiary to:

(a) Dispose of any Capital Stock in any Subsidiary except in compliance with Section   7.08 ; provided no Loan Party will Dispose of less than 100% of the Capital Stock that it directly or indirectly owns in any Guarantor and the Parent may not Dispose of the Capital Stock in the Borrower;

(b) Dispose of any Capital Stock in any wholly-owned Subsidiary that is the general partner of a less than wholly-owned Subsidiary, or otherwise transfer or permit any Person which is not a Subsidiary of the Parent to be the general partner of any Subsidiary, except in connection with a Disposition of 100% of the Capital Stock that it directly or indirectly owns in any Subsidiary that is permitted pursuant to Section   7.08 and Section   7.12(a) ; or

(c) create, incur, assume or suffer to exist any contract, agreement or understanding which prohibits or restricts any Subsidiary from paying dividends or making distributions to any Loan Party, except:

(i) this Agreement or the Loan Documents;

(ii) restrictions binding on a Subsidiary at the time such Subsidiary first becomes a Subsidiary of the Borrower, so long as at the time of formation such Subsidiary was not owned by Noble and such restrictions were not created under contracts or agreements entered into in contemplation of such Person becoming a Subsidiary of the Borrower.

 

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(iii) restrictions imposed by Law;

(iv) agreements existing as of the Closing Date and set forth on Schedule   7.12;

(v) restrictions existing in agreements governing Debt permitted by this Agreement, provided that such restrictions, taken as a whole, are no more restrictive than the restrictions hereunder;

(vi) customary restrictions and conditions contained in purchase, merger or sale agreements relating to the Capital Stock or assets of a Subsidiary pending such transaction, provided such restrictions and conditions apply only to the Subsidiary that is subject to such transaction and such transaction is permitted by this Agreement; and

(vii) restrictions contained in, or existing by reason of, any agreement or instrument relating to any Subsidiary at the time such Subsidiary was merged or consolidated with or into, or acquired by, the Parent or a Subsidiary or became a Subsidiary and not created in contemplation thereof.

7.13 Swap Contracts . The Parent will not, and will not permit any Subsidiary to, enter into any Swap Contracts, other than Swap Contracts that are otherwise entered into not for speculative purposes, in respect of changes in interest rates, commodity prices or foreign exchange rates.

ARTICLE VIII

EVENTS OF DEFAULT AND REMEDIES

8.01 Events of Default . Any of the following events shall constitute an “ Event of Default ”:

(a) Non-Payment . Any Loan Party fails to pay (i) when and as required to be paid herein, any amount of principal of any Loan or any L/C Obligation, or (ii) within five days after the same becomes due, any interest on any Loan or on any L/C Obligation, or any facility or other fee due hereunder, or any other amount payable hereunder or under any other Loan Document; or

(b) Specific Covenants . Any Loan Party or any Subsidiary fails to perform or observe any term, covenant or agreement contained in any of Sections 6.01(d) , 6.04 (with respect to the Parent’s and the Borrower’s existence), 6.07 , 6.08 , 6.10 , 6.11 or Article VII ; or

(c) Other Defaults . Any Loan Party or any Subsidiary fails to perform or observe any other covenant or agreement (not specified in Section 8.01(a) or (b) above) contained in any Loan Document on its part to be performed or observed and such failure continues for 30 days after the earlier of (i) the date notice of such failure is given by the Administrative Agent to the Borrower or (ii) the date on which such failure first became known to a Responsible Officer of the General Partner or the Borrower; or

(d) Representations and Warranties . Any representation, warranty, certification or statement of fact made or deemed made by or on behalf of any Loan Party, in this Agreement or in any other Loan Document, or in any document delivered in connection herewith or therewith shall be incorrect or misleading in any material respect (except to the extent qualified by materiality or Material Adverse Effect, in which case they shall be true and correct in all respects) when made or deemed made; or

(e) Cross Default . (i) the Parent or any of its Subsidiaries (A) fails to make any payment when due (whether by scheduled maturity, required prepayment, acceleration, demand, or otherwise) in respect of any Material Debt, or (B) fails to observe or perform any other agreement or condition relating to any Material Debt or contained in any instrument or agreement evidencing, securing or relating thereto, or any other event occurs, the effect of which default or other event is to cause, or to permit the holder or holders of such Material Debt to cause, the maturity of such Material Debt to be accelerated or to cause such Material Debt to be repurchased, prepaid,

 

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defeased or redeemed (automatically or otherwise), or an offer to repurchase, prepay, defease or redeem such Debt to be made, prior to its stated maturity or (ii) there occurs under any Swap Contract an Early Termination Date (as defined in such Swap Contract) resulting from (A) any event of default under such Swap Contract as to which the Parent or any Subsidiary is the Defaulting Party (as defined in such Swap Contract) or (B) any Termination Event (as so defined) under such Swap Contract as to which the Parent or any Subsidiary is an Affected Party (as so defined) and, in either event, the Swap Termination Value owed by the Parent or such Subsidiary as a result thereof is greater than the Threshold Amount; or

(f) Insolvency Proceedings, Etc.  Any Loan Party or any Subsidiary institutes or consents to the institution of any proceeding under any Debtor Relief Law, or makes an assignment for the benefit of creditors; or applies for or consents to the appointment of any receiver, trustee, custodian, conservator, liquidator, rehabilitator or similar officer for it or for all or any material part of its property; or any receiver, trustee, custodian, conservator, liquidator, rehabilitator or similar officer is appointed without the application or consent of such Person and the appointment continues undischarged or unstayed for 60 calendar days; or any proceeding under any Debtor Relief Law relating to any such Person or to all or any material part of its property is instituted without the consent of such Person and continues undismissed or unstayed for 60 calendar days, or an order for relief is entered in any such proceeding; or

(g) Inability to Pay Debts; Attachment . (i) Any Loan Party or any Subsidiary admits in writing its inability or fails generally to pay its debts as they become due, or (ii) any writ or warrant of attachment or execution or similar process is issued or levied against all or any material part of the property of any such Person and is not released, vacated or fully bonded within 30 days after its issue or levy; or

(h) Judgments . There is entered against any Loan Party or any Subsidiary final judgments or orders for the payment of money in an aggregate amount exceeding the Threshold Amount (to the extent not covered by independent third-party insurance as to which the insurer does not dispute coverage), and (A) enforcement proceedings are commenced by any creditor upon such judgment or order or (B) there is a period of 30 consecutive days during which a stay of enforcement of such judgment, by reason of a pending appeal or otherwise, is not in effect; or

(i) ERISA . (i) Any member of the ERISA Group shall fail to pay when due an amount or amounts aggregating in excess of the Threshold Amount which it shall have become liable to pay under Title IV of ERISA; or (ii) notice of intent to terminate a Material Plan shall be filed under Title IV of ERISA by any member of the ERISA Group, any plan administrator or any combination of the foregoing; or (iii) the PBGC shall institute proceedings under Title IV of ERISA to terminate, to impose liability (other than for premiums under Section 4007 of ERISA) in respect of, or to cause a trustee to be appointed to administer, any Material Plan; or (iv) a condition shall exist by reason of which the PBGC would be entitled to obtain a decree adjudicating that any Material Plan must be terminated; or (v) there shall occur a complete or partial withdrawal from, or a default, within the meaning of Section 4219(c)(5) of ERISA, with respect to, one or more Multiemployer Plans, which, in the case of each of clauses   (ii) - (v) above, could cause one or more members of the ERISA Group to incur a current payment obligation in excess of the Threshold Amount in the aggregate; or

(j) Invalidity of Loan Documents . Any Loan Document at any time after its execution and delivery and for any reason other than as expressly permitted hereunder or satisfaction in full of all the Obligations, ceases to be in full force and effect; or any Loan Party or any other Person contests in any manner the validity or enforceability of any Loan Document; or any Loan Party denies that it has any or further liability or obligation under any Loan Document, or purports to revoke, terminate or rescind any Loan Document; or

(k) Change of Control . There occurs any Change of Control.

8.02 Remedies Upon Event of Default . If any Event of Default occurs and is continuing, the Administrative Agent shall, at the request of, or may, with the consent of the Required Lenders, take any or all of the following actions:

(a) declare the commitment of each Lender to make Loans and any obligations of any L/C Issuer to make L/C Credit Extensions to be terminated, whereupon such commitments and obligation shall be terminated;

 

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(b) declare the unpaid principal amount of all outstanding Loans, all interest accrued and unpaid thereon, and all other amounts owing or payable hereunder or under any other Loan Document with respect to the Commitments, Loans or Letters of Credit to be immediately due and payable, without presentment, demand, protest or other notice of any kind, all of which are hereby expressly waived by the Loan Parties;

(c) require that the Borrower Cash Collateralize the L/C Obligations (in an amount equal to the then Outstanding Amount thereof); and

(d) exercise on behalf of itself and the Lenders all rights and remedies available to it and the Lenders under the Loan Documents or applicable law;

provided , however , in each case, that upon the occurrence of an Event of Default under Section 8.01(f) or Section 8.01(g) , the obligation of each Lender to make Loans and any obligation of each L/C Issuer to make L/C Credit Extensions shall automatically terminate, the unpaid principal amount of all outstanding Loans and all interest and other amounts as aforesaid shall automatically become due and payable, and the obligation of the Borrower to Cash Collateralize the L/C Obligations as aforesaid shall automatically become effective, in each case without further act of the Administrative Agent or any Lender.

8.03 Application of Funds . After the exercise of remedies provided for in Section 8.02 (or after the Loans have automatically become immediately due and payable and the L/C Obligations have automatically been required to be Cash Collateralized as set forth in the proviso to Section 8.02 ), any amounts received on account of the Obligations shall be applied by the Administrative Agent in the following order:

First , to payment of that portion of the Obligations constituting fees, indemnities, expenses and other amounts (including Attorney Costs and amounts payable under Article III ) payable to the Administrative Agent in its capacity as such;

Second , to payment of that portion of the Obligations constituting fees, indemnities and other amounts (other than principal and interest) payable to the Lenders and the L/C Issuers (including Attorney Costs and amounts payable under Article III ), ratably among them in proportion to the amounts described in this clause Second payable to them;

Third , to payment of that portion of the Obligations constituting accrued and unpaid Letter of Credit fees pursuant to Section 2.03(h) and interest on the Loans, Swing Line Loans and the L/C Borrowings, ratably among the Lenders in proportion to the respective amounts described in this clause Third payable to them;

Fourth , to payment of that portion of the Obligations constituting unpaid principal of the Loans, Swing Line Loans and L/C Borrowings, ratably among the Lenders and the L/C Issuers in proportion to the respective amounts described in this clause Fourth held by them;

Fifth , to the Administrative Agent for the account of the L/C Issuers, to Cash Collateralize that portion of L/C Obligations comprised of the aggregate undrawn amount of Letters of Credit to the extent not Cash Collateralized by the Borrower pursuant to Section 2.16 ; and

Last , the balance, if any, after all of the Obligations have been indefeasibly paid in full, to the Borrower or as otherwise required by Law.

Subject to Section 2.03(c) , amounts used to Cash Collateralize the aggregate undrawn amount of Letters of Credit pursuant to clause Fifth above shall be applied to satisfy drawings under such Letters of Credit as they occur. If any amount remains on deposit as Cash Collateral after all Letters of Credit have either been fully drawn or expired, such remaining amount shall be applied to the other Obligations, if any, in the order set forth above.

 

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ARTICLE IX

ADMINISTRATIVE AGENT

9.01 Appointment and Authorization of Administrative Agent . Each of the Lenders and the L/C Issuers hereby irrevocably appoints JPM to act on its behalf as the Administrative Agent hereunder and under the other Loan Documents and authorizes the Administrative Agent to take such actions on its behalf and to exercise such powers as are delegated to the Administrative Agent by the terms hereof or thereof, together with such actions and powers as are reasonably incidental thereto. The provisions of this Article are solely for the benefit of the Administrative Agent, the Lenders and the L/C Issuers, and the Borrower shall not have rights as a third party beneficiary of any of such provisions. It is understood and agreed that the use of the term “agent” herein or in any other Loan Documents (or any other similar term) with reference to the Administrative Agent is not intended to connote any fiduciary or other implied (or express) obligations arising under agency doctrine of any applicable law. Instead such term is used as a matter of market custom, and is intended to create or reflect only an administrative relationship between contracting parties.

9.02 Rights as a Lender . The Person serving as the Administrative Agent hereunder shall have the same rights and powers in its capacity as a Lender as any other Lender and may exercise the same as though it were not the Administrative Agent and the term “Lender” or “Lenders” shall, unless otherwise expressly indicated or unless the context otherwise requires, include the Person serving as the Administrative Agent hereunder in its individual capacity. Such Person and its Affiliates may accept deposits from, lend money to, act as the financial advisor or in any other advisory capacity for and generally engage in any kind of business with the Parent, the Borrower or any Subsidiary or other Affiliate thereof as if such Person were not the Administrative Agent hereunder and without any duty to account therefor to the Lenders.

9.03 Exculpatory Provisions . The Administrative Agent shall not have any duties or obligations except those expressly set forth herein and in the other Loan Documents, and its duties hereunder shall be administrative in nature. Without limiting the generality of the foregoing, the Administrative Agent:

(a) shall not be subject to any fiduciary or other implied duties, regardless of whether a Default has occurred and is continuing;

(b) shall not have any duty to take any discretionary action or exercise any discretionary powers, except discretionary rights and powers expressly contemplated hereby or by the other Loan Documents that the Administrative Agent is required to exercise as directed in writing by the Required Lenders (or such other number or percentage of the Lenders as shall be expressly provided for herein or in the other Loan Documents), provided that the Administrative Agent shall not be required to take any action that, in its opinion or the opinion of its counsel, may expose the Administrative Agent to liability or that is contrary to any Loan Document or applicable law, including for the avoidance of doubt any action that may be in violation of the automatic stay under any Debtor Relief Law or that may affect a forfeiture, modification or termination of property of a Defaulting Lender in violation of any Debtor Relief Law; and

(c) shall not, except as expressly set forth herein and in the other Loan Documents, have any duty to disclose, and shall not be liable for the failure to disclose, any information relating to the Parent, the Borrower or any of their Affiliates that is communicated to or obtained by the Person serving as the Administrative Agent or any of its Affiliates in any capacity.

The Administrative Agent shall not be liable for any action taken or not taken by it (i) with the consent or at the request of the Required Lenders (or such other number or percentage of the Lenders as shall be necessary, or as the Administrative Agent shall believe in good faith shall be necessary, under the circumstances as provided in Sections   10.01 and 8.02 ) or (ii) in the absence of its own gross negligence or willful misconduct as determined by a court of competent jurisdiction by final and nonappealable judgment. The Administrative Agent shall be deemed not to have knowledge of any Default unless and until notice describing such Default is given to the Administrative Agent by the Borrower, a Lender or an L/C Issuer.

 

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The Administrative Agent shall not be responsible for or have any duty to ascertain or inquire into (i) any statement, warranty or representation made in or in connection with this Agreement or any other Loan Document, (ii) the contents of any certificate, report or other document delivered hereunder or thereunder or in connection herewith or therewith, (iii) the performance or observance of any of the covenants, agreements or other terms or conditions set forth herein or therein or the occurrence of any Default, (iv) the validity, enforceability, effectiveness or genuineness of this Agreement, any other Loan Document or any other agreement, instrument or document or (v) the satisfaction of any condition set forth in Article IV or elsewhere herein, other than to confirm receipt of items expressly required to be delivered to the Administrative Agent.

9.04 Reliance by Administrative Agent . The Administrative Agent shall be entitled to rely upon, and shall not incur any liability for relying upon, any notice, request, certificate, consent, statement, instrument, document or other writing (including any electronic message, Internet or intranet website posting or other distribution) believed by it to be genuine and to have been signed, sent or otherwise authenticated by the proper Person. The Administrative Agent also may rely upon any statement made to it orally or by telephone and believed by it to have been made by the proper Person, and shall not incur any liability for relying thereon. In determining compliance with any condition hereunder to the making of a Loan, or the issuance of a Letter of Credit, that by its terms must be fulfilled to the satisfaction of a Lender or an L/C Issuer, the Administrative Agent may presume that such condition is satisfactory to such Lender or such L/C Issuer unless the Administrative Agent shall have received notice to the contrary from such Lender or such L/C Issuer prior to the making of such Loan or the issuance of such Letter of Credit. The Administrative Agent shall be entitled to rely on legal counsel (who may be counsel for the Parent), independent accountants and other experts selected by it, and shall not be liable for any action taken or not taken by it in accordance with the advice of any such counsel, accountants or experts.

9.05 Indemnification of Administrative Agent and L/C Issuers . Whether or not the transactions contemplated hereby are consummated, (a) the Lenders shall severally indemnify upon demand the Administrative Agent and each Agent-Related Person related to the Administrative Agent and (b) the Lenders shall severally indemnify upon demand each L/C Issuer and each L/C Issuer Related Person related to such L/C Issuer (in each case, to the extent not reimbursed by or on behalf of the Borrower and without limiting the obligation of the Borrower to do so), pro rata (determined as of the time at which such indemnification is sought), and hold harmless each Agent-Related Person and each L/C Issuer Related Person from and against any and all Indemnified Liabilities incurred by it, provided that such unreimbursed Indemnified Liabilities were incurred by or asserted against the Administrative Agent or such L/C Issuer in each case in its capacity as such or against any Agent-Related Persons or L/C Issuer Related Persons acting for the Administrative Agent or such L/C Issuer in connection with such capacity; provided, however, that no Lender shall be liable for the payment to any Agent-Related Person or any L/C Issuer Related Person of any portion of such Indemnified Liabilities to the extent determined in a final, nonappealable judgment by a court of competent jurisdiction to have resulted from such Agent-Related Person’s or such L/C Issuer Related Person’s own gross negligence or willful misconduct; and provided, further, that no action taken in accordance with the directions of the Required Lenders shall be deemed to constitute gross negligence or willful misconduct for purposes of this Section. Without limitation of the foregoing, each Lender shall severally reimburse the Administrative Agent upon demand for its ratable share of any costs or out-of-pocket expenses (including Attorney Costs) incurred by the Administrative Agent in connection with the preparation, execution, delivery, administration, modification, amendment or enforcement (whether through negotiations, legal proceedings or otherwise) of, or legal advice in respect of rights or responsibilities under, this Agreement, any other Loan Document, or any document contemplated by or referred to herein, to the extent that the Administrative Agent is not reimbursed for such expenses by or on behalf of the Borrower. The obligations of the Lenders in this Section are subject to the provisions of Section 2.12(e) and shall survive termination of the Aggregate Commitment, the payment of all other Obligations and the resignation of the Administrative Agent.

9.06 Delegation of Duties . The Administrative Agent may perform any and all of its duties and exercise its rights and powers hereunder or under any other Loan Document by or through any one or more sub agents appointed by the Administrative Agent. The Administrative Agent and any such sub agent may perform any and all of its duties and exercise its rights and powers by or through their respective Related Parties. The exculpatory provisions of this Article shall apply to any such sub agent and to the Related Parties of the

 

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Administrative Agent and any such sub agent, and shall apply to their respective activities in connection with the syndication of the credit facilities provided for herein as well as activities as Administrative Agent. The Administrative Agent shall not be responsible for the negligence or misconduct of any sub-agents except to the extent that a court of competent jurisdiction determines in a final and nonappealable judgment that the Administrative Agent acted with gross negligence or willful misconduct in the selection of such sub-agents.

9.07 Resignation of Administrative Agent . The Administrative Agent may at any time give notice of its resignation to the Lenders, the L/C Issuers and the Borrower. If the Administrative Agent becomes a Defaulting Lender, then such Administrative Agent may be removed as the Administrative Agent at the reasonable request of the Borrower and the Required Lenders. Upon receipt of any such notice of resignation or removal, the Required Lenders shall have the right, in consultation with the Borrower (so long as no Event of Default exists), to appoint a successor, which shall be a bank with an office in the United States, or an Affiliate of any such bank with an office in the United States. If, in the case of resignation, no such successor shall have been so appointed by the Required Lenders and shall have accepted such appointment within 30 days after the retiring Administrative Agent gives notice of its resignation, then the retiring Administrative Agent may on behalf of the Lenders and the L/C Issuers, appoint a successor Administrative Agent meeting the qualifications set forth above; provided that if the Administrative Agent shall notify the Borrower and the Lenders that no qualifying Person has accepted such appointment, then such resignation shall nonetheless become effective in accordance with such notice and (1) the retiring Administrative Agent shall be discharged from its duties and obligations hereunder and under the other Loan Documents and (2) all payments, communications and determinations provided to be made by, to or through the Administrative Agent shall instead be made by or to each Lender and each L/C Issuer directly, until such time as the Required Lenders appoint a successor Administrative Agent as provided for above in this Section. Upon the acceptance of a successor’s appointment as Administrative Agent hereunder, such successor shall succeed to and become vested with all of the rights, powers, privileges and duties of the retiring (or retired) Administrative Agent, and the retiring Administrative Agent shall be discharged from all of its duties and obligations hereunder or under the other Loan Documents (if not already discharged therefrom as provided above in this Section). The fees payable by the Borrower to a successor Administrative Agent shall be the same as those payable to its predecessor unless otherwise agreed between the Borrower and such successor. After the retiring Administrative Agent’s resignation hereunder and under the other Loan Documents, the provisions of this Article and Section 10.04 shall continue in effect for the benefit of such retiring Administrative Agent, its sub agents and their respective Related Parties in respect of any actions taken or omitted to be taken by any of them while the retiring Administrative Agent was acting as Administrative Agent.

Any resignation by JPM as Administrative Agent pursuant to this Section shall also constitute its resignation as an L/C Issuer and a Swing Line Lender. Upon the acceptance of a successor’s appointment as Administrative Agent hereunder, (a) such successor shall succeed to and become vested with all of the rights, powers, privileges and duties of the retiring L/C Issuer and retiring Swing Line Lender, (b) the retiring L/C Issuer and retiring Swing Line Lender shall be discharged from all of their respective duties and obligations hereunder or under the other Loan Documents, and (c) the successor L/C Issuer shall issue letters of credit in substitution for the Letters of Credit, if any, outstanding at the time of such succession or make other arrangements satisfactory to the retiring L/C Issuer to effectively assume the obligations of the retiring L/C Issuer with respect to such Letters of Credit.

9.08 Non-Reliance on Administrative Agent and Other Lenders . Each Lender and each L/C Issuer acknowledges that it has, independently and without reliance upon the Administrative Agent or any other Lender or any of their Related Parties and based on such documents and information as it has deemed appropriate, made its own credit analysis and decision to enter into this Agreement. Each Lender and each L/C Issuer also acknowledges that it will, independently and without reliance upon the Administrative Agent or any other Lender or any of their Related Parties and based on such documents and information as it shall from time to time deem appropriate, continue to make its own decisions in taking or not taking action under or based upon this Agreement, any other Loan Document or any related agreement or any document furnished hereunder or thereunder.

9.09 No Other Duties, Etc. Anything herein to the contrary notwithstanding, none of the Arrangers listed on the cover page hereof shall have any powers, duties or responsibilities under this Agreement or any of the other Loan Documents, except in its capacity, as applicable, as the Administrative Agent, a Lender or an L/C Issuer hereunder.

 

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9.10 Administrative Agent May File Proofs of Claim . In case of the pendency of any receivership, insolvency, liquidation, bankruptcy, reorganization, arrangement, adjustment, composition or other judicial proceeding relative to any Loan Party, the Administrative Agent (irrespective of whether the principal of any Loan or L/C Obligation shall then be due and payable as herein expressed or by declaration or otherwise and irrespective of whether the Administrative Agent shall have made any demand on the Borrower) shall be entitled and empowered, by intervention in such proceeding or otherwise

(a) to file and prove a claim for the whole amount of the principal and interest owing and unpaid in respect of the Loans, L/C Obligations and all other Obligations that are owing and unpaid and to file such other documents as may be necessary or advisable in order to have the claims of the Lenders, the L/C Issuers and the Administrative Agent (including any claim for the reasonable compensation, expenses, disbursements and advances of the Lenders, the L/C Issuers and the Administrative Agent and their respective agents and counsel and all other amounts due the Lenders, the L/C Issuers and the Administrative Agent under Sections 2.03(h) and (i) , 2.09 , 10.04 and 10.05 ) allowed in such judicial proceeding; and

(b) to collect and receive any monies or other property payable or deliverable on any such claims and to distribute the same;

and any custodian, receiver, assignee, trustee, liquidator, sequestrator or other similar official in any such judicial proceeding is hereby authorized by each Lender and each L/C Issuer to make such payments to the Administrative Agent and, in the event that the Administrative Agent shall consent to the making of such payments directly to the Lenders and the L/C Issuers, to pay to the Administrative Agent any amount due for the reasonable compensation, expenses, disbursements and advances of the Administrative Agent and its agents and counsel, and any other amounts due the Administrative Agent under Sections 2.09 , 10.04 and 10.05 .

Nothing contained herein shall be deemed to authorize the Administrative Agent to authorize or consent to or accept or adopt on behalf of any Lender or any L/C Issuer any plan of reorganization, arrangement, adjustment or composition affecting the Obligations or the rights of any Lender or to authorize the Administrative Agent to vote in respect of the claim of any Lender in any such proceeding.

ARTICLE X

MISCELLANEOUS

10.01 Amendments, Etc. No amendment or waiver of any provision of this Agreement or any other Loan Document, and no consent to any departure by any Loan Party therefrom, shall be effective unless in writing signed by the Required Lenders and the Borrower, and acknowledged by the Administrative Agent, and each such waiver or consent shall be effective only in the specific instance and for the specific purpose for which given; provided , however , that no such amendment, waiver or consent shall:

(a) extend or increase the Commitment of any Lender (or reinstate any Commitment terminated pursuant to Section 8.02 ) without the written consent of such Lender;

(b) postpone any date fixed by this Agreement or any other Loan Document for any payment of principal, interest, fees or other amounts due to the Lenders (or any of them) hereunder or under any other Loan Document without the written consent of each Lender directly affected thereby;

(c) reduce the principal of, or the rate of interest specified herein on, any Loan or L/C Borrowing, or (subject to clause (v) of the second proviso to this Section 10.01 ) any fees or other amounts payable hereunder or under any other Loan Document without the written consent of each Lender directly affected thereby; provided , however , that only the consent of the Required Lenders shall be necessary to amend the definition of “Default Rate” or to waive any obligation of the Borrower to pay interest at the Default Rate or to amend any financial term affecting principal, interest, fees or other amounts not for the express purpose of reducing such amounts;

 

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(d) change Section 2.13 or Section 8.03 in a manner that would alter the pro rata sharing of payments or order of payments required thereby without the written consent of each Lender;

(e) amend Section 2.03(a)(ii)(C) in any manner that would permit a Letter of Credit to expire after the Letter of Credit Expiration Date without the written consent of each Lender;

(f) change any provision of this Section or the definition of “Required Lenders” or any other provision hereof specifying the number or percentage of Lenders required to amend, waive or otherwise modify any rights hereunder or make any determination or grant any consent hereunder, without the written consent of each Lender; or

(g) release the Borrower, release the Parent from the Guarantee Agreement, or except in connection with (i) a release pursuant to Section 6.10 , (ii) a merger or consolidation permitted under Section 7.05 or (iii) a Disposition permitted under Section 7.08 , release all or substantially all of the Guarantors, in each case without the written consent of each Lender;

and, provided further , that (i) no amendment, waiver or consent shall, unless in writing and signed by each L/C Issuer in addition to the Lenders required above, affect the rights or duties of such L/C Issuer under this Agreement or any Letter of Credit Application relating to any Letter of Credit issued or to be issued by it; (ii) no amendment, waiver or consent shall, unless in writing and signed by each Swing Line Lender in addition to the Lenders required above, affect the rights or duties of such Swing Line Lender under this Agreement; (iii) no amendment, waiver or consent shall, unless in writing and signed by the Administrative Agent in addition to the Lenders required above, affect the rights or duties of the Administrative Agent under this Agreement or any other Loan Document; (iv) the Fee Letter may be amended, or rights or privileges thereunder waived, in a writing executed only by the parties thereto; and (v) no Defaulting Lender shall have any right to approve or disapprove any amendment, waiver or consent hereunder (and any amendment, waiver or consent which by its terms requires the consent of all Lenders or each affected Lender may be effected with the consent of the applicable Lenders other than Defaulting Lenders), except that (A) the Commitment of any Defaulting Lender may not be increased or extended, nor the Obligations owed to any Defaulting Lender reduced, without the consent of such Lender and (B) any waiver, amendment or modification requiring the consent of all Lenders or each affected Lender that by its terms affects any Defaulting Lender disproportionately adversely relative to other affected Lenders shall require the consent of such Defaulting Lender.

10.02 Notices; Effectiveness; Electronic Communication .

(a) Notices Generally . Except in the case of notices and other communications expressly permitted to be given by telephone (and except as provided in Section 10.02(b) below), all notices and other communications provided for herein shall be in writing and shall be delivered by hand or overnight courier service, mailed by certified or registered mail or sent by telecopier as follows, and all notices and other communications expressly permitted hereunder to be given by telephone shall be made to the applicable telephone number, as follows:

(i) if to the Borrower or any other Loan Party, the Administrative Agent or JPM, as an L/C Issuer or a Swing Line Lender, to the address, telecopier number, electronic mail address or telephone number specified for such Person on Schedule 10.02 ; and

(ii) if to any other Lender, any other Swing Line Lender, or any other L/C Issuer, to the address, telecopier number, electronic mail address or telephone number specified in its Administrative Questionnaire.

Notices sent by hand or overnight courier service, or mailed by certified or registered mail, shall be deemed to have been given when received; notices sent by telecopier shall be deemed to have been given when sent (except that, if not given during normal business hours for the recipient, shall be deemed to have been given at the opening of business on the next business day for the recipient). Notices delivered through electronic communications to the extent provided in Section 10.02(b) below, shall be effective as provided in such Section   10.02(b) .

 

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(b) Electronic Communications . Notices and other communications to the Lenders and the L/C Issuers hereunder may be delivered or furnished by electronic communication (including e-mail and Internet or intranet websites) pursuant to procedures approved by the Administrative Agent, provided that the foregoing shall not apply to notices to any Lender or any L/C Issuer pursuant to Article II if such Lender or such L/C Issuer, as applicable, has notified the Administrative Agent that it is incapable of receiving notices under such Article by electronic communication. The Administrative Agent or the Borrower may, in its discretion, agree to accept notices and other communications to it hereunder by electronic communications pursuant to procedures approved by it, provided that approval of such procedures may be limited to particular notices or communications.

Unless the Administrative Agent otherwise prescribes, (i) notices and other communications sent to an e-mail address shall be deemed received upon the sender’s receipt of an acknowledgement from the intended recipient (such as by the “return receipt requested” function, as available, return e-mail or other written acknowledgement), provided that if such notice or other communication is not sent during the normal business hours of the recipient, such notice or communication shall be deemed to have been sent at the opening of business on the next business day for the recipient, and (ii) notices or communications posted to an Internet or intranet website shall be deemed received upon the deemed receipt by the intended recipient at its e-mail address as described in the foregoing clause   (i) of notification that such notice or communication is available and identifying the website address therefor.

(c) The Platform . THE PLATFORM IS PROVIDED “AS IS” AND “AS AVAILABLE.” THE AGENT/ARRANGER PARTIES (AS DEFINED BELOW) DO NOT WARRANT THE ACCURACY OR COMPLETENESS OF THE MATERIALS OR THE ADEQUACY OF THE PLATFORM, AND EXPRESSLY DISCLAIM LIABILITY FOR ERRORS IN OR OMISSIONS FROM THE MATERIALS. NO WARRANTY OF ANY KIND, EXPRESS, IMPLIED OR STATUTORY, INCLUDING ANY WARRANTY OF MERCHANTABILITY, FITNESS FOR A PARTICULAR PURPOSE, NON-INFRINGEMENT OF THIRD PARTY RIGHTS OR FREEDOM FROM VIRUSES OR OTHER CODE DEFECTS, IS MADE BY ANY AGENT/ARRANGER PARTY IN CONNECTION WITH THE MATERIALS OR THE PLATFORM. In no event shall the Administrative Agent, the Arrangers or any of their Related Parties (collectively, the “ Agent/Arranger Parties ”) have any liability to any Loan Party, any Lender, any L/C Issuer or any other Person for losses, claims, damages, liabilities or expenses of any kind (whether in tort, contract or otherwise) arising out of the Parent’s, Borrower’s or the Administrative Agent’s transmission of Materials through the Internet, except to the extent that such losses, claims, damages, liabilities or expenses are determined by a court of competent jurisdiction by a final and nonappealable judgment to have resulted from the gross negligence or willful misconduct of such Agent/Arranger Party; provided , however , that in no event shall any Agent/Arranger Party have any liability to any Loan Party, any Lender, any L/C Issuer or any other Person for indirect, special, incidental, consequential or punitive damages (as opposed to direct or actual damages).

(d) Change of Address, Etc . Each of the Borrower, the Administrative Agent, the L/C Issuers and the Swing Line Lenders may change its address, telecopier or telephone number for notices and other communications hereunder by notice to the other parties hereto. Each other Lender may change its address, telecopier or telephone number for notices and other communications hereunder by notice to the Borrower, the Administrative Agent, the L/C Issuers and the Swing Line Lenders. In addition, each Lender agrees to notify the Administrative Agent from time to time to ensure that the Administrative Agent has on record (i) an effective address, contact name, telephone number, telecopier number and electronic mail address to which notices and other communications may be sent and (ii) accurate wire instructions for such Lender.

(e) Reliance by Administrative Agent, L/C Issuers and Lenders . The Administrative Agent, the L/C Issuers and the Lenders shall be entitled to rely and act upon any notices (including telephonic Swing Line Loan Notices) purportedly given by or on behalf of the Borrower even if (i) such notices were not made in a manner specified herein, were incomplete or were not preceded or followed by any other form of notice specified herein, or (ii) the terms thereof, as understood by the recipient, varied from any confirmation thereof. The Borrower shall indemnify the Administrative Agent, each L/C Issuer, each Lender and the Related Parties of each of them from all losses, costs, expenses and liabilities resulting from the reliance by such Person on each notice purportedly given by or on behalf of the Borrower. All telephonic notices to and other telephonic communications with the Administrative Agent may be recorded by the Administrative Agent, and each of the parties hereto hereby consents to such recording.

 

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10.03 No Waiver; Cumulative Remedies . No failure by any Lender or the Administrative Agent to exercise, and no delay by any such Person in exercising, any right, remedy, power or privilege hereunder shall operate as a waiver thereof; nor shall any single or partial exercise of any right, remedy, power or privilege hereunder preclude any other or further exercise thereof or the exercise of any other right, remedy, power or privilege. The rights, remedies, powers and privileges herein provided are cumulative and not exclusive of any rights, remedies, powers and privileges provided by law.

10.04 Attorney Costs, Expenses and Taxes . The Borrower agrees (a) to pay or reimburse the Administrative Agent for all reasonable out-of-pocket costs and expenses incurred in connection with the development, preparation, negotiation and execution of this Agreement and the other Loan Documents and any amendment, waiver, consent or other modification of the provisions hereof and thereof (whether or not the transactions contemplated hereby or thereby are consummated), and the consummation and administration of the transactions contemplated hereby and thereby, including all Attorney Costs (but limited to one primary outside counsel for the Administrative Agent and the Lenders, and to the extent necessary, one local counsel in each relevant jurisdiction for the Administrative Agent and the Lenders) and (b) to pay or reimburse the Administrative Agent and each Lender for all out-of-pocket costs and expenses incurred in connection with the enforcement, attempted enforcement, or preservation of any rights or remedies under this Agreement or the other Loan Documents (including all such costs and expenses incurred during any “workout” or restructuring in respect of the Obligations and during any legal proceeding, including any proceeding under any Debtor Relief Law), including all Attorney Costs (but limited to one primary outside counsel for the Administrative Agent and the Lenders, and to the extent necessary, (i) one local counsel in each relevant jurisdiction for the Administrative Agent and the Lenders and (ii) one counsel for each group of similarly situated Persons in the case of an actual or asserted conflict of interest among the Administrative Agent and the Lenders). The foregoing costs and expenses shall include all search, filing, recording, title insurance and appraisal charges and fees and Other Taxes related thereto, and other reasonable out-of-pocket expenses incurred by the Administrative Agent and the cost of independent public accountants and other outside experts retained by the Administrative Agent or any Lender. All amounts due under this Section 10.04 shall be payable within ten Business Days after demand therefor. The agreements in this Section shall survive the termination of the Aggregate Commitment and repayment of all other Obligations.

10.05 Indemnification; Damage Waiver .

(a) Indemnification by the Loan Parties . Whether or not the transactions contemplated hereby are consummated, the Loan Parties shall indemnify and hold harmless each Agent-Related Person, each L/C Issuer Related Person, each Lender and their respective Affiliates, and the directors, officers, employees, counsel, agents and attorneys-in-fact of each of the foregoing (collectively the “ Indemnitees ”) from and against any and all liabilities, obligations, losses, damages, penalties, claims, demands, actions, judgments, suits, costs, expenses and disbursements (including Attorney Costs but limited to one primary outside counsel for the Indemnitees, and to the extent necessary, (x) one local counsel in each relevant jurisdiction for the Indemnitees and (y) one counsel for each group of similarly situated Persons in the case of an actual or asserted conflict of interest among the Administrative Agent and the Lenders) of any kind or nature whatsoever which may at any time be imposed on, incurred by or asserted against any such Indemnitee in any way relating to or arising out of or in connection with (i) the execution, delivery, enforcement, performance or administration of any Loan Document or any other agreement, letter or instrument delivered in connection with the transactions contemplated thereby or the consummation of the transactions contemplated thereby, (ii) any Commitment, Loan or Letter of Credit or the use or proposed use of the proceeds therefrom (including any refusal by any L/C Issuer to honor a demand for payment under a Letter of Credit if the documents presented in connection with such demand do not strictly comply with the terms of such Letter of Credit), (iii) any actual or alleged presence or release of Hazardous Substances on or from any property currently or formerly owned or operated by a Loan Party or any Subsidiary of a Loan Party, or any Environmental Liability related in any way to a Loan Party or any Subsidiary of a Loan Party, or (iv) any actual or prospective claim, litigation, investigation or proceeding relating to any of the foregoing, in each case whether based on contract, tort or any other theory (including any investigation of, preparation for, or defense of any pending or threatened claim, investigation, litigation or proceeding) and regardless of whether any Indemnitee is a party thereto and regardless of whether brought by the Borrower or any third party (all the foregoing, collectively, the “ Indemnified Liabilities ”), in all cases, whether or not caused by or arising, in whole or in part, out of the negligence of the Indemnitee; provided that such indemnity shall not, as to any Indemnitee, be available to the extent that such liabilities, obligations, losses, damages, penalties, claims, demands, actions, judgments, suits, costs, expenses or disbursements are determined by

 

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a court of competent jurisdiction by final and nonappealable judgment to have resulted from (x) the gross negligence or willful misconduct of such Indemnitee, (y) material breach in bad faith of such Indemnitee’s obligations under the Loan Documents or (z) a dispute solely among Indemnitees so long as such dispute does not involve, or result from, (I) an action or inaction by any Loan Party or any Affiliate of a Loan Party or (II) a dispute against the Administrative Agent or any Arranger in its capacity as such. No Indemnitee shall be liable for any damages arising from the use by others of any information or other materials obtained through IntraLinks or other similar information transmission systems in connection with this Agreement. All amounts due under this Section 10.05 shall be payable within ten Business Days after demand therefore. The agreements in this Section shall survive the resignation of the Administrative Agent, the replacement of any Lender, the termination of the Aggregate Commitment and the repayment, satisfaction or discharge of all the other Obligations. Without limiting the provisions of Section 3.01 , this Section 10.05(a) shall not apply with respect to Taxes other than Taxes that represent losses, claims, damages, etc. arising from any non-Tax claim.

(b) Waiver of Consequential Damages, Etc . Without limiting the Loan Parties’ indemnification obligations under Section 10.05(a) , to the fullest extent permitted by applicable law, no party hereto shall assert, and each hereby waives, any claim against any other party hereto, on any theory of liability, for special, indirect, consequential or punitive damages (as opposed to direct or actual damages) arising out of, in connection with, or as a result of, this Agreement, any other Loan Document or any agreement or instrument entered into or delivered pursuant hereto, the transactions contemplated hereby or thereby, any Loan or Letter of Credit or the use of the proceeds thereof. No Indemnitee referred to in Section 10.05(a) above shall be liable for any damages arising from the use by unintended recipients of any information or other materials distributed to such unintended recipients by such Indemnitee through telecommunications, electronic or other information transmission systems in connection with this Agreement or the other Loan Documents or the transactions contemplated hereby or thereby other than for direct or actual damages resulting from the gross negligence or willful misconduct of such Indemnitee as determined by a final and nonappealable judgment of a court of competent jurisdiction.

10.06 Payments Set Aside . To the extent that any payment by or on behalf of any Loan Party is made to the Administrative Agent or any Lender, or the Administrative Agent or any Lender exercises its right of set-off, and such payment or the proceeds of such set-off or any part thereof is subsequently invalidated, declared to be fraudulent or preferential, set aside or required (including pursuant to any settlement entered into by the Administrative Agent or such Lender in its discretion) to be repaid to a trustee, receiver or any other party, in connection with any proceeding under any Debtor Relief Law or otherwise, then (a) to the extent of such recovery, the obligation or part thereof originally intended to be satisfied shall be revived and continued in full force and effect as if such payment had not been made or such set-off had not occurred, and (b) each Lender severally agrees to pay to the Administrative Agent upon demand its applicable share of any amount so recovered from or repaid by the Administrative Agent, plus interest thereon from the date of such demand to the date such payment is made at a rate per annum equal to the Federal Funds Effective Rate from time to time in effect.

10.07 Successors and Assigns .

(a) The provisions of this Agreement shall be binding upon and inure to the benefit of the parties hereto and their respective successors and assigns permitted hereby, except that the Borrower may not assign or otherwise transfer any of its rights or obligations hereunder without the prior written consent of each Lender and no Lender may assign or otherwise transfer any of its rights or obligations hereunder except (i) to an assignee in accordance with the provisions of Section 10.07(b) , (ii) by way of participation in accordance with the provisions of Section   10.07(d) or (iii) by way of pledge or assignment of a security interest subject to the restrictions of Section   10.07(f) or (j) (and any other attempted assignment or transfer by any party hereto shall be null and void). Nothing in this Agreement, expressed or implied, shall be construed to confer upon any Person (other than the parties hereto, their respective successors and assigns permitted hereby, Participants to the extent provided in Section   10.07(d) and, to the extent expressly contemplated hereby, the Indemnitees) any legal or equitable right, remedy or claim under or by reason of this Agreement.

 

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(b) Any Lender may at any time assign to one or more assignees all or a portion of its rights and obligations under this Agreement (including all or a portion of its Commitment and the Loans (including for purposes of this Section 10.07(b) , participations in L/C Obligations and Swing Line Loans) at the time owing to it); provided that any such assignment shall be subject to the following conditions:

(i) Minimum Amounts .

(A) in the case of an assignment of the entire remaining amount of the assigning Lender’s Commitment and the Loans at the time owing to it or in the case of an assignment to a Lender, an Affiliate of a Lender or an Approved Fund, no minimum amount need be assigned, and

(B) in any case not described in Section   10.07(b)(i)(A) , the aggregate amount of the Commitment (which for this purpose includes Loans outstanding thereunder) or, if the Commitment is not then in effect, the principal outstanding balance of the Loans of the assigning Lender subject to each such assignment, determined as of the date the Assignment and Assumption with respect to such assignment is delivered to the Administrative Agent or, if “Trade Date” is specified in the Assignment and Assumption, as of the Trade Date, shall not be less than $5,000,000 unless each of the Administrative Agent and, so long as no Default or Event of Default has occurred and is continuing, the Borrower otherwise consents (each such consent not to be unreasonably withheld or delayed); provided , however , that concurrent assignments to members of an Assignee Group and concurrent assignments from members of an Assignee Group to a single assignee (or to an assignee and members of its Assignee Group) will be treated as a single assignment for purposes of determining whether such minimum amount has been met.

(ii) Proportionate Amounts . Each partial assignment shall be made as an assignment of a proportionate part of all the assigning Lender’s rights and obligations under this Agreement with respect to the Loans or the Commitment assigned, except that this clause (ii) shall not apply to any Swing Line Lender’s rights and obligations in respect of Swing Line Loans made by such Swing Line Lender.

(iii) Required Consents . No consent shall be required for any assignment except to the extent required by clause (b)(i)(B) and, in addition:

(A) the consent of the Borrower (such consent not to be unreasonably withheld or delayed) shall be required unless (1) an Event of Default has occurred and is continuing at the time of such assignment or (2) such assignment is, in the case of an assignment of Loans or a Commitment, to a Person that is a Lender, an Affiliate of a Lender or an Approved Fund with respect to such Lender; provided , that the Borrower shall be deemed to have consented to any such assignment unless it shall object thereto by written notice to the Administrative Agent within ten (10) Business Days after having received notice thereof;

(B) the consent of the Administrative Agent (such consent not to be unreasonably withheld or delayed) shall be required for any assignment to a Person that is not a Lender, an Affiliate of a Lender or an Approved Fund with respect to such Lender; and

(C) the consent of the L/C Issuers and the Swing Line Lenders (such consent not to be unreasonably withheld or delayed) shall be required.

(iv) Assignment and Assumption . The parties to each assignment shall execute and deliver to the Administrative Agent an Assignment and Assumption, and the assignor or assignee, as the case may be, shall deliver a processing and recordation fee in the amount of $3,500; provided , however , that the Administrative Agent may, in its sole discretion, elect to waive such processing and recordation fee in the case of any assignment. The assignee, if it is not a Lender, shall deliver to the Administrative Agent an Administrative Questionnaire.

 

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(v) No Assignment to Certain Persons . No such assignment shall be made (A) to the Parent, the Borrower or any of their Affiliates or Subsidiaries, or (B) to any Defaulting Lender or any of its Subsidiaries, or any Person who, upon becoming a Lender hereunder, would constitute any of the foregoing Persons described in this clause (B) , or (C) to a natural person.

(vi) Certain Additional Payments . In connection with any assignment of rights and obligations of any Defaulting Lender hereunder, no such assignment shall be effective unless and until, in addition to the other conditions thereto set forth herein, the parties to the assignment shall make such additional payments to the Administrative Agent in an aggregate amount sufficient, upon distribution thereof as appropriate (which may be outright payment, purchases by the assignee of participations or subparticipations, or other compensating actions, including funding, with the consent of the Borrower and the Administrative Agent, the applicable pro rata share of Loans previously requested but not funded by the Defaulting Lender, to each of which the applicable assignee and assignor hereby irrevocably consent), to (x) pay and satisfy in full all payment liabilities then owed by such Defaulting Lender to the Administrative Agent, any L/C Issuer or any Lender hereunder (and interest accrued thereon) and (y) acquire (and fund as appropriate) its full Pro Rata Share of all Loans and participations in Letters of Credit and Swing Line Loans in accordance with its Pro Rata Share. Notwithstanding the foregoing, in the event that any assignment of rights and obligations of any Defaulting Lender hereunder shall become effective under applicable Law without compliance with the provisions of this subsection, then the assignee of such interest shall be deemed to be a Defaulting Lender for all purposes of this Agreement until such compliance occurs.

(vii) Swing Line Loans . Each assignment of Swing Line Loans and/or rights and obligations as a Swing Line Lender shall be to another Swing Line Lender.

Subject to acceptance and recording thereof by the Administrative Agent pursuant to Section 10.07(c) , from and after the effective date specified in each Assignment and Assumption, the assignee thereunder shall be a party to this Agreement and, to the extent of the interest assigned by such Assignment and Assumption, have the rights and obligations of a Lender under this Agreement, and the assigning Lender thereunder shall, except to the extent otherwise specifically provided hereunder, and only to the extent of the interest assigned by such Assignment and Assumption, be released from its obligations under this Agreement (and, in the case of an Assignment and Assumption covering all of the assigning Lender’s rights and obligations under this Agreement, such Lender shall cease to be a party hereto) but shall continue to be entitled to the benefits of Sections 3.01 , 3.04 , 3.05 , 10.04 and 10.05 with respect to facts and circumstances occurring prior to the effective date of such assignment; provided, that except to the extent otherwise expressly agreed by the affected parties, no assignment by a Defaulting Lender will constitute a waiver or release of any claim of any party hereunder arising from that Lender’s having been a Defaulting Lender. Upon request, the Borrower (at its expense) shall execute and deliver a Note to the assignee Lender. Any assignment or transfer by a Lender of rights or obligations under this Agreement that does not comply with this Section 10.07(b) shall be treated for purposes of this Agreement as a sale by such Lender of a participation in such rights and obligations in accordance with Section   10.07(d) .

(c) The Administrative Agent, acting solely for this purpose as a non-fiduciary agent of the Borrower (and such agency being solely for tax purposes), shall maintain at the Administrative Agent’s Office a copy of each Assignment and Assumption delivered to it (or the equivalent thereof in electronic form) and a register for the recordation of the names and addresses of the Lenders, and the Commitments of, and principal amounts (and stated interest) of the Loans and L/C Obligations owing to, each Lender pursuant to the terms hereof from time to time (the “ Register ”). The entries in the Register shall be conclusive absent manifest error, and the Borrower, the Administrative Agent and the Lenders shall treat each Person whose name is recorded in the Register pursuant to the terms hereof as a Lender hereunder for all purposes of this Agreement, notwithstanding notice to the contrary. The Register shall be available for inspection by the Borrower and any Lender, at any reasonable time and from time to time upon reasonable prior notice.

(d) Any Lender may at any time, without the consent of, or notice to, the Borrower, the Administrative Agent, the L/C Issuers or the Swing Line Lenders, sell participations to any Person (other than a natural person or the Borrower or any of the Borrower’s Affiliates or Subsidiaries) (each, a “ Participant ”) in all or a

 

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portion of such Lender’s rights and/or obligations under this Agreement (including all or a portion of its Commitment and/or the Loans (including for purposes of this Section 10.07(d) , participations in L/C Obligations and/or Swing Line Loans) owing to it); provided that (i) such Lender’s obligations under this Agreement shall remain unchanged, (ii) such Lender shall remain solely responsible to the other parties hereto for the performance of such obligations and (iii) the Borrower, the Administrative Agent and the other Lenders shall continue to deal solely and directly with such Lender in connection with such Lender’s rights and obligations under this Agreement. Any agreement or instrument pursuant to which a Lender sells such a participation shall provide that such Lender shall retain the sole right to enforce this Agreement and to approve any amendment, modification or waiver of any provision of this Agreement; provided that such agreement or instrument may provide that such Lender will not, without the consent of the Participant, agree to any amendment, waiver or other modification described in subsections (a) through (g) of Section 10.01 that directly affects such Participant. Subject to Section 10.07(e) , the Borrower agrees that each Participant shall be entitled to the benefits of Sections 3.01 , 3.04 and 3.05 to the same extent as if it were a Lender and had acquired its interest by assignment pursuant to Section 10.07(b) . To the extent permitted by law, each Participant also shall be entitled to the benefits of Section 10.09 as though it were a Lender, provided such Participant agrees to be subject to Section   2.13 as though it were a Lender. Each Lender that sells a participation shall, acting solely for this purpose as a non-fiduciary agent of the Borrower, maintain a register on which it enters the name and address of each Participant and the principal amounts (and stated interest) of each Participant’s interest in the Loans or other obligations under the Loan Documents (the “ Participant Register ”); provided that no Lender shall have any obligation to disclose all or any portion of the Participant Register (including the identity of any Participant or any information relating to a Participant’s interest in any commitments, loans, letters of credit or its other obligations under any Loan Document) to any Person except to the extent that such disclosure is necessary to establish that such commitment, loan, letter of credit or other obligation is in registered form under Section 5f.103-1(c) of the United States Treasury Regulations. The entries in the Participant Register shall be conclusive absent manifest error, and such Lender shall treat each Person whose name is recorded in the Participant Register as the owner of such participation for all purposes of this Agreement notwithstanding any notice to the contrary. For the avoidance of doubt, the Administrative Agent (in its capacity as Administrative Agent) shall have no responsibility for maintaining a Participant Register.

(e) A Participant shall not be entitled to receive any greater payment under Section 3.01 or 3.04 than the applicable Lender would have been entitled to receive with respect to the participation sold to such Participant, except to the extent such entitlement to receive a greater payment results from a Change in Law that occurs after the Participant acquired the applicable participation. A Participant shall not be entitled to the benefits of Section 3.01 unless such Participant agrees, for the benefit of the Borrower, to comply with Section 3.01 (including Section 3.01(f) ), and be subject to Sections 3.06 and 10.16 as though it were a Lender (it being understood that the documentation required under Section 3.01(f) shall be delivered to the participating Lender).

(f) Any Lender may at any time pledge or assign a security interest in all or any portion of its rights under this Agreement (including under its Note, if any) to secure obligations of such Lender, including any pledge or assignment to secure obligations to a Federal Reserve Bank or other central bank; provided that no such pledge or assignment shall release such Lender from any of its obligations hereunder or substitute any such pledgee or assignee for such Lender as a party hereto.

(g) Electronic Execution of Assignments . The words “execution,” “signed,” “signature,” and words of like import in any Assignment and Assumption shall be deemed to include electronic signatures or the keeping of records in electronic form, each of which shall be of the same legal effect, validity or enforceability as a manually executed signature or the use of a paper-based recordkeeping system, as the case may be, to the extent and as provided for in any applicable law, including the Federal Electronic Signatures in Global and National Commerce Act, the New York State Electronic Signatures and Records Act, or any other similar state Laws based on the Uniform Electronic Transactions Act.

(h) As used herein, the following terms have the following meanings:

Eligible Assignee ” means any Person that meets the requirements to be an assignee under Section   10.07(b)(iii) and (b)(v) (subject to such consents, if any, as may be required under Section   10.07(b)(iii) ).

 

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Fund ” means any Person (other than a natural Person) that is (or will be) engaged in making, purchasing, holding or otherwise investing in commercial loans and similar extensions of credit in the ordinary course of its business.

Approved Fund ” means any Fund that is administered or managed by (a) a Lender, (b) an Affiliate of a Lender or (c) an entity or an Affiliate of an entity that administers or manages a Lender.

(i) Notwithstanding anything to the contrary contained herein, any Lender that is a Fund may create a security interest in all or any portion of the Loans owing to it and the Note, if any, held by it to the trustee for holders of obligations owed, or securities issued, by such Fund as security for such obligations or securities, provided that unless and until such trustee actually becomes a Lender in compliance with the other provisions of this Section 10.07 , (i) no such pledge shall release the pledging Lender from any of its obligations under the Loan Documents and (ii) such trustee shall not be entitled to exercise any of the rights of a Lender under the Loan Documents even though such trustee may have acquired ownership rights with respect to the pledged interest through foreclosure or otherwise.

(j) Notwithstanding anything to the contrary contained herein, if at any time any Swing Line Lender or any L/C Issuer assigns all of its Commitment and Loans pursuant to Section 10.07(b) above, such Swing Line Lender or such L/C Issuer may, upon 30 days’ notice to the Borrower and the Lenders, resign as a Swing Line Lender or an L/C Issuer. In the event of any such resignation as a Swing Line Lender or an L/C Issuer, the Borrower shall be entitled to appoint from among the Lenders (only if such Lender accepts such appointment) a successor L/C Issuer or Swing Line Lender hereunder; provided , however , that no failure by the Borrower to appoint any such successor shall affect the resignation of such L/C Issuer as an L/C Issuer or such Swing Line Lender as a Swing Line Lender, as the case may be. In connection with any such resignation, (i) such L/C Issuer shall retain all the rights and obligations of an L/C Issuer hereunder with respect to all Letters of Credit outstanding as of the effective date of its resignation as L/C Issuer and all L/C Obligations with respect thereto (including the right to require the Lenders to make Base Rate Loans or fund risk participations in Unreimbursed Amounts pursuant to Section 2.03(c) ) and (ii) such Swing Line Lender shall retain all the rights of a Swing Line Lender provided for hereunder with respect to Swing Line Loans made by it and outstanding as of the effective date of such resignation, including the right to require the Lenders to make Base Rate Loans or fund risk participations in outstanding Swing Line Loans pursuant to Section 2.04(c) , as applicable. Upon the appointment of a successor L/C Issuer and/or Swing Line Lender, (I) such successor shall succeed to and become vested with all of the rights, powers, privileges and duties of the retiring L/C Issuer or Swing Line Lender, as the case may be and (II) the successor L/C Issuer (or another L/C Issuer hereunder) shall issue letters of credit in substitution for the Letters of Credit, if any, outstanding at the time of such succession or make other arrangements satisfactory to the resigning L/C Issuer to effectively assume the obligations of the resigning L/C Issuer with respect to such Letters of Credit.

10.08 Confidentiality . Each of the Administrative Agent and the Lenders agrees to maintain the confidentiality of the Information (as defined below), except that Information may be disclosed (a) to its and its Affiliates’ directors, officers, employees and agents, including accountants, legal counsel and other advisors (it being understood that the Persons to whom such disclosure is made will be informed of the confidential nature of such Information and instructed to keep such Information confidential); (b) to the extent requested by any regulatory authority or self-regulatory authority (i.e. FINRA) purporting to have jurisdiction over it; (c) to the extent required by applicable Laws or regulations or by any subpoena or similar legal process; (d) to any other party to this Agreement; (e) in connection with the exercise of any remedies hereunder or any suit, action or proceeding relating to this Agreement or the enforcement of rights hereunder; (f) subject to an agreement containing provisions substantially the same as those of this Section, to (i) any Eligible Assignee of or Participant in, or any prospective Eligible Assignee of or Participant in, any of its rights or obligations under this Agreement or (ii) any direct or indirect contractual counterparty or prospective counterparty (or such contractual counterparty’s or prospective counterparty’s professional advisor) to any derivative transaction relating to obligations of the Borrower; (g) with the consent of the Parent or the Borrower; (h) to the extent such Information (i) becomes publicly available other than as a result of a breach of this Section or (ii) becomes available to the Administrative Agent or any Lender on a nonconfidential basis from a source other than the Parent or the Borrower; or (i) to the National Association of Insurance Commissioners or any other similar organization (including any credit insurance provider relating to the Parent and/or the Borrower). In addition, the Administrative Agent and the Lenders may disclose, after the Closing Date, the existence of this Agreement and information about this Agreement to market data collectors, similar

 

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service providers to the lending industry, and service providers to the Administrative Agent and the Lenders in connection with the administration and management of this Agreement, the other Loan Documents, the Commitments, and the Credit Extensions. For purposes of this Section, “Information” means all information received from any Loan Party or any Subsidiary relating to such Loan Party or any Subsidiary or any of their respective businesses, other than any such information that is available to the Administrative Agent, any Lender or any L/C Issuer on a nonconfidential basis prior to disclosure by a Loan Party or any Subsidiary and other than information pertaining to this Agreement routinely provided by arrangers to data service providers, including league table providers, that serve the lending industry. Any Person required to maintain the confidentiality of Information as provided in this Section shall be considered to have complied with its obligation to do so if such Person has exercised the same degree of care to maintain the confidentiality of such Information as such Person would accord to its own confidential information.

Each of the Administrative Agent, the Lenders and the L/C Issuers acknowledges that (i) the Information may include material non-public information concerning a Loan Party or a Subsidiary, as the case may be, (ii) it has developed compliance procedures regarding the use of material non-public information and (iii) it will handle such material non-public information in accordance with applicable Law, including Federal and state securities Laws.

10.09 Set-off . In addition to any rights and remedies of the Lenders provided by law, upon the occurrence and during the continuance of any Event of Default, each Lender and each of its Affiliates is authorized at any time and from time to time, without prior notice to the Borrower, any such notice being waived by the Borrower (on its own behalf and on behalf of each Loan Party) to the fullest extent permitted by law, to set off and apply any and all deposits (general or special, time or demand, provisional or final) at any time held by, and other indebtedness at any time owing by, such Lender or such Affiliate to or for the credit or the account of any Loan Party against any and all Obligations owing to such Lender hereunder or under any other Loan Document, now or hereafter existing, irrespective of whether or not the Administrative Agent or such Lender shall have made demand under this Agreement or any other Loan Document and although such Obligations may be contingent or unmatured or denominated in a currency different from that of the applicable deposit or indebtedness. Each Lender agrees promptly to notify the Borrower and the Administrative Agent after any such set-off and application made by such Lender or such Affiliate; provided , however, that the failure to give such notice shall not affect the validity of such set-off and application.

10.10 Interest Rate Limitation . Notwithstanding anything to the contrary contained in any Loan Document, the interest paid or agreed to be paid under the Loan Documents shall not exceed the maximum rate of non-usurious interest permitted by applicable Law (the “ Maximum Rate ”). If the Administrative Agent or any Lender shall receive interest in an amount that exceeds the Maximum Rate, the excess interest shall be applied to the principal of the Loans or, if it exceeds such unpaid principal, refunded to the Borrower. In determining whether the interest contracted for, charged, or received by the Administrative Agent or a Lender exceeds the Maximum Rate, such Person may, to the extent permitted by applicable Law, (a) characterize any payment that is not principal as an expense, fee, or premium rather than interest, (b) exclude voluntary prepayments and the effects thereof, and (c) amortize, prorate, allocate, and spread in equal or unequal parts the total amount of interest throughout the contemplated term of the Obligations hereunder.

10.11 Counterparts . This Agreement may be executed in one or more counterparts, each of which shall be deemed an original, but all of which together shall constitute one and the same instrument. Delivery of an executed signature page of this Agreement by facsimile or electronic mail shall be effective as delivery of manually executed counterpart hereof and shall constitute an agreement to deliver an original executed counterpart if requested.

10.12 Integration . This Agreement, together with the other Loan Documents, comprises the complete and integrated agreement of the parties on the subject matter hereof and thereof and supersedes all prior agreements, written or oral, on such subject matter. In the event of any conflict between the provisions of this Agreement and those of any other Loan Document, the provisions of this Agreement shall control; provided that the inclusion of supplemental rights or remedies in favor of the Administrative Agent or the Lenders in any other Loan Document shall not be deemed a conflict with this Agreement. Each Loan Document was drafted with the joint participation of the respective parties thereto and shall be construed neither against nor in favor of any party, but rather in accordance with the fair meaning thereof.

 

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10.13 Survival of Representations and Warranties . All representations and warranties made hereunder and in any other Loan Document or other document delivered pursuant hereto or thereto or in connection herewith or therewith shall survive the execution and delivery hereof and thereof. Such representations and warranties have been or will be relied upon by the Administrative Agent, the L/C Issuers and each Lender, regardless of any investigation made by the Administrative Agent, the L/C Issuers or any Lender or on their behalf and notwithstanding that the Administrative Agent or any Lender may have had notice or knowledge of any Default at the time of any Credit Extension, and shall continue in full force and effect as long as any Loan or any other Obligation hereunder shall remain unpaid or unsatisfied or any Letter of Credit shall remain outstanding.

10.14 Severability . If any provision of this Agreement or the other Loan Documents is held to be illegal, invalid or unenforceable, (a) the legality, validity and enforceability of the remaining provisions of this Agreement and the other Loan Documents shall not be affected or impaired thereby and (b) the parties shall endeavor in good faith negotiations to replace the illegal, invalid or unenforceable provisions with valid provisions the economic effect of which comes as close as possible to that of the illegal, invalid or unenforceable provisions. The invalidity of a provision in a particular jurisdiction shall not invalidate or render unenforceable such provision in any other jurisdiction.

10.15 Reserved .

10.16 Replacement of Lenders . If any Lender requests compensation under Section 3.04 , or if the Borrower is required to pay any Indemnified Taxes or additional amounts to any Lender or any Governmental Authority for the account of any Lender pursuant to Section 3.01 and, in each case, such Lender has declined or is unable to designate a different lending office in accordance with Section 10.16(a) , or if any Lender suspends its obligations to make, maintain or continue Eurodollar Rate Loans pursuant to Section 3.02 or any Lender is a Defaulting Lender or a Non-Consenting Lender, then the Borrower may, at its sole expense and effort, upon notice to such Lender and the Administrative Agent, require such Lender to assign and delegate, without recourse (in accordance with and subject to the restrictions contained in, and consents required by, Section 10.07 ), all of its interests, rights (other than its existing rights to payments pursuant to Section 3.04 or Section 3.01 ) and obligations under this Agreement and the related Loan Documents to an Eligible Assignee that shall assume such obligations (which assignee may be another Lender, if a Lender accepts such assignment), provided that:

(a) the Borrower shall have paid to the Administrative Agent the assignment fee (if any) specified in Section 10.07(b) ;

(b) such Lender shall have received payment of an amount equal to the outstanding principal of its Loans and participations in L/C Advances, accrued interest thereon, accrued fees and all other amounts payable to it hereunder and under the other Loan Documents (including any amounts under Section 3.05 ) from the assignee (to the extent of such outstanding principal and accrued interest and fees) or the Borrower (in the case of all other amounts);

(c) in the case of any such assignment resulting from a claim for compensation under Section   3.04 or payments required to be made pursuant to Section 3.01 , such assignment will result in a reduction in such compensation or payments thereafter;

(d) such assignment does not conflict with applicable Laws;

(e) in the case of any assignment resulting from a Lender becoming a Non-Consenting Lender, the applicable assignee shall have consented to the applicable amendment, waiver or consent; and

(f) In the event that such Lender is an L/C Issuer and any one or more Letters of Credit issued by such L/C Issuer under this Agreement remain outstanding, the Borrower shall Cash Collateralize such Letters of Credit upon terms reasonably satisfactory to such L/C Issuer to secure the Borrower’s obligations to reimburse for drawings under such Letters of Credit or make other arrangements reasonably satisfactory to such L/C Issuer with respect to such Letters of Credit including providing other credit support.

 

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A Lender shall not be required to make any such assignment or delegation if, prior thereto, as a result of a waiver by such Lender or otherwise, the circumstances entitling the Borrower to require such assignment and delegation cease to apply. Solely for purposes of effecting any assignment involving a Defaulting Lender under this Section   10.16 and to the extent permitted under applicable Laws, each Lender hereby agrees that any Assignment and Acceptance done in accordance with this Section 10.16 shall be effective against a Defaulting Lender one (1) Business Day after it has been given notice of the same, whether or not such Defaulting Lender has executed such Assignment and Acceptance, and such Defaulting Lender shall be bound thereby as fully and effectively as if such Defaulting Lender had personally executed, acknowledged and delivered the same.

10.17 Governing Law; Jurisdiction .

(a) THIS AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAW OF THE STATE OF NEW YORK.

(b) ANY LEGAL ACTION OR PROCEEDING WITH RESPECT TO THIS AGREEMENT OR ANY OTHER LOAN DOCUMENT SHALL BE BROUGHT IN THE COURTS OF THE STATE OF NEW YORK SITTING IN THE BOROUGH OF MANHATTAN OR OF THE COURTS OF THE UNITED STATES FOR THE SOUTHERN DISTRICT OF NEW YORK SITTING IN THE BOROUGH OF MANHATTAN, AND BY EXECUTION AND DELIVERY OF THIS AGREEMENT, EACH LOAN PARTY, THE ADMINISTRATIVE AGENT, EACH L/C ISSUER AND EACH LENDER CONSENTS, FOR ITSELF AND IN RESPECT OF ITS PROPERTY, TO THE EXCLUSIVE JURISDICTION OF THOSE COURTS. EACH LOAN PARTY, THE ADMINISTRATIVE AGENT, EACH L/C ISSUER AND EACH LENDER IRREVOCABLY WAIVES ANY OBJECTION, INCLUDING ANY OBJECTION TO THE LAYING OF VENUE OR BASED ON THE GROUNDS OF FORUM NON CONVENIENS, WHICH IT MAY NOW OR HEREAFTER HAVE TO THE BRINGING OF ANY ACTION OR PROCEEDING IN SUCH JURISDICTION IN RESPECT OF ANY LOAN DOCUMENT OR OTHER DOCUMENT RELATED THERETO. THE FOREGOING PROVISIONS OF THIS PARAGRAPH SHALL NOT PRECLUDE THE ADMINISTRATIVE AGENT, ANY L/C ISSUER OR ANY LENDER FROM INITIATING ANY LEGAL ACTION OR PROCEEDING IN ANY OTHER JURISDICTION IN CONNECTION WITH THE ENFORCEMENT OF ANY JUDGMENT. EACH LOAN PARTY, THE ADMINISTRATIVE AGENT AND EACH LENDER WAIVES PERSONAL SERVICE OF ANY SUMMONS, COMPLAINT OR OTHER PROCESS, WHICH MAY BE MADE BY ANY OTHER MEANS PERMITTED BY THE LAW OF SUCH STATE.

10.18 No Advisory or Fiduciary Responsibility . In connection with all aspects of each transaction contemplated hereby, the Loan Parties acknowledge and agree that: (i) the credit facility provided for hereunder and any related arranging or other services in connection therewith (including in connection with any amendment, waiver or other modification hereof or of any other Loan Document) are an arm’s-length commercial transaction between the Loan Parties and their Affiliates, on the one hand, and the Administrative Agent, the Lenders, the L/C Issuers and the Arrangers, on the other hand, and the Loan Parties are capable of evaluating and understanding and understands and accepts the terms, risks and conditions of the transactions contemplated hereby and by the other Loan Documents (including any amendment, waiver or other modification hereof or thereof); (ii) in connection with the process leading to such transaction, each of the Administrative Agent, the Lenders, the L/C Issuers and the Arrangers, is and has been acting solely as a principal and is not the financial advisor, agent or fiduciary, for any Loan Party or any of their Affiliates, stockholders, creditors or employees or any other Person; (iii) none of the Administrative Agent, any Lender, any L/C Issuer or any Arranger has assumed or will assume an advisory, agency or fiduciary responsibility in favor of the Loan Parties with respect to any of the transactions contemplated hereby or the process leading thereto, including with respect to any amendment, waiver or other modification hereof or of any other Loan Document (irrespective of whether the Administrative Agent, any Lender, any L/C Issuer or any Arranger has advised or is currently advising any Loan Party or any of their Affiliates on other matters) and none of the Administrative Agent, any Lender, any L/C Issuer or any Arranger has any obligation to any Loan Party or any of their Affiliates with respect to the transactions contemplated hereby except those obligations expressly set forth herein and in the other Loan Documents; (iv) the Administrative Agent, the Lenders, the L/C Issuers, the Arrangers and their respective Affiliates may be engaged in a broad range of transactions that involve interests that differ from those of the Loan Parties and their Affiliates, and none of the Administrative Agent, any Lender, any L/C Issuer or any Arranger has any obligation to disclose any of such interests by virtue of any advisory, agency or fiduciary relationship; and (v) the Administrative Agent, the Lenders, the L/C Issuers and the Arrangers have not provided

 

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and will not provide any legal, accounting, regulatory or tax advice with respect to any of the transactions contemplated hereby (including any amendment, waiver or other modification hereof or of any other Loan Document) and the Loan Parties have consulted their own legal, accounting, regulatory and tax advisors to the extent it has deemed appropriate. The Loan Parties hereby waive and release, to the fullest extent permitted by law, any claims that it may have against the Administrative Agent, the Lenders, the L/C Issuers and the Arrangers with respect to any breach or alleged breach of agency or fiduciary duty.

10.19 Waiver of Right to Trial by Jury . EACH PARTY TO THIS AGREEMENT HEREBY EXPRESSLY WAIVES ANY RIGHT TO TRIAL BY JURY OF ANY CLAIM, DEMAND, ACTION OR CAUSE OF ACTION ARISING UNDER ANY LOAN DOCUMENT OR IN ANY WAY CONNECTED WITH OR RELATED OR INCIDENTAL TO THE DEALINGS OF THE PARTIES HERETO OR ANY OF THEM WITH RESPECT TO ANY LOAN DOCUMENT, OR THE TRANSACTIONS RELATED THERETO, IN EACH CASE WHETHER NOW EXISTING OR HEREAFTER ARISING, AND WHETHER FOUNDED IN CONTRACT OR TORT OR OTHERWISE; AND EACH PARTY 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 ANY PARTY TO THIS AGREEMENT MAY FILE AN ORIGINAL COUNTERPART OR A COPY OF THIS SECTION WITH ANY COURT AS WRITTEN EVIDENCE OF THE CONSENT OF THE SIGNATORIES HERETO TO THE WAIVER OF THEIR RIGHT TO TRIAL BY JURY.

10.20 USA PATRIOT Act Notice . Each Lender that is subject to the Patriot Act (as hereinafter defined) and the Administrative Agent (for itself and not on behalf of any Lender) hereby notifies the Loan Parties that pursuant to the requirements of the USA Patriot Act (Title III of Pub. L. 107-56 (signed into law October 26, 2001)) (the “ Patriot Act ”), it is required to obtain, verify and record information that identifies the Loan Parties, which information includes the name and address of each Loan Party and other information that will allow such Lender or the Administrative Agent, as applicable, to identify such Loan Party in accordance with the Patriot Act.

10.21 Entire Agreement . This Agreement and the other Loan Documents represent the final agreement AMONG the parties and may not be contradicted by evidence of prior, contemporaneous, or subsequent oral agreements of the parties. There are no unwritten oral agreements among the parties.

10.22 No General Partner’s Liability for Revolving Facility . It is hereby understood and agreed that the General Partner shall have no personal liability, as general partner or otherwise, for the payment of any amount owing or to be owing hereunder or under any other Loan Document with respect to the Commitments, Loans or Letters of Credit. In furtherance of the foregoing, the Administrative Agent and the Lenders agree for themselves and their respective successors and assigns that no claim arising against the Parent, the Borrower or any of their Subsidiaries under any Loan Document with respect to the Commitments, Loans or Letters of Credit shall be asserted against the General Partner (in its individual capacity), any claim arising against the Parent, the Borrower or any of their Subsidiaries under any Loan Document with respect to the Commitments, Loans or Letters of Credit shall be made only against and shall be limited to the assets of the Parent, the Borrower or any of their Subsidiaries, and no judgment, order or execution entered in any suit, action or proceeding, whether legal or equitable, on this Agreement or any of the other Loan Documents with respect to the Commitments, Loans or Letters of Credit shall be obtained or enforced against the General Partner (in its individual capacity) or its assets for the purpose of obtaining satisfaction and payment of the Obligations with respect to the Commitments, Loans or Letters of Credit or any claims arising under this Agreement or any other Loan Document with respect to the Commitments, Loans or Letters of Credit, any right to proceed against the General Partner individually or its respective assets being hereby expressly waived by the Lenders for themselves and their respective successors and assigns.

10.23 Acknowledgement and Consent to Bail-In of EEA Financial Institutions.   Notwithstanding anything to the contrary in any Loan Document or in any other agreement, arrangement or understanding among any such parties, each party hereto acknowledges that any liability of any EEA Financial Institution arising under any Loan Document may be subject to the write-down and conversion powers of an EEA Resolution Authority and agrees and consents to, and acknowledges and agrees to be bound by:

(a) the application of any Write-Down and Conversion Powers by an EEA Resolution Authority to any such liabilities arising hereunder which may be payable to it by any party hereto that is an EEA Financial Institution; and

 

82


(b) the effects of any Bail-In Action on any such liability, including, if applicable:

(i) a reduction in full or in part or cancellation of any such liability;

(ii) a conversion of all, or a portion of, such liability into shares or other instruments of ownership in such EEA Financial Institution, its parent entity, or a bridge institution that may be issued to it or otherwise conferred on it, and that such shares or other instruments of ownership will be accepted by it in lieu of any rights with respect to any such liability under this Agreement or any other Loan Document; or

(iii) the variation of the terms of such liability in connection with the exercise of the write-down and conversion powers of any EEA Resolution Authority.

 

83


IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be duly executed as of the date first above written.

 

BORROWER:     NOBLE MIDSTREAM SERVICES, LLC , a Delaware limited liability company
    By:  

 

      Terry R. Gerhart
      Chief Executive Officer
PARENT:     NOBLE MIDSTREAM PARTNERS LP , a Delaware limited partnership
    By:   Noble Midstream GP LLC, its General Partner
    By:  

 

      Terry R. Gerhart
      Chief Executive Officer

Signature Page to Noble Midstream Services Credit Agreement

Exhibit 10.7.2

When Recorded, Mail To:

Attn: DJ Land Manager

1625 Broadway, Suite 2200

Denver, CO 80202

AMENDMENT 01

TO

THAT CERTAIN

SECOND AMENDED AND RESTATED

GAS GATHERING AGREEMENT

W ELLS R ANCH

C ONTRACT N UMBER : CRWR01-GG

This AMENDMENT 01 (this “ Amendment ”) shall be effective as among Noble Energy, Inc., a Delaware corporation (the “ Producer ”) and Colorado River DevCo LP, a Delaware limited partnership, together with its permitted successors and assigns (“ Midstream Co ”) as of September 1, 2016 (the “ Amendment Effective Time ”). This Amendment modifies that certain Second Amended and Restated Gas Gathering Agreement, effective as of March 31, 2016 (the “ Agreement ”), which has been given contract number CRWR01-GG and is comprised of (i) that certain Second Amended and Restated Agreement Terms and Conditions Relating to Gas Gathering Services (the “ Agreement Terms and Conditions ”), last updated March 31, 2016, together with (ii) that certain Second Amended and Restated Agreement Addendum 01 (the “ Agreement Addendum ”), effective as of March 31, 2016. The Agreement Terms and Conditions, the Agreement Addendum and this Amendment shall constitute one contract and shall be the Agreement of the Parties.

WHEREAS, the Parties acknowledge that the purpose of this Amendment is make certain technical modifications.

WHEREAS, the Parties agree and acknowledge that amendments to the Agreement Terms and Conditions set forth herein constitute an amendment only to the Agreement and not to any other agreement in respect of natural gas gathering services to which Producer is a party.

NOW, THEREFORE, in consideration of the foregoing recitals, which are incorporated herein and the mutual agreements in the Agreement, Midstream Co and Producer hereby agree as follows:


1. Amendments .

1.1 Section 1.1 of the Agreement (which appears in the Agreement Terms and Conditions) is hereby amended by amending and restating the following defined terms in their entirety to read as follows:

Facility Segment ” means each segment of an Individual System comprised of facilities beginning at a Receipt Point and ending at a Delivery Point. If an Individual System does not contain any such distinct segment, then the term Facility Segment shall be synonymous with Individual System.

Individual System ” means the portion of the System beginning at the Receipt Points and ending at the Delivery Points. The Individual Systems in existence on the Effective Date are more particularly described in writing between Producer and Midstream Co. Additional Individual Systems may be added to the System from time to time in satisfaction of the needs identified by Producer and evidenced in writing between Producer and Midstream Co.

1.2 Section 1.1 of the Agreement (which appears in the Agreement Terms and Conditions) is further amended by amending and restating clauses (a) and (b) of the defined term “Dedicated Production” to read as follows: “(a) Product owned by Producer or an Affiliate of Producer and produced from a Well within the Dedication Area that is operated by Producer or an Affiliate under the Control of Producer, (b)  Reserved ,”.

1.3 Section 2.3(d) of the Agreement (which appears in the Agreement Terms and Conditions) is hereby amended and restated in its entirety to read: “(d) to pool, communitize or unitize Producer’s interests with respect to Dedicated Production”.

1.4 Section 2.4(b)(iv) of the Agreement (which appears in the Agreement Terms and Conditions) is amended and restated in its entirety to read: “(iv) Reserved. ”.

1.5 Section 3.1(e) of the Agreement (which appears in the Agreement Terms and Conditions) is hereby amended by deleting the sentence that reads as follows “In the sole discretion of each Person serving as a Midstream Co under a Midstream Agreement Addendum, such Midstream Co may work with any other Midstream Co to prepare and deliver a System Plan jointly.” and inserting in place thereof the following sentence: “Midstream Co may, in its sole discretion, work with OpCo or any of OpCo’s subsidiaries to prepare and deliver a System Plan jointly with such other entity or entities.”

1.6 Section 3.2 of the Agreement (which appears in the Agreement Terms and Conditions) is hereby amended by inserting the following new clause (e)  immediately following clause (d)  of such Section 3.2 :

“(e) Substation and Interconnection Facilities . The obligations of Midstream Co hereunder to design and construct the Individual System and to perform the Services do not include the design or construction of any substation or other interconnecting facilities required to procure electricity for the Individual System. If a substation or any other interconnecting facility is required in order for Midstream Co to perform its obligations

 

Amendment 01 – Page 2

Second Amended and Restated Gas Gathering Agreement

Colorado River Gas Gathering Agreement

CRWR01-GG


hereunder, Midstream Co and Producer shall enter into a separate agreement setting forth each Party’s responsibilities in connection therewith, including an allocation of responsibility for all associated costs and expenses.”

2. Confidentiality . Pursuant to Section 17.11 of the Agreement (which appears in the Agreement Terms and Conditions), the Parties have agreed to treat the information exchanged in connection with and the provisions of the Agreement as confidential. In addition, confidential treatment has been requested with the Securities and Exchange Commission for the pricing terms of the Agreement, and the Parties agree to take appropriate measures to abide by the requirements imposed by the Securities and Exchange Commission to preserve such confidential treatment, if granted.

3. Confirmation . The provisions of the Agreement, as amended by this Amendment, shall remain in full force and effect following the effectiveness of this Amendment. No provision of the Agreement is amended or otherwise modified hereby, except as expressly stated herein.

4. No Waiver . The execution, delivery and effectiveness of this Amendment shall not operate as a waiver of any right, power or remedy of any Party to the Agreement, nor constitute a waiver of any provision of the Agreement. On and after the Amendment Effective Time, this Amendment shall for all purposes constitute a part of the Agreement.

5. Counterparts . This Amendment may be executed in any number of counterparts, and each such counterpart hereof shall be deemed to be an original instrument, but all of such counterparts shall constitute for all purposes one agreement. Any signature hereto delivered by a Party by electronic mail shall be deemed an original signature hereto.

6. Governing Law . This Amendment shall be governed by and construed in accordance with the laws of the State, excluding any conflicts of law rule or principle that might refer construction of such provisions to the laws of another jurisdiction.

(Signature Pages follow)

 

Amendment 01 – Page 3

Second Amended and Restated Gas Gathering Agreement

Colorado River Gas Gathering Agreement

CRWR01-GG


IN WITNESS WHEREOF, the Parties hereto have executed this Amendment to the Agreement in duplicate originals to be effective as of the Amendment Effective Time.

 

“Producer”

 

NOBLE ENERGY, INC.

By:  

/s/ Gary W. Willingham

 

Gary W. Willingham

 

Executive Vice President

 

STATE OF TEXAS

     )     
     )      ss.
COUNTY OF HARRIS      )     

The foregoing instrument was acknowledged before me this 29th day of August, 2016, by Gary W. Willingham as Executive Vice President of Noble Energy, Inc., a Delaware corporation.

WITNESS my hand and official seal.

My commission expires: 05/05/2018            

 

/s/ Joanne Garner
Notary Public

 

Amendment 01 – Signature Page 1

Second Amended and Restated Gas Gathering Agreement

Colorado River Gas Gathering Agreement

CRWR01-GG


“Midstream Co”

COLORADO RIVER DEVCO LP

  By:   Colorado River DevCo GP LLC
      By:   Noble Midstream Services, LLC
          By:   /s/ Terry R. Gerhart
           

Terry R. Gerhart

            Chief Executive Officer

 

STATE OF TEXAS

     )     
     )      ss.
COUNTY OF HARRIS      )     

The foregoing instrument was acknowledged before me this 25th day of August, 2016, by Terry R. Gerhart as Chief Executive Officer of Noble Midstream Services, LLC, which is the sole member of Colorado River DevCo GP LLC, which is the general partner of Colorado River DevCo LP, a Delaware limited partnership.

WITNESS my hand and official seal.

My commission expires: 05/05/2018            

 

/s/ Joanne Garner
Notary Public

 

Amendment 01 – Signature Page 2

Second Amended and Restated Gas Gathering Agreement

Colorado River Gas Gathering Agreement

CRWR01-GG

Exhibit 10.8.1.1

When Recorded, Mail To:

Attn: DJ Land Manager

1625 Broadway, Suite 2200

Denver, CO 80202

AMENDMENT 01

TO

THAT CERTAIN

SECOND AMENDED AND RESTATED

GAS GATHERING AGREEMENT

M USTANG

C ONTRACT N UMBER : GRMU03-GG

This AMENDMENT 01 (this “ Amendment ”) shall be effective as among Noble Energy, Inc., a Delaware corporation (the “ Producer ”) and Green River DevCo LP, a Delaware limited partnership, together with its permitted successors and assigns (“ Midstream Co ”) as of September 1, 2016 (the “ Amendment Effective Time ”). This Amendment modifies that certain Second Amended and Restated Gas Gathering Agreement, effective as of March 31, 2016 (the “ Agreement ”), which has been given contract number GRMU03-GG and is comprised of (i) that certain Second Amended and Restated Agreement Terms and Conditions Relating to Gas Gathering Services (the “ Agreement Terms and Conditions ”), last updated March 31, 2016, together with (ii) that certain Second Amended and Restated Agreement Addendum 03 (the “ Agreement Addendum ”), effective as of March 31, 2016. The Agreement Terms and Conditions, the Agreement Addendum and this Amendment shall constitute one contract and shall be the Agreement of the Parties.

WHEREAS, the Parties acknowledge that the purpose of this Amendment is make certain technical modifications.

WHEREAS, the Parties agree and acknowledge that amendments to the Agreement Terms and Conditions set forth herein constitute an amendment only to the Agreement and not to any other agreement in respect of natural gas gathering services to which Producer is a party.

NOW, THEREFORE, in consideration of the foregoing recitals, which are incorporated herein and the mutual agreements in the Agreement, Midstream Co and Producer hereby agree as follows:


1. Amendments .

1.1 Section 1.1 of the Agreement (which appears in the Agreement Terms and Conditions) is hereby amended by amending and restating the following defined terms in their entirety to read as follows:

Facility Segment ” means each segment of an Individual System comprised of facilities beginning at a Receipt Point and ending at a Delivery Point. If an Individual System does not contain any such distinct segment, then the term Facility Segment shall be synonymous with Individual System.

Individual System ” means the portion of the System beginning at the Receipt Points and ending at the Delivery Points. The Individual Systems in existence on the Effective Date are more particularly described in writing between Producer and Midstream Co. Additional Individual Systems may be added to the System from time to time in satisfaction of the needs identified by Producer and evidenced in writing between Producer and Midstream Co.

1.2 Section 1.1 of the Agreement (which appears in the Agreement Terms and Conditions) is further amended by amending and restating clauses (a) and (b) of the defined term “Dedicated Production” to read as follows: “(a) Product owned by Producer or an Affiliate of Producer and produced from a Well within the Dedication Area that is operated by Producer or an Affiliate under the Control of Producer, (b)  Reserved ,”.

1.3 Section 2.3(d) of the Agreement (which appears in the Agreement Terms and Conditions) is hereby amended and restated in its entirety to read: “(d) to pool, communitize or unitize Producer’s interests with respect to Dedicated Production”.

1.4 Section 2.4(b)(iv) of the Agreement (which appears in the Agreement Terms and Conditions) is amended and restated in its entirety to read: “(iv) Reserved. ”.

1.5 Section 3.1(e) of the Agreement (which appears in the Agreement Terms and Conditions) is hereby amended by deleting the sentence that reads as follows “In the sole discretion of each Person serving as a Midstream Co under a Midstream Agreement Addendum, such Midstream Co may work with any other Midstream Co to prepare and deliver a System Plan jointly.” and inserting in place thereof the following sentence: “Midstream Co may, in its sole discretion, work with OpCo or any of OpCo’s subsidiaries to prepare and deliver a System Plan jointly with such other entity or entities.”

1.6 Section 3.2 of the Agreement (which appears in the Agreement Terms and Conditions) is hereby amended by inserting the following new clause (e)  immediately following clause (d)  of such Section 3.2 :

“(e) Substation and Interconnection Facilities . The obligations of Midstream Co hereunder to design and construct the Individual System and to perform the Services do not include the design or construction of any substation or other interconnecting facilities required to procure electricity for the Individual System. If a substation or any other interconnecting facility is required in order for Midstream Co to perform its obligations

 

Amendment 01 – Page 2

Second Amended and Restated Gas Gathering Agreement

Green River Gas Gathering Agreement

GRMU03-GG


hereunder, Midstream Co and Producer shall enter into a separate agreement setting forth each Party’s responsibilities in connection therewith, including an allocation of responsibility for all associated costs and expenses.”

2. Confidentiality . Pursuant to Section 17.11 of the Agreement (which appears in the Agreement Terms and Conditions), the Parties have agreed to treat the information exchanged in connection with and the provisions of the Agreement as confidential. In addition, confidential treatment has been requested with the Securities and Exchange Commission for the pricing terms of the Agreement, and the Parties agree to take appropriate measures to abide by the requirements imposed by the Securities and Exchange Commission to preserve such confidential treatment, if granted.

3. Confirmation . The provisions of the Agreement, as amended by this Amendment, shall remain in full force and effect following the effectiveness of this Amendment. No provision of the Agreement is amended or otherwise modified hereby, except as expressly stated herein.

4. No Waiver . The execution, delivery and effectiveness of this Amendment shall not operate as a waiver of any right, power or remedy of any Party to the Agreement, nor constitute a waiver of any provision of the Agreement. On and after the Amendment Effective Time, this Amendment shall for all purposes constitute a part of the Agreement.

5. Counterparts . This Amendment may be executed in any number of counterparts, and each such counterpart hereof shall be deemed to be an original instrument, but all of such counterparts shall constitute for all purposes one agreement. Any signature hereto delivered by a Party by electronic mail shall be deemed an original signature hereto.

6. Governing Law . This Amendment shall be governed by and construed in accordance with the laws of the State, excluding any conflicts of law rule or principle that might refer construction of such provisions to the laws of another jurisdiction.

(Signature Pages follow)

 

Amendment 01 – Page 3

Second Amended and Restated Gas Gathering Agreement

Green River Gas Gathering Agreement

GRMU03-GG


IN WITNESS WHEREOF, the Parties hereto have executed this Amendment to the Agreement in duplicate originals to be effective as of the Amendment Effective Time.

 

“Producer”

 

NOBLE ENERGY, INC.

By:   /s/ Gary W. Willingham
 

Gary W. Willingham

 

Executive Vice President

 

STATE OF TEXAS

     )     
     )      ss.
COUNTY OF HARRIS      )     

The foregoing instrument was acknowledged before me this 29th day of August, 2016, by Gary W. Willingham as Executive Vice President of Noble Energy, Inc., a Delaware corporation.

WITNESS my hand and official seal.

My commission expires: 05/05/2018            

 

/s/ Joanne Garner
Notary Public

 

Amendment 01 – Signature Page 1

Second Amended and Restated Gas Gathering Agreement

Green River Gas Gathering Agreement

GRMU03-GG


“Midstream Co”

GREEN RIVER DEVCO LP

  By:   Green River DevCo GP LLC
      By:   Noble Midstream Services, LLC
          By:   /s/ Terry R. Gerhart
           

Terry R. Gerhart

           

Chief Executive Officer

 

STATE OF TEXAS

     )     
     )      ss.
COUNTY OF HARRIS      )     

The foregoing instrument was acknowledged before me this 25th day of August, 2016, by Terry R. Gerhart as Chief Executive Officer of Noble Midstream Services, LLC, which is the sole member of Green River DevCo GP LLC, which is the general partner of Green River DevCo LP, a Delaware limited partnership.

WITNESS my hand and official seal.

My commission expires: 05/05/2018            

 

/s/ Joanne Garner
Notary Public

 

Amendment 01 – Signature Page 2

Second Amended and Restated Gas Gathering Agreement

Green River Gas Gathering Agreement

GRMU03-GG

Exhibit 10.9

Execution Version

THIRD AMENDED AND RESTATED

CRUDE OIL TREATING AGREEMENT

consisting of the

THIRD AMENDED AND RESTATED

AGREEMENT TERMS AND CONDITIONS RELATING TO

CRUDE OIL TREATING SERVICES

taken together with the applicable

THIRD AMENDED AND RESTATED

AGREEMENT ADDENDUM

now or in the future effective


TABLE OF CONTENTS

 

             Page  
ARTICLE 1 DEFINITIONS      1   
  Section 1.1   Definitions      1   
  Section 1.2   Other Terms      9   
  Section 1.3   References and Rules of Construction      9   
ARTICLE 2 PRODUCT DEDICATION AND REAL PROPERTY DEDICATION      9   
  Section 2.1   Producer’s Dedications      9   
  Section 2.2   Conflicting Dedications      10   
  Section 2.3   Producer’s Reservation      10   
  Section 2.4   Releases from Dedication      11   
  Section 2.5   Covenants Running with the Land      12   
  Section 2.6   Recording of Agreement      13   
ARTICLE 3 RESERVED      13   
ARTICLE 4 RESERVED      13   
ARTICLE 5 TENDER AND NOMINATION      13   
  Section 5.1   Limitations on Service to Third Parties      13   
  Section 5.2   Tender of Dedicated Production      13   
  Section 5.3   Services; Service Standard      13   
  Section 5.4   Nominations, Scheduling and Curtailment      14   
  Section 5.5   Suspension/Shutdown of Service      14   
  Section 5.6   Marketing and Transportation      15   
  Section 5.7   No Prior Flow of Product in Interstate Commerce      15   
  Section 5.8   Downstream Delivery Points      15   
  Section 5.9   Meetings      15   
ARTICLE 6 FEES      15   
  Section 6.1   Fees      15   
  Section 6.2   Fee Adjustments      15   
  Section 6.3   Treatment of Byproducts, Fuel and Related Matters      16   
ARTICLE 7 QUALITY SPECIFICATIONS      17   
  Section 7.1   Quality Specifications      17   
  Section 7.2   Reserved      18   
  Section 7.3   Indemnification Regarding Quality      18   
ARTICLE 8 TERM      18   
  Section 8.1   Term      18   
  Section 8.2   Effect of Termination or Expiration of the Term      18   

 

i


ARTICLE 9 TITLE AND CUSTODY      19   
  Section 9.1   Title      19   
  Section 9.2   Custody      19   
ARTICLE 10 BILLING AND PAYMENT      19   
  Section 10.1   Statements      19   
  Section 10.2   Payments      20   
  Section 10.3   Adequate Assurances      20   
  Section 10.4   Audit      21   
ARTICLE 11 REMEDIES      21   
  Section 11.1   Suspension of Performance; Temporary Release from Dedication      21   
  Section 11.2   No Election      22   
  Section 11.3   DIRECT DAMAGES      22   
ARTICLE 12 FORCE MAJEURE      22   
  Section 12.1   Force Majeure      22   
  Section 12.2   Extension Due to Force Majeure      23   
ARTICLE 13 CHANGE IN LAW AND SCOPE      23   
  Section 13.1   Changes in Applicable Law      23   
  Section 13.2   Unprofitable Operations and Rights of Termination      24   
ARTICLE 14 REGULATORY STATUS      24   
  Section 14.1   Non-Jurisdictional System      24   
  Section 14.2   Government Authority Modification      25   
ARTICLE 15 INDEMNIFICATION AND INSURANCE      25   
  Section 15.1   Reciprocal Indemnity      25   
  Section 15.2   Indemnification Regarding Third Parties      26   
  Section 15.3   Penalties      26   
  Section 15.4   Insurance      26   
ARTICLE 16 ASSIGNMENT      26   
  Section 16.1   Assignment of Rights and Obligations under this Agreement      26   
  Section 16.2   Pre-Approved Assignments      28   
  Section 16.3   Change of Control      28   
ARTICLE 17 OTHER PROVISIONS      28   
  Section 17.1   Relationship of the Parties      28   
  Section 17.2   Notices      28   
  Section 17.3   Entire Agreement; Conflicts      29   
  Section 17.4   Waivers; Rights Cumulative      29   
  Section 17.5   Amendment      29   
  Section 17.6   Governing Law; Arbitration      29   
  Section 17.7   Parties in Interest      30   

 

ii


        Section 17.8   Preparation of Agreement    30
        Section 17.9   Severability    30
        Section 17.10   Counterparts    30
        Section 17.11   Confidentiality    30

 

EXHIBITS     
EXHIBIT A      RESERVED
EXHIBIT B      RESERVED
EXHIBIT C      RESERVED
EXHIBIT D      INSURANCE

 

iii


THIRD AMENDED AND RESTATED

AGREEMENT TERMS AND CONDITIONS RELATING TO

CRUDE OIL TREATING SERVICES

These THIRD AMENDED AND RESTATED AGREEMENT TERMS AND CONDITIONS RELATING TO CRUDE OIL TREATING SERVICES (these “ Agreement Terms and Conditions ”) (i) shall be effective with respect to each signatory of each Agreement Addendum (defined below) as of the Effective Date (defined below) specified in the applicable Agreement Addendum, (ii) were last updated as of March 31, 2016, (iii) are incorporated into and made a part of each Agreement Addendum, and (iv) taken together with the applicable Agreement Addendum shall constitute one Agreement, separate and apart from any other Agreement governed by these Agreement Terms and Conditions.

Recitals:

A. Producer owns rights, title and interests in certain oil and gas leases and other interests located within the Dedication Area (defined below) that require services related to the treating and processing of hydrocarbons.

B. Producer wishes to obtain such treating and processing services from each Midstream Co (defined below) that executes and delivers an Agreement Addendum (defined below) pursuant to these Agreement Terms and Conditions, as modified by the applicable Agreement Addendum.

C. Producer desires to dedicate to the Individual System (as defined below) crude oil that (a) Producer Controls (defined below), (b) was produced within the Dedication Area (defined below), (c) Producer elects to deliver to the Third Party Truck Unload Facilities (defined below) and (d) requires processing and additional treatment.

D. Each Midstream Co that executes and delivers an Agreement Addendum owns and operates an Individual System that processes and treats crude oil.

Agreements:

NOW, THEREFORE, in consideration of the foregoing Recitals, which are incorporated herein, the mutual agreements in this Agreement, and other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, Midstream Co, and Producer hereby agree as follows:

Article 1

Definitions

Section 1.1 Definitions . As used in this Agreement, the following capitalized terms shall have the meanings ascribed to them below:

Adequate Assurance of Performance ” has the meaning given to it in Section 10.3 .

Adjustment Year ” has the meaning given to it in Section 6.2(a)(ii) .

 

   

Third Amended and Restated

Crude Oil Treating Agreement


Affiliate ” means, with respect to any Person, any other Person that directly, or indirectly through one or more intermediaries, Controls, or is Controlled by, or is under common Control with, such Person. The following sentence shall not apply to the term “Affiliate” as used in Section 2.2(b) or the definition of “Conflicting Dedication”: Producer and its subsidiaries (other than OpCo and its subsidiaries), on the one hand, and OpCo and its subsidiaries, on the other, shall not be considered Affiliates of each other for purposes of this Agreement.

Agreement ” means the applicable Agreement Addendum taken together with these Agreement Terms and Conditions, as modified by such Agreement Addendum.

Agreement Addendum ” means each Agreement Addendum by and between a Producer and a Midstream Co that expressly states that it is governed by these Agreement Terms and Conditions. “ Agreement Addenda ” shall be the collective reference to each Agreement Addendum then in effect.

Agreement Terms and Conditions ” has the meaning given to it in the introductory paragraph.

Barrel ” means a quantity consisting of forty-two Gallons.

BS&W ” means basic sediment and water.

Business Day ” means a Day (other than a Saturday or Sunday) on which federal reserve banks are open for business.

Claiming Party ” has the meaning given to it in the definition of Force Majeure.

Communications ” has the meaning given to it in Section 17.2 .

Conditional Amount ” has the meaning given to it in Section 10.1(a) .

Conflicting Dedication ” means any polishing, processing or treating agreement, commitment, or arrangement (including any volume commitment) that requires Producer’s owned or Controlled Product to be polished, processed or treated in any polishing, processing or treating facility other than the System, including any such agreement, commitment, or arrangement burdening properties hereinafter acquired by Producer in the Dedication Area. A right of first refusal in favor of an entity other than Original Producer, OpCo, or any of their Affiliates shall be deemed to be a “Conflicting Dedication” if Affiliates of Original Producer are prohibited from providing Services pursuant to the applicable agreement creating such right of first refusal.

Control ” (including the term “ Controlled ”) means (a) with respect to any Person, the possession, direct or indirect, of the power to direct or cause the direction of the management and policies of a Person, whether through the ownership of voting shares, by contract, or otherwise and (b) with respect to any Product, such Product produced from the Dedication Area and owned by a Third Party or an Affiliate and with respect to which Producer has the contractual right or obligation (pursuant to a marketing, agency, operating, unit, or similar agreement) to market such Product and Producer elects or is obligated to market such Product on behalf of the applicable Third Party or Affiliate.

 

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Credit-Worthy Person ” means a Person with a senior unsecured and credit-unenhanced long term debt rating equivalent to A- or better as determined by at least two rating agencies, one of which must be either Standard & Poor’s or Moody’s (or if either one or both are not available, equivalent ratings from alternate rating sources reasonably acceptable to Midstream Co).

Day ” means a period of time from 7:00 a.m. Mountain Time on a calendar day until 7:00 a.m. Mountain Time on the succeeding calendar day. The term “ Daily ” shall have the correlative meaning.

Dedicated Production ” means (a) Product owned by Producer or an Affiliate of Producer and produced from a Well within the Dedication Area that is operated by Producer or an Affiliate under the Control of Producer, (b)  Reserved , (c) Product produced within the Dedication Area that is owned by a Third Party and under the Control of Producer and (d) Purchased Dedicated Production, in each case, that (1) Producer elects to Tender to the Third Party Truck Unload Facilities and (2) requires processing and additional treatment. Notwithstanding the foregoing, (i) any Product that was released pursuant to the Releases of Dedication shall not be included in this definition of “Dedicated Production,” (ii) any Product that is permanently released pursuant to Section 2.4(a) or otherwise shall cease to be included in this definition of “Dedicated Production” immediately upon the effectiveness of such permanent release, and (iii) in the event of an assignment by a Producer (“X”) to an assignee (“Y”) that is permitted under Article 16 , any Product that is so assigned shall cease to be included in X’s Dedicated Production and shall solely be included in Y’s Dedicated Production as of the effective date of such assignment.

Dedicated Properties ” means the interests held by Producer or its Affiliates in the oil and gas leases, mineral interests, and other similar interests as of the Effective Date or acquired by Producer or its Affiliates after the Effective Date that relate to land within the Dedication Area. Notwithstanding the foregoing, (a) any interest that was released pursuant to the Releases of Dedication shall not be included in this definition of “Dedicated Properties,” (b) any interest that is permanently released pursuant to Section 2.4(a) or otherwise shall cease to be included in this definition of “Dedicated Properties” immediately upon the effectiveness of such permanent release and (c) in the event of an assignment by a Producer (“X”) to an assignee (“Y”) that is permitted under Article 16 , any interest that is so assigned shall cease to be included in X’s Dedicated Properties and shall solely be included in Y’s Dedicated Properties as of the effective date of such assignment.

Dedications ” means the Product Dedication and the Real Property Dedication together, and “ Dedication ” means the Product Dedication or the Real Property Dedication, as applicable.

Dedication Area ” means the Dedication Area described in the applicable Agreement Addendum. Notwithstanding the foregoing, (a) any acreage that was released pursuant to the Releases of Dedication shall not be included in this definition of “Dedication Area,” (b) any acreage that is permanently released pursuant to Section 2.4(a) or otherwise shall cease to be included in this definition of “Dedication Area” immediately upon the effectiveness of such permanent release and (c) in the event of an assignment by a Producer (“X”) to an assignee (“Y”)

 

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that is permitted under Article 16 , any acreage that is so assigned shall cease to be included in X’s Dedication Area and shall solely be included in Y’s Dedication Area as of the effective date of such assignment.

Delivery Point ” means the point at which custody transfers from Midstream Co to or for the account of Producer. The custody transfer point may include (a) the tailgate of the Individual System or (b) any other point as may be mutually agreed between the Parties. The Delivery Points for each Individual System in existence on the Effective Date shall be set forth in writing between Producer and Midstream Co, and additional points may become Delivery Points hereunder upon mutual agreement of the Parties.

Downstream Facility ” means (a) any pipeline or pipeline storage facility downstream of any Delivery Point from the Individual System or Third Party Truck Unload Facility, or (b) a crude oil processing facility downstream of any Delivery Point (i) to which Producer has dedicated, or in the future elects to dedicate, any Dedicated Production for processing, or (ii) at which Producer has arranged for Dedicated Production to be processed further prior to delivery to a pipeline described in part (a) above.

Effective Date ” has the meaning given to it in the applicable Agreement Addendum.

Escalation Percentage ” means 2.50%.

Flash Gas ” means any gas that has been vaporized from Product resulting from the treating of Product in the Individual System pursuant to this Agreement.

Force Majeure ” means an event that is not within the reasonable control of the Party claiming suspension (the “ Claiming Party ”), and that by the exercise of reasonable due diligence the Claiming Party is unable to avoid or overcome in a reasonable manner. To the extent meeting the foregoing requirements, Force Majeure includes: (a) acts of God; (b) wars (declared or undeclared); (c) insurrections, hostilities, riots; (d) floods, droughts, fires, storms, storm warnings, landslides, lightning, earthquakes, washouts; (e) industrial disturbances, acts of a public enemy, acts of terror, sabotage, blockades, epidemics; (f) arrests and restraints of rulers and peoples; (g) civil disturbances; (h) explosions, breakage or accidents to machinery or lines of pipe; (i) hydrate obstruction or blockages of any kind in lines of pipe; (j) freezing of wells or delivery facilities, partial or entire failure of wells, and other events beyond the reasonable control of the Claiming Party that affect the timing of production or production levels; (k) ( reserved ); (l) action or restraint by any Governmental Authority (so long as the Claiming Party has not applied for or assisted in the application for, and has opposed where and to the extent commercially reasonable, such action or restraint), (m) delays or failures by a Governmental Authority to grant Permits applicable to the System (or any Individual System) so long as the Claiming Party has used its commercially reasonable efforts to make any required filings with such Governmental Authority relating to such Permits, and (n) delays or failures by the Claiming Party to obtain easements and rights of way, surface leases and other real property interests related to the System (or any Individual System) from Third Parties, so long as the Claiming Party has used its commercially reasonable efforts to obtain such easements and rights of way, surface leases and other real property interests. The failure of a Claiming Party to settle or prevent a strike or other labor dispute with employees shall not be considered to be a matter within such Claiming Party’s control.

 

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Gallon ” means one U.S. Standard gallon.

Governmental Authority ” means any federal, state, local, municipal, tribal or other government; any governmental, regulatory (including self-regulatory) or administrative agency, commission, body or other authority exercising or entitled to exercise any administrative, executive, judicial, legislative, regulatory or taxing authority or power; and any court or governmental tribunal, including any tribal authority having or asserting jurisdiction.

Group ” means (a) with respect to Midstream Co, the Midstream Co Group, and (b) with respect to Producer, the Producer Group.

Increase in Fee ” has the meaning given to it in Section 6.2(b) .

Individual Fee ” means the aggregate of the Individual Vertical Fee and the Individual Horizontal Fee set forth on the applicable Agreement Addendum.

Individual Horizontal Fee ” means the Monthly rate for making Services available to horizontal Relevant Wells at a particular Individual System, as set forth opposite the heading “Individual Horizontal Fee” on the applicable Agreement Addendum.

Individual System ” means each Product polishing, processing or treating facility owned by Midstream Co described on the applicable Agreement Addendum.

Individual Vertical Fee ” means the Monthly rate for making Services available to vertical Relevant Wells at a particular Individual System, as set forth opposite the heading “Individual Horizontal Fee” on the applicable Agreement Addendum.

Initial Term ” has the meaning given to it in Section 8.1 .

Interest Rate ” means, on the applicable date of determination, the prime rate (as published in the “Money Rates” table of The Wall Street Journal , eastern edition, or if such rate is no longer published in such publication or such publication ceases to be published, then as published in a similar national business publication as mutually agreed by the Parties) plus an additional two percentage points (or, if such rate is contrary to any applicable Law, the maximum rate permitted by such applicable Law).

Invoice Month ” has the meaning given to it in Section 10.1(a)

Law ” means any applicable statute, law, rule, regulation, ordinance, order, code, ruling, writ, injunction, decree or other official act of or by any Governmental Authority.

Losses ” means any actions, claims, causes of action (including actions in rem or in personam), settlements, judgments, demands, liens, encumbrances, losses, damages, fines, penalties, interest, costs, liabilities, expenses (including expenses attributable to the defense of any actions or claims and attorneys’ fees) of any kind or character, including Losses for bodily

 

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injury, death, or property damage, whether under judicial proceedings, administrative proceedings or otherwise, and under any theory of tort, contract, breach of contract, breach of representation or warranty (express or implied) or by reason of the conditions of the premises of or attributable to any Person or Person or any Party or Parties.

Midstream Co ” means the Original Midstream Co, together with its permitted successors and assigns, including any Midstream Co Assignee.

Midstream Co Assignee ” means any Third Party to whom Midstream Co assigns its rights and obligations in accordance with this Agreement.

Midstream Co Group ” means Midstream Co, its Affiliates, and the directors, officers, employees, and agents, of Midstream Co and its Affiliates; provided that all subsidiaries of OpCo that do not hold equity in Midstream Co shall be excluded from this definition.

Month ” means a period of time from 7:00 a.m. Mountain Time on the first Day of a calendar month until 7:00 a.m. Mountain Time on the first Day of the next succeeding calendar month. The term “ Monthly ” shall have the correlative meaning.

Moody’s ” means Moody’s Investors Service, Inc., or any successor to its statistical rating business.

OpCo ” means Noble Midstream Services, LLC, together with its permitted successors and assigns.

Original Midstream Co ” means the entity identified as the “Midstream Co” in the applicable Agreement Addendum as of the Effective Date.

Original Producer ” means Noble Energy, Inc.

Party ” or “ Parties ” with respect to each Agreement Addendum, shall mean the applicable Producer and the applicable Midstream Co. Unless expressly stated otherwise, references to “Parties” shall not refer to all parties to all Agreements governed hereby. Rather, references to “Parties” shall refer only to such Parties as determined by the applicable Agreement Addendum.

Permits ” means any permit, license, approval, or consent from a Governmental Authority.

Person ” means any individual, corporation, company, partnership, limited partnership, limited liability company, trust, estate, Governmental Authority, or any other entity.

Processed Crude Oil ” means Product that has been processed or treated at an Individual System.

Producer ” means the Original Producer, together with its permitted successors and assigns, including any Producer Assignee.

 

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Producer Assignee ” means any Person to whom Original Producer or any subsequent Producer sells, assigns, or otherwise transfers acreage subject to the Dedications.

Producer Group ” means Producer, its Affiliates, and the directors, officers, employees, and agents of Producer and its Affiliates.

Producer Processed Crude Oil ” means the Processed Crude Oil allocable to or for the account of Producer.

Product ” means the crude oil produced from oil or gas wells, in its natural form, after initial separation and storage in lease storage tanks, which may include associated water and Flash Gas naturally produced therewith.

Product Dedication ” means the dedication and commitment made by Producer pursuant to Section 2.1(a) .

Purchased Dedicated Production ” means Product produced by a Third Party that either (i) has been purchased by Producer or (ii) the Parties have mutually agreed should be considered “Dedicated Production”.

Real Property Dedication ” means the dedication and commitment made by Producer pursuant to the first sentence in Section 2.1(b) .

Receipt Point ” means the point at which custody transfers from Producer (or the operator of the applicable Third Party Truck Unload Facility or related facilities) to Midstream Co as set forth in writing between Producer and Midstream Co. Additional points may become Receipt Points hereunder upon mutual agreement of the Parties.

Redetermination Deadline ” has the meaning given to it in Section 6.2(a)(ii) .

Redetermination Proposal ” has the meaning given to it in Section 6.2(a)(i) .

Redetermined Individual Fee ” has the meaning given to it in Section 6.2(a)(i) .

Reimbursed Amount ” has the meaning given to it in Section 10.1(a) .

Release Conditions ” has the meaning given to it in Section 2.4(a) .

Releases of Dedication ” means those certain releases of dedication, executed by and among Original Producer, OpCo and certain of OpCo’s subsidiaries, pursuant to Section 2.4(a) prior to August 26, 2016.

Relevant Wells ” means, with respect to any Month, those Wells that are producing in paying quantities during such Month and are capable of delivering Product to or for the account of Producer at one or more storage tanks or other storage facilities from which such Product is ultimately trucked. In the event Producer is operating wells within Weld County, Colorado that would satisfy the definition of “Relevant Well” if such wells were located within the Dedication Area (for purposes of this sentence, the “additional wells”), and Producer in its good faith judgment believes that such additional wells may require the Services provided hereunder, then such additional wells will also be Relevant Wells.

 

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Rules ” has the meaning given to it in Section 17.6 .

Services ” means: (i) the receipt of Product Tendered by or on behalf of Producer at the Receipt Points; (ii) the polishing, processing and treating of such Product, as needed, to meet the quality specifications of the applicable Delivery Point; and (iii) the redelivery of Producer Processed Crude Oil at the applicable Delivery Points (as nominated by Producer and in such quantities as specified in Section 5.3(a) ).

Services Fee ” means, collectively, the fees described in Section 6.1 .

Standard & Poor’s ” means Standard & Poor’s Rating Group, a division of McGraw Hill, Inc., or any successor to its statistical rating business.

State ” means the state in which the Individual System is located.

System ” means all Individual Systems described in all of the Agreement Addenda.

Tender ” means the act of Producer’s making Product available or causing Product to be made available to the System at a Receipt Point. “ Tendered ” shall have the correlative meaning.

Term ” has the meaning given to it in Section 8.1 .

Third Party ” means any Person other than a Party to this Agreement or any Affiliate of a Party to this Agreement.

Third Party Assignment ” has the meaning given to it in Section 16.1(a) .

Third Party Truck Unload Facilities ” means the truck unload facilities that are owned by Third Parties and at which Product is unloaded for subsequent delivery into the System or into a Downstream Facility.

Transaction Document ” means each agreement entered into pursuant to the agreement terms and conditions related to gas gathering services, agreement terms and conditions related to oil gathering services, agreement terms and conditions related to produced water services, agreement terms and conditions related to gas processing services, agreement terms and conditions related to crude oil treating services, and agreement terms and conditions related to fresh water services, now or in the future existing between Producer and Midstream Co.

Well ” means a well (i) for the production of hydrocarbons, (ii) that is located in the Dedication Area, (iii) in which Producer owns an interest, and (iv) for which Producer has a right or obligation to market Product produced thereby through ownership or pursuant to a marketing, agency, operating, unit, or similar agreement.

Year ” means a period of time from January 1 of a calendar year through December 31 of the same calendar year; provided that the first Year shall commence on the Effective Date and run through December 31 of that calendar year, and the last Year shall commence on January 1 of the calendar year and end on the Day on which this Agreement terminates.

 

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Section 1.2 Other Terms .

Other capitalized terms used in this Agreement and not defined in Section 1.1 above have the meanings ascribed to them throughout this Agreement.

Section 1.3 References and Rules of Construction .

All references in this Agreement to Exhibits, Appendices, Articles, Sections, subsections and other subdivisions refer to the corresponding Exhibits, Appendices, Articles, Sections, subsections and other subdivisions of or to this Agreement unless expressly provided otherwise. Titles appearing at the beginning of any Articles, Sections, subsections and other subdivisions of this Agreement are for convenience only, do not constitute any part of this Agreement, and shall be disregarded in construing the language hereof. The words “this Agreement,” “herein,” “hereby,” “hereunder” and “hereof,” and words of similar import refer to this Agreement as a whole, including the applicable Agreement Addendum and all Exhibits, Appendices, and other attachments to these Agreement Terms and Conditions and the applicable Agreement Addendum, all of which are incorporated herein, and not to any particular Exhibit, Appendix, Article, Section, subsection or other subdivision unless expressly so limited. The word “including” (in its various forms) means “including without limitation.” The word “or” shall mean “and/or” unless a clear contrary intention exists. The word “from” means from and including, the word “through” means through and including, and the word “until” means until but excluding. All references to “$” or “dollars” shall be deemed references to United States dollars. The words “will” and “shall” have the same meaning, force, and effect. Each accounting term not defined herein will have the meaning given to it under generally accepted accounting principles. Pronouns in masculine, feminine or neuter genders shall be construed to state and include any other gender, and words, terms and titles (including terms defined herein) in the singular form shall be construed to include the plural and vice versa, unless the context otherwise requires. References to any Law, contract or other agreement mean such Law, contract or agreement as it may be amended, supplemented, released, revised, replaced, or otherwise modified from time to time.

Article 2

Product Dedication and Real Property Dedication

Section 2.1 Producer’s Dedications .

(a) Product Dedication . Subject to Section 2.2 through Section 2.4 , during the Term, Producer exclusively dedicates and commits to deliver to Midstream Co under this Agreement all of the Dedicated Production.

(b) Real Property Dedication . Subject to Section 2.2 through Section 2.4 , during the Term, Producer dedicates and commits the Dedicated Properties to Midstream Co for performance of the Services pursuant to this Agreement. Except for the Parties’ performance of their obligations under this Agreement, no further performance is required by either Party to effectuate the Real Property Dedication.

 

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Section 2.2 Conflicting Dedications .

(a) Notwithstanding anything in this Agreement to the contrary, Producer shall have the right to comply with (i) each of the Conflicting Dedications existing on the Effective Date or, in the case of a Producer Assignee, the effective date of such assignment, and (ii) any other Conflicting Dedication applicable as of the date of acquisition of any oil and gas leases, mineral interests, and other similar interests within the Dedication Area that are acquired by Producer after the Effective Date and otherwise would have become subject to the Dedications (but not any Conflicting Dedications entered into in connection with such acquisition). Producer shall have the right to comply with a Conflicting Dedication only until the first Day of the Month following the termination of such Conflicting Dedication. Producer shall not extend or renew any Conflicting Dedication and shall terminate each Conflicting Dedication as soon as permitted under the underlying contract without causing Producer to incur any costs or expenses deemed unreasonable or inappropriate in the opinion of Producer and shall not enter into any new Conflicting Dedication.

(b) Certain Conflicting Dedications contain rights of first refusal or other provisions that (i) entitle Producer to a release of acreage from such Conflicting Dedication if Producer dedicates the released acreage to a Third Party or (ii) expressly prohibit Producer from dedicating such released acreage to an Affiliate of Producer. As used herein, the term “ Conflicting Dedication ” shall include both the original right of first refusal (or similar right) and the dedication resulting from an exercise of such right of first refusal (or similar right) so long as the resulting dedication covers the same acreage as the original Conflicting Dedication.

(c) To the extent Producer claims that a Conflicting Dedication exists with respect to certain Services on specified Dedicated Properties, Midstream Co shall have the right to review the documentation creating such Conflicting Dedication, subject to confidentiality requirements applicable to such Conflicting Dedication.

Section 2.3 Producer’s Reservation . Producer reserves the following rights respecting Dedicated Production for itself:

(a) to operate (or cause to be operated) Wells producing Dedicated Production in its sole discretion, including the right to drill new Wells, repair and rework old Wells, temporarily shut in Wells, renew or extend, in whole or in part, any oil and gas lease or term mineral interest, or cease production from or abandon any Well or surrender any applicable oil and gas lease, in whole or in part, when no longer deemed by Producer to be capable of producing in paying quantities under normal methods of operation;

(b) in Producer’s sole discretion, to truck Product produced within the Dedication Area to any destination or market, provided that so long as Producer has the legal authority to direct the delivery location of such Product, any Product that, to the knowledge of Producer, requires treating or processing in order to be accepted into a Downstream Facility shall be trucked to a Third Party Truck Unload Facility that is serviced by the System; and

 

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(c) to pool, communitize or unitize Producer’s interests with respect to Dedicated Production.

Section 2.4 Releases from Dedication .

(a) Permanent Releases . Midstream Co shall permanently release from the Dedications: (i) any Dedicated Production from any Well or Dedicated Properties affected by one or more of the Release Conditions, (ii) any Dedicated Production that would have been delivered to Third Party Truck Unload Facilities affected by one or more of the Release Conditions, (iii) any Dedicated Properties affected by one or more of the Release Conditions and (iv) any Purchased Dedicated Production for which the Individual System has been affected by one or more of the Release Conditions. The “Release Conditions” are:

(i) Reserved ;

(ii) Reserved ;

(iii) expiration of the Term, as further described in Section 8.2 ;

(iv) written agreement of Producer and Midstream Co, and each Party shall consider in good faith any proposal by the other Party to permanently release any Dedicated Production or Dedicated Properties;

(v) the occurrence of a Force Majeure of the type described in clauses (l), (m) or (n) of the definition of “ Force Majeure ” affecting Midstream Co that continues for a period of 120 Days or more;

(vi) Midstream Co’s interruption or curtailment of receipts and deliveries of Product pursuant to Section 5.5 that continues for 90 Days or more;

(vii) a default by Midstream Co that remains uncured for 90 Days or more;

(viii) Producer’s rejection of any increase in the Individual Fee pursuant to Section 13.1(b) ;

(ix) Midstream Co’s suspension of Services pursuant to Section 13.2(a)(ii) that extends for the period of time stated in such Section; or

(x) Midstream Co’s election not to provide Services to a Producer Assignee pursuant to Section 16.1(a) .

Producer may deliver any Dedicated Production released from the Dedications pursuant to this Section 2.4 to such other Persons as it shall determine.

(b) Temporary Release . Midstream Co shall temporarily release from the Dedications: (i) any Dedicated Production from any Well or Dedicated Properties affected by one or more of the Interruption Conditions, (ii) any Dedicated Production that would have been delivered to Third Party Truck Unload Facilities affected by one or more of the Interruption

 

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Conditions, (iii) any Dedicated Properties affected by one or more of the Interruption Conditions, and (iv) any Purchased Dedicated Production for which the Individual System has been affected by one or more of the Interruption Conditions. The “ Interruption Conditions ” are:

(i) the occurrence and continuation of an uncured default by Midstream Co;

(ii) Midstream Co’s interruption or curtailment of receipts and deliveries of Product pursuant to Section 5.5 that continues for a period of 30 consecutive Days; and

(iii) Until a permanent release is required under Section 2.4(a) or Section 13.2 , Midstream Co’s suspension of Services pursuant to Section 13.2(a) (and, if Section 13.2(a)(i) applies, such temporary release shall continue at the discretion of Midstream Co, subject to the time limits set forth in Section 13.2(a)(i) ).

Producer may make alternative arrangements for the polishing, processing and treating of any Dedicated Production temporarily released from the Dedications pursuant to this Section 2.4(b) . To the extent that an interruption or curtailment can be limited to an Individual System, Midstream Co shall so limit such interruption or curtailment, and to the extent that Midstream Co does so limit such curtailment or interruption, the temporary release permitted by this Section 2.4(b) shall only apply to the affected Individual System. Such temporary release shall continue until the first Day of the Month after the Month during which Midstream Co cures the applicable default or the interruption, curtailment, or suspension of Services terminates; provided that, if Producer obtained temporary services from a Third Party (pursuant to a contract that does not give rise to a default under this Agreement) during the pendency of such default, interruption, curtailment or suspension, such release shall continue until the earlier of (A) the first Day of the Month that is six Months after the event or condition that gave rise to the interruption, curtailment or other temporary cessation has been corrected and (B) the first Day of the Month after the termination of the applicable contract with such Third Party.

(c) Evidence of Release . At the request of Producer, the Parties shall execute a release agreement reasonably acceptable to all Parties (which, in the case of a permanent release, shall be in recordable form) reflecting any release of Dedicated Production or Dedicated Properties pursuant to this Section 2.4 .

Section 2.5 Covenants Running with the Land . Subject to the provisions of Section 2.3 and Section 2.4, each of the Dedications (a) is a covenant running with the Dedicated Properties, (b) touches and concerns Producer’s interests in the Dedicated Properties, and (c) shall be binding on and enforceable by Midstream Co and its successors and assigns. Except as set forth in Article 16, (i) in the event Producer sells, transfers, conveys, assigns, grants or otherwise disposes of any or all of its interest in the Dedicated Properties, then any such sale, transfer, conveyance, assignment, grant or other disposition shall be made subject to this Agreement and (ii) in the event Midstream Co sells, transfers, conveys, assigns, grants or otherwise disposes of any or all of its interest in the Individual System, then any such sale, transfer, conveyance, assignment, grant or other disposition shall be made subject to this Agreement. The Real Property Dedication is not an executory contract under Section 365 of Title 11 of the United States Code (11 U.S.C. § 365).

 

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Section 2.6 Recording of Agreement . Producer hereby authorizes Midstream Co to record a memorandum of the Agreement in the real property records of the counties in which the Dedication Area is located. Midstream Co and Producer agree that until Midstream Co provides notice to the contrary, all payment terms and pricing information shall remain confidential and be redacted from any filings in the real property records.

Article 3

Reserved

Article 4

Reserved

Article 5

Tender and Nomination

Section 5.1 Limitations on Service to Third Parties . Midstream Co shall obtain Original Producer’s consent prior to offering services on an Individual System to any Third Party, unless (a) Midstream Co is required by a Governmental Authority to offer service to a Third Party, in which case Midstream Co shall provide Producer prior notice of offering such service to such Third Party, (b) such Third Party has become a Producer hereunder by virtue of assignment of Dedicated Properties and Midstream Co has not declined to provide Services to such Producer Assignee pursuant to Section 16.1(a) or (c) Original Producer has ceased to deliver Product to the Third Party Truck Unload Facility that services the applicable Individual System.

Section 5.2 Tender of Dedicated Production . Subject to Section 5.3 , (a) each Day during the Term, Producer shall Tender to the System all of the Dedicated Production that is produced within the Dedication Area and (b) Producer shall have the right to Tender to Midstream Co for Services under this Agreement Product that is not Dedicated Production so long as the applicable well is included as a Relevant Well (as described in the definition of “Relevant Well”) by Producer.

Section 5.3 Services; Service Standard .

(a) Services . Subject to this Section 5.3 , Midstream Co shall (i) provide Services for all Product that is Tendered by Producer to Midstream Co at the applicable Third Party Truck Unload Facility, so long as the total Product volume for an Individual System is not greater than the current capacity of such Individual System (as such capacity may be limited by then-effective regulations), and (ii) redeliver to Producer or for the benefit of Producer at the relevant Delivery Point equivalent quantities of Processed Crude Oil, adjusted for any Product loss or gain incident to, or occasioned by, the processing, treating, polishing, and redelivery of Product. Midstream Co may, at its discretion accept additional volumes from Producer.

(b) Services Standard . Midstream Co shall own and operate the System and perform the Services in a good and workmanlike manner in accordance with standards customary in the industry.

 

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(c) Priority of Service . Midstream Co shall cause (i) Product delivered by Original Producer to have priority service on the System over Product of any Producer Assignee to the extent not in violation of applicable Law, and (ii) Product delivered by Producer to have priority service on the System over Product of any Third Party.

Section 5.4 Nominations, Scheduling and Curtailment . Nominations and scheduling of Product and Processed Crude Oil available for, and interruptions and curtailment of, Services under this Agreement shall be performed in accordance with the following provisions:

(a) Reserved .

(b) Reserved .

(c) Adjustments . Nothing contained in this Agreement shall preclude Midstream Co from taking reasonable actions necessary to adjust receipts or deliveries under this Agreement in order to maintain the operational integrity and safety of an Individual System.

Section 5.5 Suspension/Shutdown of Service .

(a) Shutdown . During any period when all or any portion of the Individual System is shut down (i) because of maintenance, repairs, or Force Majeure, (ii) because such shutdown is necessary to avoid injury or harm to Persons or property, to the environment or to the integrity of all or any portion of the Individual System, or (iii) because providing Services hereunder has become uneconomic as further described in Section 13.2 , Midstream Co may interrupt or curtail receipts of Producer’s Product and the Product of other producers as set forth herein. In such cases, Midstream Co shall have no liability to Producer (subject to Section 11.1(b) ) for its failure to receive Product, except to the extent such shutdown is caused by the negligence, gross negligence or willful misconduct of Midstream Co. If Midstream Co is required to so interrupt or curtail receipts of Product, Midstream Co will advise (by telephone, following up by writing, which writing may be in the form of electronic mail) Producer of such interruption or curtailment as soon as practicable or in any event within twenty-four hours after the occurrence of such event.

(b) Planned Curtailments and Interruptions .

(i) Midstream Co shall have the right to curtail or interrupt receipts and deliveries of Product for brief periods to perform necessary maintenance of and repairs or modifications to the Individual System; provided, however, that to the extent reasonably practicable, Midstream Co shall coordinate its maintenance, repair and modification operations with the operations of Producer and, in any case, will use its reasonable efforts to schedule maintenance, repair and modification operations so as to avoid or minimize to the greatest extent possible service curtailments or interruptions.

(ii) Midstream Co shall provide Producer (x) with 30 Days prior notice of any upcoming normal and routine maintenance, repair and modification projects that Midstream Co has planned that would result in a curtailment or interruption of Producer’s deliveries and the estimated time period for such curtailment or interruption and (y) with

 

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six Months prior notice of any maintenance (A) of which Midstream Co has knowledge at least six Months in advance and (B) that is anticipated to result in a curtailment or interruption of Producer’s deliveries for five or more consecutive Days.

Section 5.6 Marketing and Transportation . As between the Parties, Producer shall be solely responsible, and shall make all necessary arrangements at and downstream of the Delivery Points, for the receipt, further transportation, and marketing of Producer’s owned and Controlled Processed Crude Oil. Midstream Co shall have no liability for any operations or activities upstream or downstream of the Individual System.

Section 5.7 No Prior Flow of Product in Interstate Commerce . Producer represents and warrants that at the time of Tender, none of the Product delivered at a Receipt Point hereunder has flowed in interstate commerce.

Section 5.8 Downstream Delivery Points . Midstream Co shall use its commercially reasonable efforts to maintain, and shall act as a reasonable and prudent operator in maintaining, all interconnect and operating agreements with Third Parties reasonably necessary to facilitate the redelivery of Producer Processed Crude Oil to Producer at the Delivery Points.

Section 5.9 Meetings . Midstream Co and its representatives shall have the right to meet not less frequently than Monthly with one or more representatives of Producer. At all such meetings, the Parties shall exchange updated information concerning the Dedicated Production, the performance of the Services, and other related matters.

Article 6

Fees

Section 6.1 Fees . Producer shall pay Midstream Co each Month in accordance with the terms of this Agreement, for all Services made available to Producer, whether or not Producer elects to deliver volumes to a Third Party Truck Unload Facility during such Month, an amount, for each Individual System, equal to the sum of (i) the product of (x) the Relevant Wells that are horizontal multiplied by (y) the applicable Individual Horizontal Fee, (ii) the product of (x) the Relevant Wells that are vertical multiplied by (y) the applicable Individual Vertical Fee and (iii) an amount equal to Producer’s allocated portion of the actual costs incurred by Midstream Co for electricity required to provide Services, such allocation to be based upon the aggregate quantities of Product received by Midstream Co. During any Month the Individual System is unavailable to provide Services, the Services Fee due pursuant to this Section 6.1 shall be reduced in proportion to the number of days in such Month the Individual System was unavailable.

Section 6.2 Fee Adjustments .

(a) Redetermination .

(i) Redetermination Proposal . Between November 1 and December 31 of any Year, Midstream Co shall prepare and deliver to Producer for its review and comment a written proposal (each, a “ Redetermination Proposal ”) to redetermine each Individual Fee

 

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(unless the Parties mutually agree not to redetermine any particular Individual Fee) in accordance with this Section 6.2(a) . Each Redetermination Proposal shall include relevant supporting documentation and shall take into account future items including operating revenue projections and all estimated operating expenses that Midstream Co believes will be necessary to provide the applicable Services; provided that a redetermined Individual Fee as agreed to by the Parties (a “ Redetermined Individual Fee ”) shall not recoup the difference between (A) estimated operating expenses or revenues and (B) actual operating expenses or revenues for periods prior to the effective date of such Redetermined Individual Fee. The Parties may agree to redetermine a particular Individual Fee without obligation to agree to redetermine any other Individual Fee.

(ii) Subsequent Redetermination Timing . Any Redetermined Individual Fee agreed to by the Parties on or prior to the last Business Day of February of the applicable Adjustment Year (“ Redetermination Deadline ”) shall become effective as of the first Day of the Month following the Month in which agreement has been reached. If the Parties fail to agree upon a redetermination of any Individual Fee set forth in the applicable Redetermination Proposal on or prior to the Redetermination Deadline, such Individual Fee shall remain in effect without redetermination pursuant to this Section 6.2(a) . For purposes of this Section 6.2(a)(ii) , the Year immediately after the Year during which a Redetermination Proposal is delivered is herein the “ Adjustment Year ”.

(b) Annual Escalation . Effective as of July 1 of each Year, the Individual Fee will be increased by multiplying the then-applicable Individual Fee by the Escalation Percentage (herein, the “ Increase in Fee ”) and adding the then-applicable Individual Fee to the Increase in Fee; provided that Reimbursed Amounts shall not be subject to this Section 6.2(b) . Such annual increase to the Individual Fee shall become effective on July 1 of the applicable Year, even if such Individual Fee was redetermined pursuant to Section 6.2(a) , with an effective date during the same Year.

Section 6.3 Treatment of Byproducts, Fuel and Related Matters . No separate fee shall be chargeable by Midstream Co and no refund or reduction in the Individual Fee shall be chargeable by or owed to Producer for the hydrocarbons or services described in this Section 6.3 , except as described in Section 6.3(d) .

(a) Reserved .

(b) Flash Gas . To the extent that any Flash Gas is recovered from the Product, Midstream Co may elect to use Flash Gas as fuel to operate the Individual System or to generate electricity for the operation of the Individual System pursuant to Section 6.3(d) . If Midstream Co does not use Flash Gas for such purposes, Midstream Co shall dispose of such Flash Gas in a commercially reasonable manner (including incinerating such Flash Gas or collecting such Flash Gas for processing, in the sole discretion of Midstream Co). Any Flash Gas derived from the Product shall be de minimis. If the amounts of Flash Gas recovered are consistently more than de minimis quantities, the Parties shall agree in writing to a methodology for addressing such Flash Gas.

 

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(c) Reserved .

(d) System Fuel . Producer, at its sole cost and expense, shall procure all fuel required to operate the Individual System or to generate electricity for the operation of the Individual System and arrange for transportation of such fuel to the Individual System.

Article 7

Quality Specifications

Section 7.1 Quality Specifications .

(a) Each Individual System will be operated as an independent and distinct facility, and as such, Product received from Producer at each Receipt Point shall conform to the quality specifications set forth in this Section 7.1 , provided that the following may be varied or adjusted as described in this Section 7.1 or by express language set forth in writing signed by both Parties. These specifications may be applied to each Barrel of Producer’s nomination and not be limited to the composite sample of the nomination.

 

     Crude Oil

API Gravity, º API

   33 – 65

Sulfur Content, Weight %

   <= 0.45

BS&W

   <= 3.0%

(b) (i) The Reid vapor pressure of the Product shall not exceed ten pounds (10 lbs.) at one hundred degrees Fahrenheit (100ºF); (ii) the true vapor pressure of the Product shall not result in non-compliance with federal, state or local regulations by Midstream Co or by pipelines downstream of the Delivery Point; and (iii) Product shall not contain or have been contaminated by the presence of any excessive deleterious substances, including, but not limited to, metals, chlorinated or oxygenated hydrocarbons, hydrogen sulfide, or salt.

(c) All Product delivered by Producer to Midstream Co shall have a maximum temperature of one hundred twenty degrees (120º) Fahrenheit at the Receipt Point.

(d) From time to time, Midstream Co may require that Producer furnish certified laboratory reports showing the results of quality tests on the Product tendered for gathering. Midstream Co may also from time to time obtain samples for laboratory analysis to check compliance with the specifications cited above.

(e) If Producer’s Product delivered to the Receipt Points complies with such quality specifications, then all Producer Processed Crude Oil redelivered at the Delivery Points by Midstream Co to Producer shall meet the quality specifications applicable at the relevant Delivery Points. Midstream Co may commingle Product received into the Individual System with other Product shipments and, subject to Midstream Co’s obligation to redeliver to Producer at the Delivery Points Producer Processed Crude Oil that satisfies the applicable quality specifications of the Delivery Points, (i) such Product shall be subject to such changes in quality, composition and other characteristics as may result from such commingling, (ii) Midstream Co

 

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shall have no other obligation to Producer associated with changes in quality of Product as the result of such commingling and (iii) Midstream Co shall have the right to change the quality specifications to comply with any changes in the Downstream Facility specifications.

Section 7.2 Reserved .

Section 7.3 Indemnification Regarding Quality . PRODUCER SHALL RELEASE, PROTECT, DEFEND, INDEMNIFY AND HOLD HARMLESS MIDSTREAM CO GROUP FROM AND AGAINST ALL LOSSES DIRECTLY OR INDIRECTLY ARISING OUT OF, IN CONNECTION WITH OR IN ANY MANNER ATTRIBUTABLE TO THE FAILURE OF THE PRODUCT DELIVERED BY PRODUCER TO THE INDIVIDUAL SYSTEM TO MEET THE QUALITY SPECIFICATIONS SET FORTH HEREIN, INCLUDING DISPOSAL COSTS, DAMAGE TO OR SUSTAINED BY THE INDIVIDUAL SYSTEM (INCLUDING THE EQUIPMENT AND COMPONENT PARTS), COSTS EXPENDED BY MIDSTREAM CO OR ANY OF ITS AFFILIATES TO RETURN THE INDIVIDUAL SYSTEM AND RELATED FACILITIES TO SERVICES, CLAIMS OF OTHER PRODUCERS ON THE INDIVIDUAL SYSTEM, CLAIMS OF OWNERS OF ALL DOWNSTREAM FACILITIES AND CLAIMS OF ALL PERSONS WHO ULTIMATELY USE THE NON-CONFORMING PRODUCT DELIVERED BY PRODUCER AND THE COSTS OF ALL REGULATORY OR JURISDICTIONAL PROCEEDINGS. MIDSTREAM CO’S TAKING OF NON-CONFORMING PRODUCT SHALL NOT RELIEVE PRODUCER OF ITS OBLIGATIONS UNDER THIS SECTION 7.3 .

Article 8

Term

Section 8.1 Term . The term of this Agreement commenced on January 1, 2015, which is the original effective date of the Parties’ agreement regarding the matters set forth herein, and this Agreement shall remain in effect until January 1, 2030 (the “ Initial Term ”) and thereafter on a Year to Year basis until terminated by Midstream Co or Producer effective upon the expiration of the Initial Term or the expiration of any Year thereafter upon notice no less than 90 Days prior to the expiration of the Initial Term or the expiration of any Year thereafter (such period of time, the “ Term ”).

Section 8.2 Effect of Termination or Expiration of the Term . Upon the termination of the Term, this Agreement shall forthwith become void and the Parties shall have no liability or obligation under this Agreement, except that (a) the termination of this Agreement shall not relieve any Party from any expense, liability or other obligation or remedy therefor that has accrued or attached prior to the date of such termination, (b) the provisions of Section 7.3 ,this Section 8.2 , Article 15 and Section 17.1 through Section 17.10 shall survive such termination and remain in full force and effect indefinitely, (c) and Section 10.4 and Section 17.11 shall survive such termination and remain in full force and effect for the period of time specified in such Sections.

 

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Article 9

Title and Custody

Section 9.1 Title . A nomination of Product by Producer shall be deemed a warranty of title to such Product by Producer, or a warranty that Producer Controls the Product and has the right to deliver such Product for polishing, processing and treating under this Agreement. Title to Product shall not transfer to Midstream Co by reason of Midstream Co’s performance of the Services.

Section 9.2 Custody . From and after Producer’s delivery of its owned or Controlled Product to Midstream Co at the Receipt Points, and, until Midstream Co’s redelivery of Producer Processed Crude Oil to or for Producer’s account at the applicable Delivery Points, as between the Parties, Midstream Co shall have custody and control of, and be responsible for, such Product and Producer Processed Crude Oil. In all other circumstances, as between the Parties, Producer shall be deemed to have custody and control of, and be responsible for, such Product and Processed Crude Oil.

Article 10

Billing and Payment

Section 10.1 Statements .

(a) Ordinary Course . Midstream Co shall submit invoices to Producer on or before the 25th Day after the end of a Month (the “ Invoice Month ”). Each invoice shall be accompanied by supporting information for all amounts charged by such invoice. All amounts owed for Services provided during an Invoice Month shall be reflected on the applicable invoice for such Invoice Month; provided that to the extent any amount appearing on an invoice is in respect of an amount paid by Midstream Co to a Third Party (collectively, the “ Reimbursed Amount ”), or the calculation of such amount is contingent on information provided by a Third Party (collectively, the “ Conditional Amount ”), such Reimbursed Amount and Conditional Amount, shall be reflected on an invoice within 90 Days after the end of the Month in which such Reimbursed Amount was paid by Midstream Co.

(b) Information from Producer . On or before the 10th Day after the end of the applicable Invoice Month, Producer shall deliver to Midstream Co a listing of each Relevant Well producing in paying quantities during such Invoice Month and such listing shall designate each such Relevant Well as either vertical or horizontal. Midstream Co shall be entitled to rely on such listing of Relevant Wells for purposes of invoicing and determining the Service Fee, and upon Midstream Co’s reasonable request therefor, Producer shall provide supporting documentation to substantiate such listing.

(c) Detail . Midstream Co shall cause its invoices and supporting information to include information reasonably sufficient to explain and support any charges reflected therein.

(d) Reserved .

 

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(e) One Invoice; Netting . To the extent that Midstream Co and Producer are party to this Agreement and one or more other Transaction Documents, one invoice may be delivered in respect of all amounts owing under such Transaction Documents. The Parties shall net all undisputed amounts due and owing or past due and owing arising under the Transaction Documents to which Producer and Midstream Co are parties such that the Party owing the greater amount shall make a single payment of the net amount to the other Party. No amounts owing to or by any Midstream Co may be set off against amounts owing to or by any other Midstream Co. No amounts owing to or by any Producer may be set off against amounts owing to or by any other Producer. To the extent possible, all fee adjustments set forth in Article 6 shall be accomplished by setoff or netting.

Section 10.2 Payments .

(a) Unless otherwise agreed by the Parties, all invoices under this Agreement shall be due and payable in accordance with each invoice’s instructions on or before the later of the 30th Day of each Month and the 10th Day after receipt of the invoice or, if such Day is not a Business Day, then on the next Business Day. All payments by Producer under this Agreement shall be made by electronic funds transfer to the account designated by Midstream Co. Any amounts not paid by the due date will be deemed delinquent and, with respect to amounts owed to Midstream Co, will accrue interest at the Interest Rate, such interest to be calculated from and including the due date but excluding the date the delinquent amount is paid in full.

(b) If Producer, in good faith, disputes the amount of any invoice of Midstream Co, Producer will pay Midstream Co such amount, if any, that is not in dispute and shall provide Midstream Co notice, no later than 30 Days after the date that payment of such invoice would be due under Section 10.2(a) , of the disputed amount accompanied by reasonable documentation to support Producer’s dispute. If Producer fails to provide notice of dispute within such 30-Day period, then Producer shall be deemed to have waived its right to dispute the applicable invoice, except for a dispute following an audit conducted in accordance with Section 10.4 . Following Midstream Co’s receipt of such dispute notice, Producer and Midstream Co shall endeavor in good faith to resolve such dispute, and if the Parties are unable to resolve such dispute within a reasonable time, such dispute may be resolved in accordance with Section 17.6 of this Agreement. Upon resolution of the dispute, any required payment shall be made within 15 Days after such resolution, and, if such amount shall be paid to Midstream Co, such amount shall be paid along with interest accrued at the Interest Rate from and including the due date but excluding the date paid.

Section 10.3 Adequate Assurances . If (a) Producer fails to pay according to the provisions hereof and such failure continues for a period of 5 Business Days after written notice of such failure is provided to Producer, (b) Producer is not the Original Producer or (c) Midstream Co has reasonable grounds for insecurity regarding the performance by Producer of any obligation under this Agreement, then Midstream Co, by notice to Producer, may, singularly or in combination with any other rights it may have, demand Adequate Assurance of Performance from Producer. “ Adequate Assurance of Performance ” means, at the option of Producer, any of the following, (x) advance payment in cash by Producer to Midstream Co for Services to be provided under this Agreement in the following Month or (y) delivery to Midstream Co by Producer of an irrevocable standby letter of credit or a performance bond, in

 

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form and substance reasonably acceptable to Midstream Co, issued by a Credit-Worthy Person, in an amount equal to not less than the aggregate proceeds due from Producer under Section 10.1 for the prior 2-Month period. Promptly following the termination of the condition giving rise to Midstream Co’s reasonable grounds for insecurity or payment in full of amounts outstanding, as applicable, Midstream Co shall release to Producer the cash, letter of credit, bond or other assurance provided by Producer (including any accumulated interest, if applicable, and less any amounts actually applied to cover Producer’s obligations hereunder).

Section 10.4 Audit . Each Party has the right, at its sole expense and during normal working hours, to examine the records of the other Party to the extent reasonably necessary to verify the accuracy of any statement, charge or computation made pursuant to the provisions of the Transaction Documents. The scope of such examination will be limited to the 24 Months preceding the date such notice of audit, statement, charge or computation was presented. No Party may conduct more than one audit (taking all Transaction Documents to which Producer is a party together) of another Party during any Year (except that, if a Party is in default hereunder, additional audits may be conducted during the continuance of such default). If any such examination reveals any inaccuracy in any statement or charge, the necessary adjustments in such statement or charge and the payments necessitated thereby shall be made within 60 Days of resolution of the inaccuracy. This provision of this Agreement will survive any termination of this Agreement for the later of (a) a period of 24 Months from the end of the Year in which the date of such termination occurred or (b) until a dispute initiated within the 24 Month period is finally resolved, in each case for the purpose of such statement and payment objections.

Article 11

Remedies

Section 11.1 Suspension of Performance; Temporary Release from Dedication .

(a) Suspension by Midstream Co as Remedy for Payment Default . If Producer fails to pay any invoice rendered under Article 10 , such failure is not due to a good faith dispute by Producer in accordance with Section 10.2(b) , and such failure is not remedied within 5 Business Days after Producer’s receipt of written notice of such failure from Midstream Co, Midstream Co shall have the right, at its sole discretion, to (i) suspend performance (including withholding any payments that are owed by Midstream Co to Producer, and such withheld amounts shall not be subject to setoff under Section 10.1(e) ) under this Agreement until such amount, including interest at the Interest Rate, is paid in full or (ii) continue performing the Services under this Agreement, and, acting in a commercially reasonable manner, sell any Product delivered by Producer to the Receipt Points on Producer’s behalf, and use the proceeds therefrom to reimburse Midstream Co for any amounts due and owing to Midstream Co, and, at Producer’s election, either (y) remit any excess amounts received under such sale to Producer or (z) reduce the Services Fee due from Producer to Midstream Co for the following Month by the amount of such excess.

(b) Additional Suspensions as Remedies . If a Party fails to perform or comply with any material warranty, covenant or obligation (other than as provided in Section 11.1(a) ) contained in this Agreement and such failure has not been remedied within 60 Days after its receipt of written notice from the other Party of such failure, then the non-defaulting Party shall

 

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have the right to suspend performance of its obligations under this Agreement that are affected by such failure or non-compliance (including withholding any payments that are owed to the other Party, and such withheld amounts shall not be subject to netting or setoff under Section 10.1(e) ); provided that Producer may not withhold any payments that are owed to Midstream Co for Services actually performed by Midstream Co.

(c) Specific Performance and Declaratory Judgments . Damages in the event of breach of this Agreement by a Party hereto may be difficult, if not impossible, to ascertain. Therefore, each Party, in addition to and without limiting any other remedy or right it may have, will have the right to seek a declaratory judgment and 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 Party from pursuing any other rights and remedies at law or in equity that such Party may have.

Section 11.2 No Election . In the event of a default by a Party under this Agreement, the other Party shall be entitled in its sole discretion to pursue one or more of the remedies set forth in this Agreement, or such other remedy as may be available to it under this Agreement, at Law or in equity, subject, however, to the limitations set forth in Section 11.3 and Article 15 . No election of remedies shall be required or implied as the result of a Party’s decision to avail itself of a remedy under this Agreement.

Section 11.3 DIRECT DAMAGES . A PARTY’S DAMAGES RESULTING FROM A BREACH OR VIOLATION OF ANY REPRESENTATION, WARRANTY, COVENANT, AGREEMENT OR CONDITION CONTAINED IN THIS AGREEMENT OR ANY ACT OR OMISSION ARISING FROM OR RELATED TO THIS AGREEMENT SHALL BE LIMITED TO ACTUAL DIRECT DAMAGES AND SHALL NOT INCLUDE ANY OTHER LOSS OR DAMAGE, INCLUDING INDIRECT, SPECIAL, CONSEQUENTIAL, INCIDENTAL, EXEMPLARY OR PUNITIVE DAMAGES, INCLUDING LOST PROFITS, PRODUCTION, OR REVENUES, AND EACH PARTY RELEASES THE OTHER PARTY FROM ALL SUCH CLAIMS FOR LOSS OR DAMAGE OTHER THAN ACTUAL DIRECT DAMAGES; PROVIDED THAT THIS LIMITATION TO DIRECT DAMAGES SHALL NOT LIMIT THE PARTIES’ INDEMNIFICATION OBLIGATIONS UNDER Section 7.3 , AND Article 15 .

Article 12

Force Majeure

Section 12.1 Force Majeure . If either Midstream Co or Producer is rendered unable by an event of Force Majeure to carry out, in whole or part, its obligations under this Agreement and such Party gives notice (which notice may initially be delivered orally so long as written notice is delivered as soon as reasonably practicable thereafter) and reasonably full details of the event (including the nature, extent, effect, and likely duration of the event or circumstances constituting the Force Majeure event) to the other Party as soon as practicable after the occurrence of the event, then, during the pendency of such Force Majeure, but only during that period, the obligations of the Party affected by the event shall be canceled or suspended, as applicable, to the extent required; provided , however , that notwithstanding anything in the

 

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foregoing to the contrary, no Party shall be relieved from any indemnification obligation or any obligation to make payments, as the result of Force Majeure, regardless of which Party is affected; provided further that if the Force Majeure impacts only a particular Individual System, then the suspension of obligations described in this sentence shall apply only to the applicable Individual System and not to the obligations owing in connection with the rest of the System. The Party affected by Force Majeure shall use commercially reasonable efforts to remedy the Force Majeure condition with all reasonable dispatch, shall give notice to the other Party of the termination of the Force Majeure, and shall resume performance of any suspended obligation promptly after termination of such Force Majeure.

Section 12.2 Extension Due to Force Majeure . If a Party is unable to meet any deadline set forth herein as a result of a Force Majeure, then provided that such Party complies with the provisions of Section 12.1 , such deadline shall be extended for a period of time equal to the period of time during which such Party is delayed due to the Force Majeure.

Article 13

Change in Law and Scope

Section 13.1 Changes in Applicable Law .

(a) If any new Laws are enacted or amended or any new interpretations in respect of previously existing Laws are issued after the Effective Date that require Midstream Co to make capital expenditures with respect to the System, then Midstream Co may propose an increase to the applicable Individual Fee as may be necessary or appropriate to preserve and continue for the Parties the rights and benefits originally contemplated for the Parties by this Agreement; provided, however , that no increase to the applicable Individual Fee pursuant to this Section 13.1 shall be applicable unless and until, in the reasonable judgment of Midstream Co, Midstream Co would be required to make capital expenditures with respect to the System in order to comply with such new Law that materially and adversely affects the economics of the Services provided, fees received, or the other economic benefits of this Agreement for Midstream Co.

(b) Producer shall accept or reject, in its sole discretion, Midstream Co’s proposed increase to the Individual Fee within 30 Days after receiving such proposal from Midstream Co. If Producer fails to provide notice of such acceptance or rejection within such 30-Day period, then Producer shall be deemed to have accepted such increase. If Producer rejects the amount of the proposed increase, then Midstream Co shall release the Wells, Receipt Points, and Dedicated Production that would have been affected by such increase in accordance with Section 2.4(a)(viii) . The Parties will amend, update, or revise the applicable Agreement Addendum in accordance with this Agreement to reflect any changes in the applicable Individual Fees agreed to in accordance with this Section 13.1 .

(c) Producer and Midstream Co shall use their commercially reasonable efforts to comply with new and amended applicable Laws and new interpretations of existing Laws.

 

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Section 13.2 Unprofitable Operations and Rights of Termination .

(a) Cessation of Services . If, in the sole discretion of Midstream Co, (i) the polishing, processing or treating of Product at any Individual System, or (ii) the delivery of Processed Crude Oil to any Delivery Point, under this Agreement, is or becomes uneconomical due to its volume, quality, or for any other cause, then Midstream Co shall not be obligated to provide the applicable Services so long as such condition exists.

(i) If Midstream Co suspends Services under this Section 13.2(a) as a result of Producer’s (A) negligence, willful misconduct, or breach of this Agreement, or (B) delivery of Product that fails to meet the quality specifications required by Section 7.1 , then Midstream Co may resume providing such Services at any time, upon two months’ advance written notice delivered to Producer, and the affected Wells, facilities, Receipt Points, and Dedicated Production shall only be permanently released as a result of suspension under this clause by mutual agreement of the Parties under Section 2.4(a)(iv) .

(ii) If Midstream Co suspends Services under this Section 13.2(a) for any reason other than as specified in clause (i) above and (x) such suspension continues for six consecutive Months or (y) Midstream Co delivers notice to Producer that such suspension shall be permanent, then the applicable Wells, facilities, Receipt Points, and Dedicated Production shall be permanently released as specified in Section 2.4(a)(ix) .

(b) Reserved .

(c) Start of Suspension of Services . Midstream Co shall cause any suspension of Services permitted by this Section 13.2 to commence on the first Day of a Month and not on any other Day.

(d) Supporting Documentation . As soon as Midstream Co determines that continuing to provide Services at existing facilities has been rendered uneconomic, Midstream Co shall communicate the same to Producer. Such notice shall be delivered to Producer at least 60 Days in advance of any proposed curtailment under this Section 13.2 and such notice shall be accompanied by documentation supporting its claim that certain Services have become uneconomical. Nothing in this Section 13.2(d) shall give Producer a right to consent to a suspension under this Section 13.2 .

(e) No Obligation to Drill or Operate . Nothing herein shall be construed to require Producer to drill any Well or to continue to operate any Well that a prudent operator would not in like circumstances drill or continue to operate.

Article 14

Regulatory Status

Section 14.1 Non-Jurisdictional System . The Services being provided by Midstream Co hereunder are intended to be processing and treatment services, and no Governmental Authority currently establishes the rates or terms of service relating to the Services. This Agreement is subject to all valid present and future Laws of Governmental Authorities now or hereafter having jurisdiction over the Parties, this Agreement, the Services performed, or the

 

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System. It is the intent of the Parties that no Governmental Authority shall alter any provisions in the Agreement in such a way that would have the effect of altering the economic benefits of either Party, as originally contemplated under this Agreement. The Parties shall (a) vigorously defend and support in good faith the enforceability of this Agreement and the continuance, without alternation, of the Services in any and all proceedings before any Governmental Authority in which this Agreement is subject to review and (b) not initiate or support, either directly or indirectly, any challenge with any Governmental Authorities to the rates provided herein or any other modification to this Agreement that would alter the economic benefits of a Party as originally contemplated under this Agreement.

Section 14.2 Government Authority Modification . Notwithstanding the provisions of Section 14.1, if the rates are changed or required to be changed or any other modification to this Agreement that alters the economic benefits of a Party, as originally contemplated under this Agreement, in response to any order, regulation, or other mandate of a Governmental Authority, then no such change or modification shall constitute a breach or other default under the terms of this Agreement, and the Parties shall negotiate in good faith to enter into such amendments to this Agreement or a separate arrangement in order to give effect, to the greatest extent possible, the economic benefit as originally contemplated in this Agreement. If, in the reasonable opinion of Midstream Co’s counsel, a Governmental Authority’s regulation of Midstream Co’s results in (a) Midstream Co not having the same economic benefits as originally contemplated under this Agreement or (b) Midstream Co’s or any of its Affiliate’s pipelines becoming subject to additional legal requirements or regulation, and the Parties have not mutually agreed as to how to mitigate or alleviate the foregoing, then Midstream Co shall have the right, without liability, to terminate this Agreement.

Article 15

Indemnification and Insurance

Section 15.1 Reciprocal Indemnity . To the fullest extent permitted by applicable Law and except as otherwise set forth in Section 7.3 :

(a) Producer Indemnification . Producer shall release, protect, defend, indemnify and hold harmless Midstream Co Group from and against all Losses directly or indirectly arising out of or in connection with bodily injury, death, illness, disease, or loss or damage to property of Producer or any member of Producer Group in any way arising out of or relating to this Agreement, directly or indirectly. THIS RELEASE, DEFENSE AND INDEMNITY OBLIGATION SHALL APPLY REGARDLESS OF FAULT OF MIDSTREAM CO GROUP OR ANY OTHER PERSONS.

(b) Midstream Co Indemnification . Midstream Co shall release, protect, defend, indemnify and hold harmless Producer Group from and against all Losses directly or indirectly arising out of or in connection with bodily injury, death, illness, disease, or loss or damage to property of Midstream Co or any member of Midstream Co Group in any way arising out of or relating to this Agreement, directly or indirectly. THIS RELEASE, DEFENSE AND INDEMNITY OBLIGATION SHALL APPLY REGARDLESS OF FAULT OF PRODUCER GROUP OR ANY OTHER PERSONS.

 

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(c) Regardless of Fault . AS USED IN THE PRECEDING TWO SUBCLAUSES, THE PHRASE “REGARDLESS OF FAULT” SHALL MEAN, WITH RESPECT TO ANY LOSS THAT IS CAUSED IN WHOLE OR IN PART BY THE NEGLIGENCE (WHETHER SOLE, JOINT, CONCURRENT, COMPARATIVE, CONTRIBUTORY, ACTIVE, PASSIVE, OR OTHERWISE), STRICT LIABILITY, OR OTHER FAULT, OF ANY MEMBER OF MIDSTREAM CO GROUP OR THE PRODUCER GROUP, WITHOUT REGARD TO THE CAUSE OR CAUSES THEREOF AND WITHOUT LIMITATION OF SUCH LOSS AND WHETHER OR NOT CAUSED BY A PRE-EXISTING CONDITION.

Section 15.2 Indemnification Regarding Third Parties . Each Party shall release, protect, defend, indemnify and hold the other Party harmless against any Loss by a Third Party that is not a member of the Producer Group or Midstream Co Group, to the extent such Loss (a) is caused by the negligence or willful misconduct of said indemnifying Party or such Party’s Group, or (b) in the case of Producer as indemnifying Party, results from claims by a Third Party of title, rights, or encumbrances in or to Product delivered by Producer to a Receipt Point.

Section 15.3 Penalties . Producer shall release, protect, defend, indemnify, and hold harmless Midstream Co from any Losses resulting from penalties imposed by a Downstream Facility in any transportation contracts or service agreements associated with, or related to, Producer’s owned or Controlled Product, including any penalties imposed pursuant to the Downstream Facility’s tariff.

Section 15.4 Insurance . Midstream Co and Producer shall (a) carry and maintain no less than the insurance coverage set forth in Exhibit D , and (b) cause such insurance to be (i) the primary coverage without any right of contribution from any other insurance held by the other Party to the extent of the insured Party’s indemnification obligations hereunder, and (ii) written and endorsed to include waivers of all subrogation rights of the insurers against Midstream Co and its Group (in the case of Producer’s insurance) or Producer and its Group (in the case of Midstream Co’s insurance). Unless Producer is Original Producer, Producer shall also cause the insurance carried and maintained by it pursuant to this Section 15.4 to be endorsed to name Midstream Co and its Group as additional insureds or provide blanket additional insured status that covers Midstream Co and its Group as additional insureds, except in the case of worker’s compensation insurance. Any insurance provided by OpCo on behalf of Midstream Co that comports with this Section 15.4 shall be deemed to satisfy these requirements.

Article 16

Assignment

Section 16.1 Assignment of Rights and Obligations under this Agreement .

(a) Assignment . Except as specifically otherwise provided in this Agreement, no Party shall have the right to assign its rights and obligations under this Agreement (in whole or in part) to another Person except with the prior consent of Midstream Co (in the case of an assignment by Producer) or Producer (in the case of an assignment by Midstream Co), which consent may be withheld at such Party’s sole discretion. Notwithstanding the foregoing, Producer may assign its rights and obligations under this Agreement to any Person to whom Producer assigns or transfers an interest in any of the Dedicated Properties insofar as this

 

  26  

Third Amended and Restated

Crude Oil Treating Agreement


Agreement relates to such Dedicated Properties without the consent of Midstream Co; provided that (A) such Person assumes in writing the obligations of Producer under this Agreement insofar as it relates to the portion of the Dedicated Properties so assigned or transferred, such writing shall take the form of an Agreement Addendum, executed by the applicable Midstream Co and the Producer Assignee (and others, if appropriate) and such writing shall be recorded in the real property records of the counties in which the Dedication Area is located, (B) such assignment is made subject to this Agreement, (C) if such assignment or transfer is made to an Affiliate of Original Producer, the Original Producer shall not be released from any of its obligations under this Agreement, and (D) if such transfer or assignment is to a Person that is not an Affiliate of Original Producer (a “ Third Party Assignment ”): (1) the Original Producer shall be released from its obligations under this Agreement with respect to the Dedicated Properties so assigned or transferred, (2) at least thirty (30) Days prior to the closing date of the Third Party Assignment (or, if the period between signing and closing is less than thirty (30) Days, as early as possible and in no event less than two Business Days prior to the closing of the Third Party Assignment), Producer shall have provided Midstream Co with notice of the closing date of the Third Party Assignment, and (3) prior to or on the closing date of the Third Party Assignment, the Producer Assignee shall deliver to Midstream Co (x) a copy of the writing pursuant to which the Third Party Assignment is occurring, and (y) documentation of any Conflicting Dedication affecting any Product of the Producer Assignee that would otherwise be considered Dedicated Production. Notwithstanding the foregoing, if the addition of facilities, or any modification, expansion or alteration of any Individual System or any facilities, is required, necessary or convenient (in the opinion of Midstream Co) to accept, measure, account for, or treat Product from, and otherwise provide the Services to, Producer Assignee, then Midstream Co, may elect, in its sole discretion, not to make such addition, modification, expansion or alteration, and not to provide the applicable Services with respect to Dedicated Properties so assigned or transferred under this Section 16.1(a) . If Midstream Co elects not to make such addition, modification, expansion or alteration, Midstream Co shall notify Producer of its election prior to the closing date of the Third Party Assignment and the Services associated with the Dedicated Properties so assigned or transferred shall cease on the closing date of such Third Party Assignment, and Midstream Co shall execute and deliver, pursuant to Section 2.4(a)(x) , a release of all of the Dedicated Properties and Dedicated Production so assigned or transferred under this Section 16.1(a) . At Midstream Co’s election, such release may be delivered either to the Producer selling the applicable acreage or to Producer Assignee, in either case, substantially concurrently with Midstream Co’s cessation of Services.

(b) Notice; Binding Effect . Within 30 Days prior to the date of execution of a permitted assignment by Producer, Producer shall give Midstream Co notice of any assignment of this Agreement or Dedicated Properties. Midstream Co shall give Producer written notice of any assignment of this Agreement within 30 Days after the date of execution of such permitted assignment. This Agreement shall be binding upon and inure to the benefit of the respective permitted successors and assigns of the Parties. Any attempted assignment made without compliance with the provisions set forth in this Section 16.1 shall be null and void ab initio .

(c) Releases not Assignments . Any release of any of the Dedicated Properties from the Dedications pursuant to Section 2.4 shall not constitute an assignment or transfer of such Dedicated Properties for the purposes of this Article 16 .

 

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Section 16.2 Pre-Approved Assignments . Each Party shall have the right without the prior consent of the others to (a) mortgage, pledge, encumber or otherwise impress a lien or security interest upon its rights and interest in and to this Agreement, and (b) make a transfer pursuant to any security interest arrangement described in (a) above, including any judicial or non-judicial foreclosure and any assignment from the holder of such security interest to another Person.

Section 16.3 Change of Control . Except as provided in Section 16.1, nothing in this Article 16 shall prevent Producer’s members or owners from transferring their respective interests (whether equity or otherwise and whether in whole or in part) in Producer and nothing in this Article 16 shall prevent Midstream Co’s members or owners from transferring their respective interests (whether equity or otherwise and whether in whole or in part) in Midstream Co. However, if a change of control of a Party gives rise to a reasonable basis for insecurity on the part of the other Party, such change of control may be the basis for a request of Adequate Assurance of Performance. Each member or owner of Producer or Midstream Co, as applicable, shall have the right to assign and transfer such member’s or owner’s interests (whether equity or otherwise and whether in whole or in part) in Producer or Midstream Co, as applicable, without restriction contained in this Agreement.

Article 17

Other Provisions

Section 17.1 Relationship of the Parties . The execution and delivery of an Agreement Addendum shall create a binding agreement between the Parties signatory thereto consisting of the terms set forth in such Agreement Addendum together with the terms set forth in these Agreement Terms and Conditions. The signatories of one Agreement Addendum shall not be bound to or otherwise in privity of contract with the signatories of any other Agreement Addendum, and the execution and delivery of each Agreement Addendum shall form a separate and distinct contract. This Agreement shall not be deemed or construed to create, a partnership, joint venture or association or a trust between Producer and Midstream Co or the persons party to any other Agreement Addendum. This Agreement shall not be deemed or construed to authorize any Party to act as an agent, servant or employee for any other Party for any purpose whatsoever except as explicitly set forth in this Agreement. In their relations with each other under this Agreement, the Parties shall not be considered fiduciaries.

Section 17.2 Notices . Unless otherwise specified in the applicable provision, all notices, consents, approvals, requests, and other communications required or permitted to be given under this Agreement shall be in writing and delivered personally, or sent by bonded overnight courier, mailed by U.S. Express Mail or by certified or registered United States Mail with all postage fully prepaid, return receipt requested, or, except in the case of notices of breach or default, sent by electronic mail (including with a PDF of the notice or other communication attached), in each case, addressed (i) if to Producer, at the address set forth on the applicable Agreement Addendum and (ii) if to Midstream Co, at the address set forth on the applicable Agreement Addendum; provided that in the case of any notice by electronic mail, such notice is confirmed by communication via another method permitted by this Section 17.2 . Any notice, consent, approval, request, or other communication (“ Communications ”) given in accordance herewith shall be deemed to have been given when (a) actually received or rejected by the

 

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Third Amended and Restated

Crude Oil Treating Agreement


addressee in person or by courier, (b) ( reserved ), or (c) actually received or rejected by the addressee upon delivery by overnight courier or United States Mail, as shown in the tracking report or return receipt, as applicable. Communications may not be transmitted by electronic mail, except for ordinary course business communications that shall be deemed to be received, if transmitted during normal business hours on such Business Day, or if transmitted after normal business hours, on the next Business Day. Any Person may change their contact information for notice by giving notice to the other Party in the manner provided in this Section 17.2 .

Section 17.3 Entire Agreement; Conflicts . This Agreement (consisting of these Agreement Terms and Conditions and the applicable Agreement Addendum) constitutes the entire agreement of Producer and Midstream Co pertaining to the subject matter hereof and supersedes all prior agreements, understandings, negotiations, and discussions, whether oral or written, of Producer and Midstream Co pertaining to the subject matter hereof. There are no warranties, representations, or other agreements between Producer and Midstream Co relating to the subject matter hereof except as specifically set forth in this Agreement, including the exhibits hereto, and no Party shall be bound by or liable for any alleged representation, promise, inducement, or statements of intention not so set forth.

Section 17.4 Waivers; Rights Cumulative . Any of the terms, covenants, or conditions hereof may be waived only by a written instrument executed by or on behalf of the Person waiving compliance. No course of dealing on the part of any Party, or their respective officers, employees, agents, or representatives, nor any failure by a Party to exercise any of its rights under this Agreement shall operate as a waiver thereof or affect in any way the right of such Party at a later time to enforce the performance of such provision. No waiver by any Party of any condition, or any breach of any term or covenant contained in this Agreement, in any one or more instances, shall be deemed to be or construed as a further or continuing waiver of any such condition or breach or a waiver of any other condition or of any breach of any other term or covenant. The rights of Producer and Midstream Co under this Agreement shall be cumulative, and the exercise or partial exercise of any such right shall not preclude the exercise of any other right.

Section 17.5 Amendment .

(b) This Agreement may be amended only by an instrument in writing executed (except as otherwise set forth in this Section 17.5 ) by Producer and Midstream Co and expressly identified as an amendment or modification.

(c) In the event of a conflict between (i) these Agreement Terms and Conditions or any exhibit to this agreement, on the one hand, and (ii) an applicable Agreement Addendum, on the other, the applicable Agreement Addendum shall control.

Section 17.6 Governing Law; Arbitration . This Agreement shall be governed by and construed in accordance with the laws of the State, excluding any conflicts of law rule or principle that might refer construction of such provisions to the laws of another jurisdiction. Any dispute, controversy, or claim arising out of or relating to this Agreement shall be finally settled by arbitration in accordance with the CPR Institute for Dispute Resolution Rules for Non-Administered Arbitration then in effect (the “ Rules ”) by a sole arbitrator appointed in accordance

 

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Third Amended and Restated

Crude Oil Treating Agreement


with the Rules. The arbitrator is not empowered to award consequential, indirect, special, punitive or exemplary damages, and each Party irrevocably waives any damages in excess of actual damages. Arbitration shall be held in the English language in the State, and the decision of the arbitration panel shall include a statement of the reasons for such decision, and the award shall be final and binding on Producer and Midstream Co. Awards shall be final and binding on Producer and Midstream Co from the date they are made and judgment upon any award may be entered in any court having jurisdiction. The arbitrator shall apply the laws of the State, excluding any conflicts of law rule or principle that might refer construction of such provisions to the laws of another jurisdiction.

Section 17.7 Parties in Interest . Except for parties indemnified hereunder, nothing in this Agreement shall entitle any Person other than the Parties to any claim, cause of action, remedy or right of any kind.

Section 17.8 Preparation of Agreement . The Parties and their respective counsel participated in the preparation of this Agreement. In the event of any ambiguity in this Agreement, no presumption shall arise based on the identity of the draftsman of this Agreement.

Section 17.9 Severability . If any term or other provision of this Agreement is invalid, illegal, or incapable of being enforced by any rule of Law or public policy, all other conditions and provisions of this Agreement shall nevertheless remain in full force and effect so long as the economic or legal substance of the transactions contemplated hereby is not affected in any adverse manner to any Party. Upon such determination that any term or other provision is invalid, illegal, or incapable of being enforced, Producer and Midstream Co shall negotiate in good faith to modify this Agreement so as to effect the original intent of Producer and Midstream Co as closely as possible in an acceptable manner to the end that the transactions contemplated hereby are fulfilled to the extent possible. A ruling of invalidity, illegality or unenforceability as to one Agreement shall only be applicable to that Agreement, not all the Agreements covered by these Agreement Terms and Conditions.

Section 17.10 Counterparts . This Agreement may be executed in any number of counterparts, and each such counterpart hereof shall be deemed to be an original instrument, but all of such counterparts shall constitute for all purposes one agreement. Any signature hereto delivered by a Party by electronic mail shall be deemed an original signature hereto; provided that the originals of any such electronically provided signatures shall be provided by the signatory, if requested by the other Party within a week of exchanging signatures.

Section 17.11 Confidentiality . All data and information exchanged by the Parties (other than the terms and conditions of this Agreement) and all pricing terms shall be maintained in strict and absolute confidence and no Party shall disclose, without the prior consent of the other Parties, any such data, information or pricing terms unless the release thereof is required by Law (including any requirement associated with an elective filing with a Governmental Authority) or the rules or regulations of any stock exchange on which any securities of the Parties, or any Affiliates thereof are traded. Nothing in this Agreement shall prohibit the Parties from disclosing whatever information in such manner as may be required by applicable Law; nor shall any Party be prohibited by the terms hereof from disclosing information acquired under this Agreement to any financial institution or investors providing or proposing financing to a Party,

 

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Third Amended and Restated

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or to any Person proposing to purchase the equity in any Party or the assets owned by any Party. Notwithstanding the foregoing, the restrictions in this Section 17.11 will not apply to data or information that (i) is in the possession of the Person receiving such information prior to disclosure by the other Party, (ii) is or becomes known to the public other than as a result of a breach of this Agreement or (iii) becomes available to a Party a non-confidential basis from a source other than the other Party, provided that such source is not bound by a confidentiality agreement with, or other fiduciary obligations of confidentiality to, the other Party. This Section will survive any termination of this Agreement for a period of 24 Months from the end of the Year in which the date of such termination occurred.

(End of Agreement Terms and Conditions)

 

  31  

Third Amended and Restated

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EXHIBIT A

TO AGREEMENT TERMS AND CONDITIONS

RELATING TO OIL TREATING SERVICES

RESERVED

 

  Exhibit A - Page 1  

Third Amended and Restated

Crude Oil Treating Agreement


EXHIBIT B

TO AGREEMENT TERMS AND CONDITIONS

RELATING TO OIL TREATING SERVICES

RESERVED

 

  Exhibit B- Page 1  

Third Amended and Restated

Crude Oil Treating Agreement


EXHIBIT C

TO AGREEMENT TERMS AND CONDITIONS

RELATING TO OIL TREATING SERVICES

RESERVED

 

  Exhibit C- Page 1  

Third Amended and Restated

Crude Oil Treating Agreement


EXHIBIT D

TO AGREEMENT TERMS AND CONDITIONS

RELATING TO OIL TREATING SERVICES

INSURANCE

Midstream Co and Producer shall (or, in the case of Midstream Co, Midstream Co may cause OpCo to) purchase and maintain in full force and effect at all times during the Term of this Agreement, at such Party’s sole cost and expense and from insurance companies that are rated (or whose reinsurers are rated) “A-VII” or better by AM Best or “BBB-” or better by Standard & Poor’s or an equivalent rating from another recognized rating agency, policies providing the types and limits of insurance indicated below, which insurance shall be regarded as a minimum and, to the extent of the obligations undertaken by such Party in this Agreement, shall be primary (with the exception of the Excess Liability Insurance and Workers’ Compensation) as to any other existing, valid, and collectable insurance. Each Party’s deductibles shall be borne by that Party.

 

  A. Where applicable, Workers’ Compensation and Employers’ Liability Insurance, in accordance with the statutory requirements of the State, and endorsed specifically to include the following:

 

  1. Employers’ Liability, subject to a limit of liability of not less than $1,000,000 per accident, $1,000,000 for each employee/disease, and a $1,000,000 policy limit.

The Workers’ Compensation and Employers’ Liability Insurance policy(ies) shall contain an alternate employer endorsement.

 

  B. Commercial General Liability Insurance, with limits of liability of not less than the following:

$2,000,000 general aggregate

$1,000,000 each occurrence, Bodily Injury or Property Damage Combined Single Limit

Such insurance shall include the following:

 

  1. Premises and Operations coverage.

 

  2. Contractual Liability covering the liabilities assumed under this Agreement.

 

  3. Broad Form Property Damage Liability endorsement, unless policy is written on November 1988 or later ISO form.

 

  4. Products and Completed Operations.

 

  5. Time Element Limited Pollution coverage.

 

  Exhibit D - Page 1  

Third Amended and Restated

Crude Oil Treating Agreement


  C. If applicable, Automobile Liability Insurance, with limits of liability of not less than the following:

 

     $1,000,000 Bodily Injury or Property Damage Combined Single Limit, for each occurrence.

Such coverage shall include hired and non-owned vehicles and owned vehicles where applicable.

 

  D. (Reserved)

 

  E. Excess Liability Insurance, with limits of liability not less than the following:

Limits of Liability - $10,000,000 Occurrence/Aggregate for Bodily Injury and Property Damage in excess of the coverage outlined in Paragraphs A, B, C and D.

The limits of coverage required in this Agreement may be met with any combination of policies as long as the minimum required limits are met.

Each Party to this Agreement shall have the right to acquire, at its own expense, such additional insurance coverage as it desires to further protect itself against any risk or liability with respect to this Agreement and operations and activities under this Agreement or related thereto. All insurance maintained by or on behalf of Producer or Midstream Co shall contain a waiver by the insurance company of all rights of subrogation in favor of the other Party.

Neither the minimum policy limits of insurance required of the Parties nor the actual amounts of insurance maintained by the Parties under their insurance program shall operate to modify the Parties’ liability or indemnity obligations in this Agreement.

A Party may self-insure the requirements in this Exhibit D if such Party is Controlled by Noble Energy, Inc. and, otherwise, if such Party or its parent is considered investment grade (S&P BBB- or equivalent or higher).

(End of Exhibit D)

 

  Exhibit D - Page 2  

Third Amended and Restated

Crude Oil Treating Agreement

Exhibit 10.10.1

TERMS IN THIS EXHIBIT HAVE BEEN REDACTED BECAUSE CONFIDENTIAL TREATMENT FOR THOSE TERMS HAS BEEN REQUESTED. THE REDACTED MATERIAL HAS BEEN FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION, AND THE TERMS HAVE BEEN MARKED AT THE APPROPRIATE PLACE WITH TWO BRACKETED ASTERISKS [**].

THIRD AMENDED AND RESTATED

CRUDE OIL TREATING AGREEMENT

THIRD AMENDED AND RESTATED

AGREEMENT ADDENDUM 01

P LATTEVILLE F ACILITY

C ONTRACT N UMBER : CRALL1-OT

This THIRD AMENDED AND RESTATED AGREEMENT ADDENDUM 01 (this “ Agreement Addendum ”) (a) shall be effective as between the Persons named below as “Producer” and “Midstream Co” as of the date specified below as the “Effective Date,” (b) incorporates the Third Amended and Restated Agreement Terms and Conditions Relating to Crude Oil Treating Services (the “ Agreement Terms and Conditions ”), which were last amended effective as of March 31, 2016, and (c) together with the Agreement Terms and Conditions, shall constitute one contract and shall be the Agreement of the Parties. Except as otherwise set forth herein (i) all terms shall have the meanings assigned to such terms in the Agreement Terms and Conditions and (ii) all references to Exhibits, Appendices, Articles, Sections, subsections and other subdivisions refer to the corresponding Exhibits, Appendices, Articles, Sections, subsections and other subdivisions of or to the Agreement Terms and Conditions.

Producer desires to contract with Midstream Co for Midstream Co to provide the Services utilizing the Individual System, and Midstream Co desires to provide the Services to Producer, on the terms and subject to the conditions of this Agreement.

NOW, THEREFORE, in consideration of the mutual agreements in this Agreement, Midstream Co and Producer hereby agree as follows:

 

Producer

   Noble Energy, Inc., a Delaware corporation

Midstream Co

   Colorado River DevCo LP, a Delaware limited partnership

Individual System

   This Agreement Addendum pertains only to Services provided by Midstream Co at the oil treating facility known by Midstream Co as the Platteville Facility.

Parties

   The term “Party” or “Parties” shall refer to Producer and the Midstream Co identified in this Agreement Addendum

Effective Date

   March 31, 2016

Dedication Area

   Weld County, Colorado and surrounding counties, less and except those leases were released pursuant to a Release of Dedication.

 

Agreement Addendum 01 –Page 1

Third Amended and Restated Crude Oil Treating Agreement


TERMS IN THIS EXHIBIT HAVE BEEN REDACTED BECAUSE CONFIDENTIAL TREATMENT FOR THOSE TERMS HAS BEEN REQUESTED. THE REDACTED MATERIAL HAS BEEN FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION, AND THE TERMS HAVE BEEN MARKED AT THE APPROPRIATE PLACE WITH TWO BRACKETED ASTERISKS [**].

 

Individual Horizontal Fee    $[**]/Relevant Well
Individual Vertical Fee    $[**]/Relevant Well

 

Additional Revisions

 

Section 6.1    At all times that Midstream Co is party to both Agreement Addendum 01 and Agreement Addendum 02, Producer shall be charged a total (in the aggregate across both Agreements) of $[**]/ Relevant Well that is horizontal and $[**]/ Relevant Well that is vertical. If Midstream Co is not a party to both Agreement Addendum 01 and Agreement Addendum 02, Midstream Co and Producer shall negotiate an equitable price adjustment for the provision of Services.

 

Notices and Payments

Notice Address –

General Matters &

Correspondence

   Midstream Co and Producer shall deliver appropriate contact information to the other Party in writing.

 

Notice Address –

Operational Matters

  

 

Notice Address – Force

Majeure and Marketing

interruptions

  

 

Notice Address –

Invoicing Matters

  

 

Marketing Notice –

Midstream Co

  

 

Payments by Electronic

Funds Transfer

  

 

Midstream Co and Producer shall deliver appropriate contact information to the other Party in writing

(End of Agreement Addendum 01)

 

Agreement Addendum 01 –Page 2

Third Amended and Restated Crude Oil Treating Agreement


IN WITNESS WHEREOF, the Parties hereto have executed this Agreement in duplicate originals to be effective as of the Effective Date.

“Producer”

 

NOBLE ENERGY, INC.

By:  

/s/ Gary W. Willingham

  Gary W. Willingham
  Executive Vice President

 

STATE OF TEXAS

   )
   )   ss.

COUNTY OF HARRIS            

   )

The foregoing instrument was acknowledged before me this 29th day of August 2016, by Gary W. Willingham as Executive Vice President of Noble Energy, Inc., a Delaware corporation.

WITNESS my hand and official seal.

My commission expires: 05/05/2018

 

/s/ Joanne Garner

Notary Public

 

Agreement Addendum 01 – Signature Page 1

Third Amended and Restated Crude Oil Treating Agreement


“Midstream Co”

COLORADO RIVER DEVCO LP

        By:   Colorado River DevCo GP LLC
                    By:   Noble Midstream Services, LLC
By:   /s/ Terry R. Gerhart  
  Terry R. Gerhart  
  Chief Executive Officer

 

STATE OF TEXAS    )
   )   ss.
COUNTY OF HARRIS                )

The foregoing instrument was acknowledged before me this 25th day of August 2016, by Terry R. Gerhart as Chief Executive Officer of Colorado River DevCo LP, a Delaware limited partnership.

WITNESS my hand and official seal.

My commission expires: 05/05/2018

 

/s/ Joanne Garner

Notary Public

 

Agreement Addendum 01 – Signature Page 2

Third Amended and Restated Crude Oil Treating Agreement

Exhibit 10.10.2

TERMS IN THIS EXHIBIT HAVE BEEN REDACTED BECAUSE CONFIDENTIAL TREATMENT FOR THOSE TERMS HAS BEEN REQUESTED. THE REDACTED MATERIAL HAS BEEN FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION, AND THE TERMS HAVE BEEN MARKED AT THE APPROPRIATE PLACE WITH TWO BRACKETED ASTERISKS [**].

THIRD AMENDED AND RESTATED

CRUDE OIL TREATING AGREEMENT

THIRD AMENDED AND RESTATED

AGREEMENT ADDENDUM 02

B RIGGSDALE F ACILITY

C ONTRACT N UMBER : CRALL1-OT

This THIRD AMENDED AND RESTATED AGREEMENT ADDENDUM 02 (this “ Agreement Addendum ”) (a) shall be effective as between the Persons named below as “Producer” and “Midstream Co” as of the date specified below as the “Effective Date,” (b) incorporates the Third Amended and Restated Agreement Terms and Conditions Relating to Crude Oil Treating Services (the “ Agreement Terms and Conditions ”), which were last amended effective as of March 31, 2016, and (c) together with the Agreement Terms and Conditions, shall constitute one contract and shall be the Agreement of the Parties. Except as otherwise set forth herein (i) all terms shall have the meanings assigned to such terms in the Agreement Terms and Conditions and (ii) all references to Exhibits, Appendices, Articles, Sections, subsections and other subdivisions refer to the corresponding Exhibits, Appendices, Articles, Sections, subsections and other subdivisions of or to the Agreement Terms and Conditions.

Producer desires to contract with Midstream Co for Midstream Co to provide the Services utilizing the Individual System, and Midstream Co desires to provide the Services to Producer, on the terms and subject to the conditions of this Agreement.

NOW, THEREFORE, in consideration of the mutual agreements in this Agreement, Midstream Co and Producer hereby agree as follows:

 

Producer

   Noble Energy, Inc., a Delaware corporation

Midstream Co

   Colorado River DevCo LP, a Delaware limited partnership

Individual System

   This Agreement Addendum pertains only to Services provided by Midstream Co at the oil treating facility known by Midstream Co as the Briggsdale Facility.

Parties

   The term “Party” or “Parties” shall refer to Producer and the Midstream Co identified in this Agreement Addendum

Effective Date

   March 31, 2016

Dedication Area

   Weld County, Colorado and surrounding counties, less and except those leases were released pursuant to a Release of Dedication.

 

Agreement Addendum 02 –Page 1

Third Amended and Restated Crude Oil Treating Agreement


TERMS IN THIS EXHIBIT HAVE BEEN REDACTED BECAUSE CONFIDENTIAL TREATMENT FOR THOSE TERMS HAS BEEN REQUESTED. THE REDACTED MATERIAL HAS BEEN FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION, AND THE TERMS HAVE BEEN MARKED AT THE APPROPRIATE PLACE WITH TWO BRACKETED ASTERISKS [**].

 

Individual

Horizontal Fee

   $[**]/Relevant Well

Individual Vertical

Fee

   $[**]/Relevant Well

 

Additional Revisions
Section 6.1    At all times that Midstream Co is party to both Agreement Addendum 01 and Agreement Addendum 02, Producer shall be charged a total (in the aggregate across both Agreements) of $[**]/ Relevant Well that is horizontal and $[**]/ Relevant Well that is vertical. If Midstream Co is not a party to both Agreement Addendum 01 and Agreement Addendum 02, Midstream Co and Producer shall negotiate an equitable price adjustment for the provision of Services.

 

Notices and Payments

Notice Address –

General Matters &

Correspondence

   Midstream Co and Producer shall deliver appropriate contact information to the other Party in writing.

 

Notice Address –

Operational Matters

  

 

Notice Address – Force

Majeure and Marketing

interruptions

  

 

Notice Address –

Invoicing Matters

  

 

Marketing Notice –

Midstream Co

  

 

Payments by Electronic

Funds Transfer

  

 

Midstream Co and Producer shall deliver appropriate contact information to the other Party in writing

(End of Agreement Addendum 02)

 

Agreement Addendum 02 –Page 2

Third Amended and Restated Crude Oil Treating Agreement


TERMS IN THIS EXHIBIT HAVE BEEN REDACTED BECAUSE CONFIDENTIAL TREATMENT FOR THOSE TERMS HAS BEEN REQUESTED. THE REDACTED MATERIAL HAS BEEN FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION, AND THE TERMS HAVE BEEN MARKED AT THE APPROPRIATE PLACE WITH TWO BRACKETED ASTERISKS [**].

 

IN WITNESS WHEREOF, the Parties hereto have executed this Agreement in duplicate originals to be effective as of the Effective Date.

 

“Producer”

NOBLE ENERGY, INC.

 

By:

 

/s/ Gary W. Willingham

    Gary W. Willingham
    Executive Vice President

 

STATE OF TEXAS                )
               )   ss.
COUNTY OF HARRIS                )

The foregoing instrument was acknowledged before me this 29th day of August 2016, by Gary W. Willingham as Executive Vice President of Noble Energy, Inc., a Delaware corporation.

WITNESS my hand and official seal.

My commission expires: 05/05/2018

 

/s/ Joanne Garner

Notary Public

 

Agreement Addendum 02 – Signature Page 1

Third Amended and Restated Crude Oil Treating Agreement


TERMS IN THIS EXHIBIT HAVE BEEN REDACTED BECAUSE CONFIDENTIAL TREATMENT FOR THOSE TERMS HAS BEEN REQUESTED. THE REDACTED MATERIAL HAS BEEN FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION, AND THE TERMS HAVE BEEN MARKED AT THE APPROPRIATE PLACE WITH TWO BRACKETED ASTERISKS [**].

 

“Midstream Co”

COLORADO RIVER DEVCO LP

  By:   Colorado River DevCo GP LLC
                    By:   Noble Midstream Services, LLC
By:  

/s/ Terry R. Gerhart

 
  Terry R. Gerhart  
  Chief Executive Officer

 

STATE OF TEXAS                )
               )   ss.
COUNTY OF HARRIS                )

The foregoing instrument was acknowledged before me this 25th day of August 2016, by Terry R. Gerhart as Chief Executive Officer of Colorado River DevCo LP, a Delaware limited partnership.

WITNESS my hand and official seal.

My commission expires: 05/05/2018

 

/s/ Joanne Garner

Notary Public

 

Agreement Addendum 02 – Signature Page 2

Third Amended and Restated Crude Oil Treating Agreement

Exhibit 10.12.3

Execution Version

When Recorded, Mail To:

Attn: DJ Land Manager

1625 Broadway, Suite 2200

Denver, CO 80202

AMENDMENT 01

TO

THAT CERTAIN

SECOND AMENDED AND RESTATED

PRODUCED WATER SERVICES AGREEMENT

W ELLS R ANCH

C ONTRACT N UMBER : CRWR01-PW

This AMENDMENT 01 (this “ Amendment ”) shall be effective among Noble Energy, Inc., a Delaware corporation (the “ Producer ”) and Colorado River DevCo LP, a Delaware limited partnership, together with its permitted successors and assigns (“ Midstream Co ”) as of September 1, 2016 (the “Amendment Effective Time”). This Amendment modifies that certain Second Amended and Restated Produced Water Services Agreement, effective as of March 31, 2016 (the “ Agreement ”), which has been given contract number CRWR01-PW and is comprised of (i) that certain Second Amended and Restated Agreement Terms and Conditions Relating to Produced Water Services (the “ Agreement Terms and Conditions ”), last updated March 31, 2016, together with (ii) that certain Second Amended and Restated Agreement Addendum 01 (the “ Agreement Addendum ”), effective as of March 31, 2016. The Agreement Terms and Conditions, the Agreement Addendum and this Amendment shall constitute one contract and shall be the Agreement of the Parties.

WHEREAS, capitalized terms used herein have the meanings assigned to such terms in the Agreement Terms and Conditions.

WHEREAS, pursuant to Section 2.1 of the Agreement Terms and Conditions, Producer has dedicated and committed to deliver to Midstream Co under the Agreement, as and when produced, all of the Dedicated Production and agreed not to deliver any Dedicated Production to any other gatherer, purchaser, or other Person prior to delivery to Midstream Co at the Receipt Points.

WHEREAS, at certain times prior to or after connection of the Individual System to a particular Well or Separator Facility, the Individual System may not be available to accept deliveries of Dedicated Production.

WHEREAS, during such times, Producer remains obligated to deliver the Dedicated Production to Midstream Co and Midstream Co remains obligated to arrange for the disposal of such Dedicated Production, and the Parties desire to amend the Agreement to provide for the flexibility required.


WHEREAS, the Parties agree and acknowledge that amendments to the Agreement Terms and Conditions set forth herein constitute an amendment only to the Agreement and not to any other agreement in respect of produced water services to which Producer or Midstream Co is a party.

NOW, THEREFORE, in consideration of the foregoing recitals, which are incorporated herein and the mutual agreements in the Agreement, Midstream Co and Producer hereby agree as follows:

1. Amendments to Article 1 .

1.1 The following defined terms are hereby amended and restated in their entirety to read as follows:

Facility Segment ” means each segment of an Individual System comprised of facilities beginning at a Receipt Point and ending at an Internal Transfer Point. If an Individual System does not contain any such distinct segment, then the term Facility Segment shall be synonymous with Individual System.

Individual Fee ” means the aggregate of the Individual First Phase Fee, the Individual Second Phase Fee and the Individual Disposal by Truck Fee; provided that for purposes of the annual escalation in the Individual Fee described in Section 6.2(b) , such term shall not include any Reimbursed Amount.

Individual Second Phase Fee ” means the Monthly fee for providing Second Phase Services at a particular Individual System, as set forth opposite the heading “Individual Second Phase Fee” on the applicable Midstream Agreement Addendum; provided that the Individual Second Phase Fee shall accrue only with respect to Services performed by Midstream Co on Product flowing through an Individual System.

Individual System ” means the portion of the System beginning at the Receipt Points and ending at the Delivery Points. The Individual Systems in existence on the Effective Date are more particularly described in writing between Producer and Midstream Co. Additional Individual Systems may be added to the System from time to time in satisfaction of the needs identified by Producer and evidenced in writing between Producer and Midstream Co.

Other System Fuel ” means any natural gas delivered into Midstream Co’s custody by Producer pursuant to a Transaction Document between Producer and Midstream Co and measured and used as fuel by Midstream Co.

1.2 The defined terms “Drip Condensate”, “Gas”, “Gas System”, “Individual Second Phase Rate”, and “Other Services” are hereby deleted.

1.3 Clauses (a) and (b) of the defined term “Dedicated Production” are hereby amended and restated to read as follows: “(a) Product owned by Producer or an Affiliate of Producer and produced from a Well within the Dedication Area that is operated by Producer or an Affiliate under the Control of Producer, (b)  Reserved , and”.

 

Amendment 01 – Page 2

Second Amended and Restated Produced Water Services Agreement

Colorado River Produced Water Agreement

CRWR01-PW


1.4 The defined term “Product” is hereby amended by inserting the following sentence at the end of such definition:

“In the event Producer exercises its Trucking Election, the term “Product” shall refer to all water that is accepted for delivery at a SWD Trucking Facility for the account of Midstream Co.”

1.5 The defined term “Services” is hereby amended by deleting “and (g)” at the end of clause (f) and inserting in place thereof the following: “, (g) Trucked Water Services and (h)”.

1.6 The following new definitions shall be added to Article 1 in alphabetical order:

Approved SWD Vendor ” means Midstream Co or a Third Party, in either case, as mutually agreed in writing by the Parties; provided, however, that if an Approved SWD Vendor rejects any Product delivered to a SWD Trucking Facility for quality or safety reasons, then Midstream Co shall be entitled to select an alternative vendor to take title to, store, handle, and dispose of such Product without obtaining Producer’s approval of such vendor, and such vendor shall be deemed an Approved SWD Vendor for such purpose.

Individual Disposal by Truck Fee ” means the Monthly fee for providing Trucked Water Services with respect to Dedicated Production delivered to a SWD Trucking Facility, as set forth opposite the heading “Individual Disposal by Truck Fee” on the applicable Midstream Agreement Addendum; provided that the Individual Disposal by Truck Fee shall accrue only with respect to Dedicated Production delivered by truck to a SWD Trucking Facility.

Pipeline Unavailability ” means any time after the Trucked Water Services Commencement Date during which the Individual System is not capable of accepting or transporting volumes of Product for any reason, including Pre-Connection Water that exceeds the capacity of the Individual System, Pre-Connection Water at a time when the Individual System is not yet online, curtailments on the Individual System and interruptions of Service.

Pre-Connection Water ” means the water-based solution that flows back to the surface during and after the completion of hydraulic fracturing a Well.

Pre-Connection Period ” means, with respect to a Well, the period of time commencing on the Day Pre-Connection Water begins to return to the surface and ending on the earlier of the date (a) on which such Well or the Separator Facility to which such Well is connected is connected to the Individual System or (b) that is 10 Days following the first Day of the applicable Pre-Connection Period.

 

Amendment 01 – Page 3

Second Amended and Restated Produced Water Services Agreement

Colorado River Produced Water Agreement

CRWR01-PW


SWD Trucking Facility ” means an Approved SWD Vendor’s saltwater disposal well that Midstream Co has designated for disposal of Dedicated Production that is transported by truck.

Transporter ” means a wastewater truck transportation company engaged by Producer or Midstream Co, as applicable, to transport Trucked Volumes to the SWD Trucking Facility.

Trucked Volumes ” has the meaning given to it in Section 18.3(a) .

Trucked Water Services ” means, at any time when Producer has exercised its Trucking Election, Midstream Co shall make arrangements for the disposal of Dedicated Production that arrives by truck at the applicable SWD Trucking Facility. In addition, in connection with a Trucking Election, (a) during a Pre-Connection Period, if Producer requests and Midstream Co agrees, then with Producer’s reasonable cooperation, Midstream Co will arrange for the dispatching of the applicable trucks to the applicable SWD Trucking Facility and otherwise coordinate the water hauling trucks and (b) at all other times during a Pipeline Unavailability in which Producer has made a Trucking Election, Midstream Co shall arrange for the dispatching of the applicable trucks to the applicable SWD Trucking Facility and otherwise coordinate the water hauling trucks.

Trucked Water Services Commencement Date ” has the meaning given to it in Section 2.3(b).

Trucking Election ” has the meaning given to it in Section 2.3(b) .

2. Amendments to Article 2 .

2.1 Section 2.3(b) of the Agreement Terms and Conditions is hereby amended and restated in its entirety to read: “(b) following the date set forth in writing between Producer and Midstream Co (such date as it may be updated by Midstream Co and Producer, the “ Trucked Water Services Commencement Date ”), Producer may elect to deliver or have delivered Dedicated Production directly to a SWD Trucking Facility during any Pipeline Unavailability as provided in Section 18.2 (the “ Trucking Election ”); and”.

2.2 Section 2.3(d) of the Agreement Terms and Conditions is hereby amended and restated in its entirety to read: “(d) to pool, communitize or unitize Producer’s interests with respect to Dedicated Production”.

2.3 Section 2.4(b)(iv) of the Agreement Terms and Conditions is amended and restated in its entirety to read: “(iv) Reserved. ”.

3. Amendments to Article 3 .

3.1 Section 3.1(e) of the Agreement Terms and Conditions is hereby amended by deleting the sentence that reads as follows “In the sole discretion of each Person serving as a Midstream Co under a Midstream Agreement Addendum, such Midstream Co may work with

 

Amendment 01 – Page 4

Second Amended and Restated Produced Water Services Agreement

Colorado River Produced Water Agreement

CRWR01-PW


any other Midstream Co to prepare and deliver a System Plan jointly.” and inserting in place thereof the following sentence: “Midstream Co may, in its sole discretion, work with OpCo or any of OpCo’s subsidiaries to prepare and deliver a System Plan jointly with such other entity or entities.”

3.2 Section 3.2 of the Agreement Terms and Conditions is hereby amended by inserting the following new clause (e)  immediately following clause (d)  of such Section 3.2 :

“(e) Substation and Interconnection Facilities . The obligations of Midstream Co hereunder to design and construct the Individual System and to perform the Services do not include the design or construction of any substation or other interconnecting facilities required to procure electricity for the Individual System. If a substation or any other interconnecting facility is required in order for Midstream Co to perform its obligations hereunder, Midstream Co and Producer shall enter into a separate agreement setting forth each Party’s responsibilities in connection therewith, including an allocation of responsibility for all associated costs and expenses.”

4. Amendments to Article 6 .

4.1 Clause (ii) of Section 6.1 of the Agreement Terms and Conditions is hereby amended and restated in its entirety to read as follows: “(ii) the Individual Second Phase Fee, if any, applicable to Second Phase Services performed within the Dedication Area,”

4.2 Section 6.1 of the Agreement Terms and Conditions is further amended by deleting the period at the end of such Section 6.1 and inserting in place thereof the following clause: “and (iv) the Individual Disposal by Truck Fee, if any.”

4.3 Section 6.3(d) of the Agreement Terms and Conditions is hereby amended and restated in its entirety to read as follows: “ Other System Fuel . Midstream Co may elect to use Other System Fuel as fuel to operate the Individual System, or to generate electricity for the operation of the Individual System and shall account for any Other System Fuel used by Midstream Co. Producer, at its sole cost and expense, shall procure all fuel, in addition to Other System Fuel used by Midstream Co, if any, required to operate the Individual System or to generate electricity for the operation of the Individual System and arrange for transportation of such fuel to the Individual System.”.

5. Amendments to Article 8 . Clause (d) of Section 8.2 of the Agreement Terms and Conditions is hereby amended by deleting the phrase “and Section 17.11 shall” and inserting in place thereof the clause: “, Section 17.11 and Section 18.7 shall”.

 

Amendment 01 – Page 5

Second Amended and Restated Produced Water Services Agreement

Colorado River Produced Water Agreement

CRWR01-PW


6. New Article 18 . The following new Article 18 shall be inserted immediately following the conclusion of Article 17 of the Agreement Terms and Conditions:

Article 18

Pipeline Unavailability

Section 18.1 Effectiveness; Pipeline Unavailability . The Parties agree that this Article 18 shall be effective as of the Trucked Water Services Commencement Date.

(a) It is the intention of the Parties to use the Individual System for all Dedicated Production. To accommodate operational upsets and periods of increased flow (such as the occurrence of Pre-Connection Water during the Pre-Connection Period), the Parties have agreed under Section 2.3(b) that, during Pipeline Unavailability, Producer shall elect to either (i) exercise the Trucking Election or (ii) cease producing Dedicated Production until the end of the Pipeline Unavailability, as provided in Section 18.2 . To the extent Producer exercises its Trucking Election, this Article 18 shall govern with respect to the Trucked Volumes and the other matters set forth herein, rather than Articles 4 , 7 (other than Section 7.3 as it applies to Trucked Volumes delivered to a SWD Trucking Facility that fail to meet the quality requirements of Section 18.3(d)) and 9 and Sections 5.1 , 5.2 , 5.3 , 5.4 , and 5.6 .

(b) The Parties agree that during Pipeline Unavailability, Producer shall not have the right to temporary services under Sections 3.3(a) and 3.3(b) of the Agreement or to a temporary release under Section 2.4(b)(ii) of the Agreement except to the extent that Midstream Co fails to provide Trucked Water Services.

(c) If Midstream Co fails to connect a Well or a Separator Facility to the Individual System by the On-Line Deadline, Producer may exercise its Trucking Election for the duration of the resulting Pipeline Unavailability, rather than exercising its right to a permanent release under Section 2.4(a)(i) and Section 2.4(a)(ii) . If Midstream Co fails to connect a Well or Separator Facility to the Individual System by the On-Line Deadline, but prior to such On-Line Deadline, the Parties have agreed that the connection of the Well or Separator Facility did not need to occur until after Pre-Connection Water has started flowing, then the resulting Pipeline Unavailability shall not entitle Producer to a permanent release under Section 2.4(a)(i) and Section 2.4(a)(ii) until such time as the agreed upon connection date has passed.

Section 18.2 Exercise of Trucking Election .

(a) If Producer expects a Well or Separator Facility to be completed prior to its connection to the Individual System, resulting in a Pipeline Unavailability, Producer shall give Midstream Co at least 72 hours’ advance notice that Dedicated Production is expected to be produced from the applicable Well or available at the applicable Separator Facility. After the applicable Well or

 

Amendment 01 – Page 6

Second Amended and Restated Produced Water Services Agreement

Colorado River Produced Water Agreement

CRWR01-PW


Separator Facility is connected to the Individual System, following the Trucked Water Services Commencement Date, Midstream Co shall deliver notice to Producer of any Pipeline Unavailability pursuant to Section 5.5 .

(b) Once Producer or Midstream Co, as applicable, has delivered notice to the other Party that a Pipeline Unavailability is expected (or has occurred), Producer will inform Midstream Co whether Producer elects to exercise its Trucking Election or to cease producing Dedicated Production until the end of the Pipeline Unavailability. If Producer exercises the Trucking Election during the Pre-Connection Period, Producer shall coordinate with the water hauling trucks and arrange for transportation of the Dedicated Production to the SWD Trucking Facility at its sole cost and expense until the end of the Pre-Connection Period. At all other times during a Pipeline Unavailability, including when Pre-Connection Water is occurring after the expiration of the Pre-Connection Period, Midstream Co shall coordinate with the water hauling trucks and arrange for transportation of the Dedicated Production to the SWD Trucking Facility as part of the Trucked Water Services unless Producer has elected to cease producing Dedicated Production.

Section 18.3 Delivery of and Title to Trucked Volumes .

(a) Trucked Water Services Obligation . Upon the exercise of a Trucking Election, Midstream Co shall cause an Approved SWD Vendor to accept delivery of, take title to, store, handle and dispose of Dedicated Production that is delivered by truck to a SWD Trucking Facility. Upon the exercise of a Trucking Election, Midstream Co may, in its sole discretion, also accept delivery of, take title to, store, handle and dispose of other Product delivered by truck to a SWD Trucking Facility. The volumes that are actually delivered by truck shall be referred to as “Trucked Volumes”.

(b) Consistent Volumes . The Trucked Volumes delivered to the applicable SWD Trucking Facility shall be at a rate of delivery that is as uniform as reasonably possible in accordance with Producer’s drilling, completion, and frac schedule.

(c) Title and Custody . Title to and risk of loss to the Trucked Volumes and all contents thereof shall pass from Producer to Approved SWD Vendor when delivered into Approved SWD Vendor’s storage tanks at the SWD Trucking Facility, unless the Parties otherwise agree in writing.

(d) Quality . Producer represents and warrants that all Trucked Volumes delivered to an Approved SWD Vendor may lawfully be disposed of in Class II disposal wells. Midstream Co’s performance of Trucked Water Services for any Trucked Volumes that do not meet such requirement shall not relieve Producer from any liability for Producer’s breach of the foregoing representation and warranty nor serve as a waiver of any rights or remedies available to Midstream Co therefor.

 

Amendment 01 – Page 7

Second Amended and Restated Produced Water Services Agreement

Colorado River Produced Water Agreement

CRWR01-PW


(e) Prohibition on Skimming . The Party that coordinates the water hauling trucks shall direct the Transporter not to skim, transfer, sell, or otherwise remove hydrocarbons or Trucked Volumes from trucks after receipt by such Transporter and prior to such Trucked Volumes being received by the Approved SWD Vendor. If the Approved SWD Vendor alleges that the Trucked Volumes delivered appear to have been handled in a manner inconsistent with the foregoing sentence, Producer shall corporate with Midstream Co and the Approved SWD Vendor in a review and analysis and, if required by the Approved SWD Vendor, take corrective action in a timely manner. If Transporters engaged by Producer fail to comply with the directions received, then Midstream Co may direct Producer to use a different Transporter.

Section 18.4 Unavailability of a SWD Trucking Facility . If for any reason there is a disruption of receipts at the SWD Trucking Facility, the Parties shall work in good faith to find a mutually agreeable resolution. If for any reason Midstream Co receives reimbursements in respect of trucking as a result of an originally scheduled SWD Trucking Facility being unable to accept deliveries, Midstream Co shall disclose such reimbursements on the applicable invoice and pass through such reimbursements to Producer if Producer paid the costs of the applicable Transporter directly.

Section 18.5 Testing; Non-Conforming Product . If requested by Midstream Co, Producer shall obtain water samples for analyses and retain appropriate qualified personnel to conduct analyses following methodologies considered appropriate in the industry or shall permit Midstream Co to obtain such samples.

Section 18.6 Producer’s Grant of Access . Producer hereby grants to Midstream Co, and shall grant to each Transporter, without warranty of title, either express or implied, to the extent that it may lawfully and is contractually permitted to do so without the incurrence of additional expense, the rights of ingress and egress with respect to, and the right to access, all lands constituting Dedicated Properties for the purposes of (a) transporting Trucked Volumes, and (b) obtaining water samples as described in Section 18.5 .

Section 18.7 Information . Producer agrees that information it supplies to Midstream Co regarding anticipated volumes of Dedicated Production and Trucked Volumes may be shared with an Approved SWD Vendor to the extent required by the applicable Approved SWD Vendor to assist in planning and operations, and Producer agrees to provide additional information regarding anticipated volumes of Dedicated Production and Trucked Volumes to the extent requested by Midstream Co in response to inquiries from an Approved SWD Vendor (so long as Midstream Co is required to deliver the requested information in order to comply with Midstream Co’s contractual arrangements with such Approved SWD Vendor). Under Section 3.1 , Midstream Co has the right to hold certain meetings with Producer, and at the request of Midstream Co, one of such meetings per year may be held in conjunction with the Approved SWD Vendor to discuss confer regarding planned activities.

Section 18.8 Indemnification in Respect of Trucked Volumes . Without in any way limiting any indemnification obligation otherwise set forth in the Agreement, the Parties agree that the indemnification obligations of Producer set forth in Section 7.3 and Section 15.2(b) apply to Trucked Volumes delivered to a SWD Trucking Facility.

 

Amendment 01 – Page 8

Second Amended and Restated Produced Water Services Agreement

Colorado River Produced Water Agreement

CRWR01-PW


Section 18.9 Invoices from Approved SWD Vendor . The Party that engages the Transporter shall take all reasonable measures to ensure that the invoicing procedures that Midstream Co has negotiated with the Approved SWD Vendor are used, including notation of the geographic area to which the services pertain. Midstream Co shall provide a written copy of such procedures to Producer upon request.

7. Amendments to Agreement Addendum .

7.1 The specifications regarding the “Individual Second Phase Rate” appearing in the Agreement Addendum are hereby amended and restated in their entirety and the specifications regarding the “Individual Disposal By Truck Fee” are hereby added to the Agreement Addendum as follows:

 

   Individual Second Phase Fee  

An amount equal to the actual costs incurred by Midstream Co for providing the Second Phase Services multiplied by 1.05.

 

  
   Individual Disposal by Truck Fee  

An amount equal to the actual costs incurred by Midstream Co for providing the Trucked Water Services with respect to Dedicated Production delivered to a SWD Trucking Facility multiplied by 1.05.

 

  

8. Confidentiality . Pursuant to Section 17.11 of the Agreement (which appears in the Agreement Terms and Conditions), the Parties have agreed to treat the information exchanged in connection with and the provisions of the Agreement as confidential. In addition, confidential treatment has been requested with the Securities and Exchange Commission for the pricing terms of the Agreement and the Parties agree to take appropriate measures to abide by the requirements imposed by the Securities and Exchange Commission to preserve such confidential treatment, if granted.

9. Confirmation . The provisions of the Agreement, as amended by this Amendment, shall remain in full force and effect following the effectiveness of this Amendment. No provision of the Agreement is amended or otherwise modified hereby, except as expressly stated herein.

10. No Waiver . The execution, delivery and effectiveness of this Amendment shall not operate as a waiver of any right, power or remedy of any Party to the Agreement, nor constitute a waiver of any provision of the Agreement. On and after the Amendment Effective Time, this Amendment shall for all purposes constitute a part of the Agreement.

11. Counterparts . This Amendment may be executed in any number of counterparts, and each such counterpart hereof shall be deemed to be an original instrument, but all of such counterparts shall constitute for all purposes one agreement. Any signature hereto delivered by a Party by electronic mail shall be deemed an original signature hereto.

 

Amendment 01 – Page 9

Second Amended and Restated Produced Water Services Agreement

Colorado River Produced Water Agreement

CRWR01-PW


12. Governing Law . This Amendment shall be governed by and construed in accordance with the laws of the State, excluding any conflicts of law rule or principle that might refer construction of such provisions to the laws of another jurisdiction.

(Signature Pages follow)

 

Amendment 01 – Page 10

Second Amended and Restated Produced Water Services Agreement

Colorado River Produced Water Agreement

CRWR01-PW


IN WITNESS WHEREOF, the Parties hereto have executed this Amendment to the Agreement in duplicate originals to be effective as of the Amendment Effective Time.

 

“Producer”
NOBLE ENERGY, INC.
By:  

/s/ Gary W. Willingham

  Gary W. Willingham
  Executive Vice President

STATE OF TEXAS                    )

                                                     ) ss.

COUNTY OF HARRIS              )

The foregoing instrument was acknowledged before me this 29th day of August 2016, by Gary W. Willingham as Executive Vice President of Noble Energy, Inc., a Delaware corporation.

WITNESS my hand and official seal.

My commission expires: 05/05/2018

 

/s/ Joanne Garner
Notary Public

 

Amendment 01 – Signature Page 1

Second Amended and Restated Produced Water Services Agreement

Colorado River Produced Water Agreement

CRWR01-PW


“Midstream Co”

COLORADO RIVER DEVCO LP

  By: Colorado River DevCo GP LLC
       By: Noble Midstream Services, LLC
                     By:   /s/ Terry R. Gerhart                        
                             Terry R. Gerhart
                             Chief Executive Officer

STATE OF TEXAS                    )

                                                     ) ss.

COUNTY OF HARRIS              )

The foregoing instrument was acknowledged before me this 25th day of August 2016, by Terry R. Gerhart as Chief Executive Officer of Noble Midstream Services, LLC, which is the sole member of Colorado River DevCo GP LLC, which is the general partner of Colorado River DevCo LP, a Delaware limited partnership.

WITNESS my hand and official seal.

My commission expires: 05/05/2018

 

/s/ Joanne Garner
Notary Public

 

Amendment 01 – Signature Page 2

Second Amended and Restated Produced Water Services Agreement

Colorado River Produced Water Agreement

CRWR01-PW

Exhibit 10.13.2

Execution Version

When Recorded, Mail To:

Attn: DJ Land Manager

1625 Broadway, Suite 2200

Denver, CO 80202

AMENDMENT 01

TO

THAT CERTAIN

SECOND AMENDED AND RESTATED

PRODUCED WATER SERVICES AGREEMENT

N ORTHERN C OLORADO

C ONTRACT N UMBER : SJNC02-PW

This AMENDMENT 01 (this “ Amendment ”) shall be effective among Noble Energy, Inc., a Delaware corporation (the “ Producer ”) and San Juan River DevCo LP, a Delaware limited partnership, together with its permitted successors and assigns (“ Midstream Co ”) as of September 1, 2016 (the “ Amendment Effective Time ”). This Amendment modifies that certain Second Amended and Restated Produced Water Services Agreement, effective as of March 31, 2016 (the “ Agreement ”), which has been given contract number SJNC02-PW and is comprised of (i) that certain Second Amended and Restated Agreement Terms and Conditions Relating to Produced Water Services (the “ Agreement Terms and Conditions ”), last updated March 31, 2016, together with (ii) that certain Second Amended and Restated Agreement Addendum 02 (the “ Agreement Addendum ”), effective as of March 31, 2016. The Agreement Terms and Conditions, the Agreement Addendum and this Amendment shall constitute one contract and shall be the Agreement of the Parties.

WHEREAS, capitalized terms used herein have the meanings assigned to such terms in the Agreement Terms and Conditions.

WHEREAS, pursuant to Section 2.1 of the Agreement Terms and Conditions, Producer has dedicated and committed to deliver to Midstream Co under the Agreement, as and when produced, all of the Dedicated Production and agreed not to deliver any Dedicated Production to any other gatherer, purchaser, or other Person prior to delivery to Midstream Co at the Receipt Points.

WHEREAS, at certain times prior to or after connection of the Individual System to a particular Well or Separator Facility, the Individual System may not be available to accept deliveries of Dedicated Production.

WHEREAS, during such times, Producer remains obligated to deliver the Dedicated Production to Midstream Co and Midstream Co remains obligated to arrange for the disposal of such Dedicated Production, and the Parties desire to amend the Agreement to provide for the flexibility required.


WHEREAS, the Parties agree and acknowledge that amendments to the Agreement Terms and Conditions set forth herein constitute an amendment only to the Agreement and not to any other agreement in respect of produced water services to which Producer or Midstream Co is a party.

NOW, THEREFORE, in consideration of the foregoing recitals, which are incorporated herein and the mutual agreements in the Agreement, Midstream Co and Producer hereby agree as follows:

1. Amendments to Article 1 .

1.1 The following defined terms are hereby amended and restated in their entirety to read as follows:

Facility Segment ” means each segment of an Individual System comprised of facilities beginning at a Receipt Point and ending at an Internal Transfer Point. If an Individual System does not contain any such distinct segment, then the term Facility Segment shall be synonymous with Individual System.

Individual Fee ” means the aggregate of the Individual First Phase Fee, the Individual Second Phase Fee and the Individual Disposal by Truck Fee; provided that for purposes of the annual escalation in the Individual Fee described in Section 6.2(b) , such term shall not include any Reimbursed Amount.

Individual Second Phase Fee ” means the Monthly fee for providing Second Phase Services at a particular Individual System, as set forth opposite the heading “Individual Second Phase Fee” on the applicable Midstream Agreement Addendum; provided that the Individual Second Phase Fee shall accrue only with respect to Services performed by Midstream Co on Product flowing through an Individual System.

Individual System ” means the portion of the System beginning at the Receipt Points and ending at the Delivery Points. The Individual Systems in existence on the Effective Date are more particularly described in writing between Producer and Midstream Co. Additional Individual Systems may be added to the System from time to time in satisfaction of the needs identified by Producer and evidenced in writing between Producer and Midstream Co.

Other System Fuel ” means any natural gas delivered into Midstream Co’s custody by Producer pursuant to a Transaction Document between Producer and Midstream Co and measured and used as fuel by Midstream Co.

1.2 The defined terms “Drip Condensate”, “Gas”, “Gas System”, “Individual Second Phase Rate”, and “Other Services” are hereby deleted.

1.3 Clauses (a) and (b) of the defined term “Dedicated Production” are hereby amended and restated to read as follows: “(a) Product owned by Producer or an Affiliate of Producer and produced from a Well within the Dedication Area that is operated by Producer or an Affiliate under the Control of Producer, (b)  Reserved , and”.

 

Amendment 01 – Page 2

Second Amended and Restated Produced Water Services Agreement

San Juan River Produced Water Agreement

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1.4 The defined term “Product” is hereby amended by inserting the following sentence at the end of such definition:

“In the event Producer exercises its Trucking Election, the term “Product” shall refer to all water that is accepted for delivery at a SWD Trucking Facility for the account of Midstream Co.”

1.5 The defined term “Services” is hereby amended by deleting “and (g)” at the end of clause (f) and inserting in place thereof the following: “, (g) Trucked Water Services and (h)”.

1.6 The following new definitions shall be added to Article 1 in alphabetical order:

Approved SWD Vendor ” means Midstream Co or a Third Party, in either case, as mutually agreed in writing by the Parties; provided, however, that if an Approved SWD Vendor rejects any Product delivered to a SWD Trucking Facility for quality or safety reasons, then Midstream Co shall be entitled to select an alternative vendor to take title to, store, handle, and dispose of such Product without obtaining Producer’s approval of such vendor, and such vendor shall be deemed an Approved SWD Vendor for such purpose.

Individual Disposal by Truck Fee ” means the Monthly fee for providing Trucked Water Services with respect to Dedicated Production delivered to a SWD Trucking Facility, as set forth opposite the heading “Individual Disposal by Truck Fee” on the applicable Midstream Agreement Addendum; provided that the Individual Disposal by Truck Fee shall accrue only with respect to Dedicated Production delivered by truck to a SWD Trucking Facility.

Pipeline Unavailability ” means any time after the Trucked Water Services Commencement Date during which the Individual System is not capable of accepting or transporting volumes of Product for any reason, including Pre-Connection Water that exceeds the capacity of the Individual System, Pre-Connection Water at a time when the Individual System is not yet online, curtailments on the Individual System and interruptions of Service.

Pre-Connection Water ” means the water-based solution that flows back to the surface during and after the completion of hydraulic fracturing a Well.

Pre-Connection Period ” means, with respect to a Well, the period of time commencing on the Day Pre-Connection Water begins to return to the surface and ending on the earlier of the date (a) on which such Well or the Separator Facility to which such Well is connected is connected to the Individual System or (b) that is 10 Days following the first Day of the applicable Pre-Connection Period.

 

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SWD Trucking Facility ” means an Approved SWD Vendor’s saltwater disposal well that Midstream Co has designated for disposal of Dedicated Production that is transported by truck.

Transporter ” means a wastewater truck transportation company engaged by Producer or Midstream Co, as applicable, to transport Trucked Volumes to the SWD Trucking Facility.

Trucked Volumes ” has the meaning given to it in Section 18.3(a) .

Trucked Water Services ” means, at any time when Producer has exercised its Trucking Election, Midstream Co shall make arrangements for the disposal of Dedicated Production that arrives by truck at the applicable SWD Trucking Facility. In addition, in connection with a Trucking Election, (a) during a Pre-Connection Period, if Producer requests and Midstream Co agrees, then with Producer’s reasonable cooperation, Midstream Co will arrange for the dispatching of the applicable trucks to the applicable SWD Trucking Facility and otherwise coordinate the water hauling trucks and (b) at all other times during a Pipeline Unavailability in which Producer has made a Trucking Election, Midstream Co shall arrange for the dispatching of the applicable trucks to the applicable SWD Trucking Facility and otherwise coordinate the water hauling trucks.

Trucked Water Services Commencement Date ” has the meaning given to it in Section 2.3(b).

Trucking Election ” has the meaning given to it in Section 2.3(b) .

2. Amendments to Article 2 .

2.1 Section 2.3(b) of the Agreement Terms and Conditions is hereby amended and restated in its entirety to read: “(b) following the date set forth in writing between Producer and Midstream Co (such date as it may be updated by Midstream Co and Producer, the “Trucked Water Services Commencement Date”), Producer may elect to deliver or have delivered Dedicated Production directly to a SWD Trucking Facility during any Pipeline Unavailability as provided in Section 18.2 (the “ Trucking Election ”); and”.

2.2 Section 2.3(d) of the Agreement Terms and Conditions is hereby amended and restated in its entirety to read: “(d) to pool, communitize or unitize Producer’s interests with respect to Dedicated Production”.

2.3 Section 2.4(b)(iv) of the Agreement Terms and Conditions is amended and restated in its entirety to read: “(iv) Reserved. ”.

3. Amendments to Article 3 .

3.1 Section 3.1(e) of the Agreement Terms and Conditions is hereby amended by deleting the sentence that reads as follows “In the sole discretion of each Person serving as a Midstream Co under a Midstream Agreement Addendum, such Midstream Co may work with

 

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any other Midstream Co to prepare and deliver a System Plan jointly.” and inserting in place thereof the following sentence: “Midstream Co may, in its sole discretion, work with OpCo or any of OpCo’s subsidiaries to prepare and deliver a System Plan jointly with such other entity or entities.”

3.2 Section 3.2 of the Agreement Terms and Conditions is hereby amended by inserting the following new clause (e)  immediately following clause (d)  of such Section 3.2 :

“(e) Substation and Interconnection Facilities . The obligations of Midstream Co hereunder to design and construct the Individual System and to perform the Services do not include the design or construction of any substation or other interconnecting facilities required to procure electricity for the Individual System. If a substation or any other interconnecting facility is required in order for Midstream Co to perform its obligations hereunder, Midstream Co and Producer shall enter into a separate agreement setting forth each Party’s responsibilities in connection therewith, including an allocation of responsibility for all associated costs and expenses.”

4. Amendments to Article 6 .

4.1 Clause (ii) of Section 6.1 of the Agreement Terms and Conditions is hereby amended and restated in its entirety to read as follows: “(ii) the Individual Second Phase Fee, if any, applicable to Second Phase Services performed within the Dedication Area,”

4.2 Section 6.1 of the Agreement Terms and Conditions is further amended by deleting the period at the end of such Section 6.1 and inserting in place thereof the following clause: “and (iv) the Individual Disposal by Truck Fee, if any.”

4.3 Section 6.3(d) of the Agreement Terms and Conditions is hereby amended and restated in its entirety to read as follows: “ Other System Fuel . Midstream Co may elect to use Other System Fuel as fuel to operate the Individual System, or to generate electricity for the operation of the Individual System and shall account for any Other System Fuel used by Midstream Co. Producer, at its sole cost and expense, shall procure all fuel, in addition to Other System Fuel used by Midstream Co, if any, required to operate the Individual System or to generate electricity for the operation of the Individual System and arrange for transportation of such fuel to the Individual System.”.

5. Amendments to Article 8 . Clause (d) of Section 8.2 of the Agreement Terms and Conditions is hereby amended by deleting the phrase “and Section 17.11 shall” and inserting in place thereof the clause: “, Section 17.11 and Section 18.7 shall”.

 

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6. New Article 18 . The following new Article 18 shall be inserted immediately following the conclusion of Article 17 of the Agreement Terms and Conditions:

Article 18

Pipeline Unavailability

Section 18.1 Effectiveness; Pipeline Unavailability . The Parties agree that this Article 18 shall be effective as of the Trucked Water Services Commencement Date.

(a) It is the intention of the Parties to use the Individual System for all Dedicated Production. To accommodate operational upsets and periods of increased flow (such as the occurrence of Pre-Connection Water during the Pre-Connection Period), the Parties have agreed under Section 2.3(b) that, during Pipeline Unavailability, Producer shall elect to either (i) exercise the Trucking Election or (ii) cease producing Dedicated Production until the end of the Pipeline Unavailability, as provided in Section 18.2 . To the extent Producer exercises its Trucking Election, this Article 18 shall govern with respect to the Trucked Volumes and the other matters set forth herein, rather than Articles 4 , 7 (other than Section 7.3 as it applies to Trucked Volumes delivered to a SWD Trucking Facility that fail to meet the quality requirements of Section 18.3(d) ) and 9 and Sections 5.1 , 5.2 , 5.3 , 5.4 , and 5.6 .

(b) The Parties agree that during Pipeline Unavailability, Producer shall not have the right to temporary services under Sections 3.3(a) and 3.3(b) of the Agreement or to a temporary release under Section 2.4(b)(ii) of the Agreement except to the extent that Midstream Co fails to provide Trucked Water Services.

(c) If Midstream Co fails to connect a Well or a Separator Facility to the Individual System by the On-Line Deadline, Producer may exercise its Trucking Election for the duration of the resulting Pipeline Unavailability, rather than exercising its right to a permanent release under Section 2.4(a)(i) and Section 2.4(a)(ii) . If Midstream Co fails to connect a Well or Separator Facility to the Individual System by the On-Line Deadline, but prior to such On-Line Deadline, the Parties have agreed that the connection of the Well or Separator Facility did not need to occur until after Pre-Connection Water has started flowing, then the resulting Pipeline Unavailability shall not entitle Producer to a permanent release under Section 2.4(a)(i) and Section 2.4(a)(ii) until such time as the agreed upon connection date has passed.

Section 18.2 Exercise of Trucking Election .

(a) If Producer expects a Well or Separator Facility to be completed prior to its connection to the Individual System, resulting in a Pipeline Unavailability, Producer shall give Midstream Co at least 72 hours’ advance notice that Dedicated Production is expected to be produced from the applicable Well or available at the applicable Separator Facility. After the applicable Well or

 

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Separator Facility is connected to the Individual System, following the Trucked Water Services Commencement Date, Midstream Co shall deliver notice to Producer of any Pipeline Unavailability pursuant to Section 5.5 .

(b) Once Producer or Midstream Co, as applicable, has delivered notice to the other Party that a Pipeline Unavailability is expected (or has occurred), Producer will inform Midstream Co whether Producer elects to exercise its Trucking Election or to cease producing Dedicated Production until the end of the Pipeline Unavailability. If Producer exercises the Trucking Election during the Pre-Connection Period, Producer shall coordinate with the water hauling trucks and arrange for transportation of the Dedicated Production to the SWD Trucking Facility at its sole cost and expense until the end of the Pre-Connection Period. At all other times during a Pipeline Unavailability, including when Pre-Connection Water is occurring after the expiration of the Pre-Connection Period, Midstream Co shall coordinate with the water hauling trucks and arrange for transportation of the Dedicated Production to the SWD Trucking Facility as part of the Trucked Water Services unless Producer has elected to cease producing Dedicated Production.

Section 18.3 Delivery of and Title to Trucked Volumes .

(a) Trucked Water Services Obligation . Upon the exercise of a Trucking Election, Midstream Co shall cause an Approved SWD Vendor to accept delivery of, take title to, store, handle and dispose of Dedicated Production that is delivered by truck to a SWD Trucking Facility. Upon the exercise of a Trucking Election, Midstream Co may, in its sole discretion, also accept delivery of, take title to, store, handle and dispose of other Product delivered by truck to a SWD Trucking Facility. The volumes that are actually delivered by truck shall be referred to as “Trucked Volumes”.

(b) Consistent Volumes . The Trucked Volumes delivered to the applicable SWD Trucking Facility shall be at a rate of delivery that is as uniform as reasonably possible in accordance with Producer’s drilling, completion, and frac schedule.

(c) Title and Custody . Title to and risk of loss to the Trucked Volumes and all contents thereof shall pass from Producer to Approved SWD Vendor when delivered into Approved SWD Vendor’s storage tanks at the SWD Trucking Facility, unless the Parties otherwise agree in writing.

(d) Quality . Producer represents and warrants that all Trucked Volumes delivered to an Approved SWD Vendor may lawfully be disposed of in Class II disposal wells. Midstream Co’s performance of Trucked Water Services for any Trucked Volumes that do not meet such requirement shall not relieve Producer from any liability for Producer’s breach of the foregoing representation and warranty nor serve as a waiver of any rights or remedies available to Midstream Co therefor.

 

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(e) Prohibition on Skimming . The Party that coordinates the water hauling trucks shall direct the Transporter not to skim, transfer, sell, or otherwise remove hydrocarbons or Trucked Volumes from trucks after receipt by such Transporter and prior to such Trucked Volumes being received by the Approved SWD Vendor. If the Approved SWD Vendor alleges that the Trucked Volumes delivered appear to have been handled in a manner inconsistent with the foregoing sentence, Producer shall corporate with Midstream Co and the Approved SWD Vendor in a review and analysis and, if required by the Approved SWD Vendor, take corrective action in a timely manner. If Transporters engaged by Producer fail to comply with the directions received, then Midstream Co may direct Producer to use a different Transporter.

Section 18.4 Unavailability of a SWD Trucking Facility . If for any reason there is a disruption of receipts at the SWD Trucking Facility, the Parties shall work in good faith to find a mutually agreeable resolution. If for any reason Midstream Co receives reimbursements in respect of trucking as a result of an originally scheduled SWD Trucking Facility being unable to accept deliveries, Midstream Co shall disclose such reimbursements on the applicable invoice and pass through such reimbursements to Producer if Producer paid the costs of the applicable Transporter directly.

Section 18.5 Testing; Non-Conforming Product . If requested by Midstream Co, Producer shall obtain water samples for analyses and retain appropriate qualified personnel to conduct analyses following methodologies considered appropriate in the industry or shall permit Midstream Co to obtain such samples.

Section 18.6 Producer’s Grant of Access . Producer hereby grants to Midstream Co, and shall grant to each Transporter, without warranty of title, either express or implied, to the extent that it may lawfully and is contractually permitted to do so without the incurrence of additional expense, the rights of ingress and egress with respect to, and the right to access, all lands constituting Dedicated Properties for the purposes of (a) transporting Trucked Volumes, and (b) obtaining water samples as described in Section 18.5 .

Section 18.7 Information . Producer agrees that information it supplies to Midstream Co regarding anticipated volumes of Dedicated Production and Trucked Volumes may be shared with an Approved SWD Vendor to the extent required by the applicable Approved SWD Vendor to assist in planning and operations, and Producer agrees to provide additional information regarding anticipated volumes of Dedicated Production and Trucked Volumes to the extent requested by Midstream Co in response to inquiries from an Approved SWD Vendor (so long as Midstream Co is required to deliver the requested information in order to comply with Midstream Co’s contractual arrangements with such Approved SWD Vendor). Under Section 3.1 , Midstream Co has the right to hold certain meetings with Producer, and at the request of Midstream Co, one of such meetings per year may be held in conjunction with the Approved SWD Vendor to discuss confer regarding planned activities.

Section 18.8 Indemnification in Respect of Trucked Volumes . Without in any way limiting any indemnification obligation otherwise set forth in the Agreement, the Parties agree that the indemnification obligations of Producer set forth in Section 7.3 and Section 15.2(b) apply to Trucked Volumes delivered to a SWD Trucking Facility.

 

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Section 18.9 Invoices from Approved SWD Vendor . The Party that engages the Transporter shall take all reasonable measures to ensure that the invoicing procedures that Midstream Co has negotiated with the Approved SWD Vendor are used, including notation of the geographic area to which the services pertain. Midstream Co shall provide a written copy of such procedures to Producer upon request.

7. Amendments to Agreement Addendum .

7.1 The specifications regarding the “Individual Second Phase Rate” appearing in the Agreement Addendum are hereby amended and restated in their entirety and the specifications regarding the “Individual Disposal By Truck Fee” are hereby added to the Agreement Addendum as follows:

 

   Individual Second Phase Fee  

An amount equal to the actual costs incurred by Midstream Co for providing the Second Phase Services multiplied by 1.05.

 

  
   Individual Disposal by Truck Fee  

An amount equal to the actual costs incurred by Midstream Co for providing the Trucked Water Services with respect to Dedicated Production delivered to a SWD Trucking Facility multiplied by 1.05.

 

  

8. Confidentiality . Pursuant to Section 17.11 of the Agreement (which appears in the Agreement Terms and Conditions), the Parties have agreed to treat the information exchanged in connection with and the provisions of the Agreement as confidential. In addition, confidential treatment has been requested with the Securities and Exchange Commission for the pricing terms of the Agreement and the Parties agree to take appropriate measures to abide by the requirements imposed by the Securities and Exchange Commission to preserve such confidential treatment, if granted.

9. Confirmation . The provisions of the Agreement, as amended by this Amendment, shall remain in full force and effect following the effectiveness of this Amendment. No provision of the Agreement is amended or otherwise modified hereby, except as expressly stated herein.

10. No Waiver . The execution, delivery and effectiveness of this Amendment shall not operate as a waiver of any right, power or remedy of any Party to the Agreement, nor constitute a waiver of any provision of the Agreement. On and after the Amendment Effective Time, this Amendment shall for all purposes constitute a part of the Agreement.

11. Counterparts . This Amendment may be executed in any number of counterparts, and each such counterpart hereof shall be deemed to be an original instrument, but all of such counterparts shall constitute for all purposes one agreement. Any signature hereto delivered by a Party by electronic mail shall be deemed an original signature hereto.

 

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12. Governing Law . This Amendment shall be governed by and construed in accordance with the laws of the State, excluding any conflicts of law rule or principle that might refer construction of such provisions to the laws of another jurisdiction.

(Signature Pages follow)

 

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IN WITNESS WHEREOF, the Parties hereto have executed this Amendment to the Agreement in duplicate originals to be effective as of the Amendment Effective Time.

 

“Producer”
NOBLE ENERGY, INC.
By:  

/s/ Gary W. Willingham

  Gary W. Willingham
  Executive Vice President

STATE OF TEXAS                    )

                                                     ) ss.

COUNTY OF HARRIS              )

The foregoing instrument was acknowledged before me this 29th day of August 2016, by Gary W. Willingham as Executive Vice President of Noble Energy, Inc., a Delaware corporation.

WITNESS my hand and official seal.

My commission expires: 05/05/2018

 

/s/ Joanne Garner

Notary Public

 

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“Midstream Co”

SAN JUAN RIVER DEVCO LP

  By: San Juan River DevCo GP LLC
       By: Noble Midstream Services, LLC
                     By:   /s/ Terry R. Gerhart                        
                             Terry R. Gerhart
                             Chief Executive Officer

STATE OF TEXAS                    )

                                                     ) ss.

COUNTY OF HARRIS              )

The foregoing instrument was acknowledged before me this 25th day of August 2016, by Terry R. Gerhart as Chief Executive Officer of Noble Midstream Services, LLC, which is the sole member of San Juan River DevCo GP LLC, which is the general partner of San Juan River DevCo LP, a Delaware limited partnership.

WITNESS my hand and official seal.

My commission expires: 05/05/2018

 

/s/ Joanne Garner
Notary Public

 

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Exhibit 10.14.2

When Recorded, Mail To:

Attn: DJ Land Manager

1625 Broadway, Suite 2200

Denver, CO 80202

AMENDMENT 01

TO

THAT CERTAIN

SECOND AMENDED AND RESTATED

PRODUCED WATER SERVICES AGREEMENT

M USTANG

C ONTRACT N UMBER : GRMU03-PW

This AMENDMENT 01 (this “ Amendment ”) shall be effective among Noble Energy, Inc., a Delaware corporation (the “ Producer ”) and Green River DevCo LP, a Delaware limited partnership, together with its permitted successors and assigns (“ Midstream Co ”) as of September 1, 2016 (the “ Amendment Effective Time ”). This Amendment modifies that certain Second Amended and Restated Produced Water Services Agreement, effective as of March 31, 2016 (the “ Agreement ”), which has been given contract number GRMU03-PW and is comprised of (i) that certain Second Amended and Restated Agreement Terms and Conditions Relating to Produced Water Services (the “ Agreement Terms and Conditions ”), last updated March 31, 2016, together with (ii) that certain Second Amended and Restated Agreement Addendum 03 (the “ Agreement Addendum ”), effective as of March 31, 2016. The Agreement Terms and Conditions, the Agreement Addendum and this Amendment shall constitute one contract and shall be the Agreement of the Parties.

WHEREAS, capitalized terms used herein have the meanings assigned to such terms in the Agreement Terms and Conditions.

WHEREAS, pursuant to Section 2.1 of the Agreement Terms and Conditions, Producer has dedicated and committed to deliver to Midstream Co under the Agreement, as and when produced, all of the Dedicated Production and agreed not to deliver any Dedicated Production to any other gatherer, purchaser, or other Person prior to delivery to Midstream Co at the Receipt Points.

WHEREAS, at certain times prior to or after connection of the Individual System to a particular Well or Separator Facility, the Individual System may not be available to accept deliveries of Dedicated Production.

WHEREAS, during such times, Producer remains obligated to deliver the Dedicated Production to Midstream Co and Midstream Co remains obligated to arrange for the disposal of such Dedicated Production, and the Parties desire to amend the Agreement to provide for the flexibility required.


WHEREAS, the Parties agree and acknowledge that amendments to the Agreement Terms and Conditions set forth herein constitute an amendment only to the Agreement and not to any other agreement in respect of produced water services to which Producer or Midstream Co is a party.

NOW, THEREFORE, in consideration of the foregoing recitals, which are incorporated herein and the mutual agreements in the Agreement, Midstream Co and Producer hereby agree as follows:

1. Amendments to Article 1 .

1.1 The following defined terms are hereby amended and restated in their entirety to read as follows:

Facility Segment ” means each segment of an Individual System comprised of facilities beginning at a Receipt Point and ending at an Internal Transfer Point. If an Individual System does not contain any such distinct segment, then the term Facility Segment shall be synonymous with Individual System.

Individual Fee ” means the aggregate of the Individual First Phase Fee, the Individual Second Phase Fee and the Individual Disposal by Truck Fee; provided that for purposes of the annual escalation in the Individual Fee described in Section 6.2(b) , such term shall not include any Reimbursed Amount.

Individual Second Phase Fee ” means the Monthly fee for providing Second Phase Services at a particular Individual System, as set forth opposite the heading “Individual Second Phase Fee” on the applicable Midstream Agreement Addendum; provided that the Individual Second Phase Fee shall accrue only with respect to Services performed by Midstream Co on Product flowing through an Individual System.

Individual System ” means the portion of the System beginning at the Receipt Points and ending at the Delivery Points. The Individual Systems in existence on the Effective Date are more particularly described in writing between Producer and Midstream Co. Additional Individual Systems may be added to the System from time to time in satisfaction of the needs identified by Producer and evidenced in writing between Producer and Midstream Co.

Other System Fuel ” means any natural gas delivered into Midstream Co’s custody by Producer pursuant to a Transaction Document between Producer and Midstream Co and measured and used as fuel by Midstream Co.

1.2 The defined terms “Drip Condensate”, “Gas”, “Gas System”, “Individual Second Phase Rate”, and “Other Services” are hereby deleted.

1.3 Clauses (a) and (b) of the defined term “Dedicated Production” are hereby amended and restated to read as follows: “(a) Product owned by Producer or an Affiliate of Producer and produced from a Well within the Dedication Area that is operated by Producer or an Affiliate under the Control of Producer, (b)  Reserved , and”.

 

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1.4 The defined term “Product” is hereby amended by inserting the following sentence at the end of such definition:

“In the event Producer exercises its Trucking Election, the term “Product” shall refer to all water that is accepted for delivery at a SWD Trucking Facility for the account of Midstream Co.”

1.5 The defined term “Services” is hereby amended by deleting “and (g)” at the end of clause (f) and inserting in place thereof the following: “, (g) Trucked Water Services and (h)”.

1.6 The following new definitions shall be added to Article 1 in alphabetical order:

Approved SWD Vendor ” means Midstream Co or a Third Party, in either case, as mutually agreed in writing by the Parties; provided, however, that if an Approved SWD Vendor rejects any Product delivered to a SWD Trucking Facility for quality or safety reasons, then Midstream Co shall be entitled to select an alternative vendor to take title to, store, handle, and dispose of such Product without obtaining Producer’s approval of such vendor, and such vendor shall be deemed an Approved SWD Vendor for such purpose.

Individual Disposal by Truck Fee ” means the Monthly fee for providing Trucked Water Services with respect to Dedicated Production delivered to a SWD Trucking Facility, as set forth opposite the heading “Individual Disposal by Truck Fee” on the applicable Midstream Agreement Addendum; provided that the Individual Disposal by Truck Fee shall accrue only with respect to Dedicated Production delivered by truck to a SWD Trucking Facility.

Pipeline Unavailability ” means any time after the Trucked Water Services Commencement Date during which the Individual System is not capable of accepting or transporting volumes of Product for any reason, including Pre-Connection Water that exceeds the capacity of the Individual System, Pre-Connection Water at a time when the Individual System is not yet online, curtailments on the Individual System and interruptions of Service.

Pre-Connection Water ” means the water-based solution that flows back to the surface during and after the completion of hydraulic fracturing a Well.

Pre-Connection Period ” means, with respect to a Well, the period of time commencing on the Day Pre-Connection Water begins to return to the surface and ending on the earlier of the date (a) on which such Well or the Separator Facility to which such Well is connected is connected to the Individual System or (b) that is 10 Days following the first Day of the applicable Pre-Connection Period.

 

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SWD Trucking Facility ” means an Approved SWD Vendor’s saltwater disposal well that Midstream Co has designated for disposal of Dedicated Production that is transported by truck.

Transporter ” means a wastewater truck transportation company engaged by Producer or Midstream Co, as applicable, to transport Trucked Volumes to the SWD Trucking Facility.

Trucked Volumes ” has the meaning given to it in Section 18.3(a) .

Trucked Water Services ” means, at any time when Producer has exercised its Trucking Election, Midstream Co shall make arrangements for the disposal of Dedicated Production that arrives by truck at the applicable SWD Trucking Facility. In addition, in connection with a Trucking Election, (a) during a Pre-Connection Period, if Producer requests and Midstream Co agrees, then with Producer’s reasonable cooperation, Midstream Co will arrange for the dispatching of the applicable trucks to the applicable SWD Trucking Facility and otherwise coordinate the water hauling trucks and (b) at all other times during a Pipeline Unavailability in which Producer has made a Trucking Election, Midstream Co shall arrange for the dispatching of the applicable trucks to the applicable SWD Trucking Facility and otherwise coordinate the water hauling trucks.

Trucked Water Services Commencement Date ” has the meaning given to it in Section 2.3(b) .

Trucking Election ” has the meaning given to it in Section 2.3(b) .

2. Amendments to Article 2 .

2.1 Section 2.3(b) of the Agreement Terms and Conditions is hereby amended and restated in its entirety to read: “(b) following the date set forth in writing between Producer and Midstream Co (such date as it may be updated by Midstream Co and Producer, the “Trucked Water Services Commencement Date”), Producer may elect to deliver or have delivered Dedicated Production directly to a SWD Trucking Facility during any Pipeline Unavailability as provided in Section 18.2 (the “ Trucking Election ”); and”.

2.2 Section 2.3(d) of the Agreement Terms and Conditions is hereby amended and restated in its entirety to read: “(d) to pool, communitize or unitize Producer’s interests with respect to Dedicated Production”.

2.3 Section 2.4(b)(iv) of the Agreement Terms and Conditions is amended and restated in its entirety to read: “(iv) Reserved. ”.

3. Amendments to Article 3 .

3.1 Section 3.1(e) of the Agreement Terms and Conditions is hereby amended by deleting the sentence that reads as follows “In the sole discretion of each Person serving as a Midstream Co under a Midstream Agreement Addendum, such Midstream Co may work with

 

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any other Midstream Co to prepare and deliver a System Plan jointly.” and inserting in place thereof the following sentence: “Midstream Co may, in its sole discretion, work with OpCo or any of OpCo’s subsidiaries to prepare and deliver a System Plan jointly with such other entity or entities.”

3.2 Section 3.2 of the Agreement Terms and Conditions is hereby amended by inserting the following new clause (e)  immediately following clause (d)  of such Section 3.2 :

“(e) Substation and Interconnection Facilities . The obligations of Midstream Co hereunder to design and construct the Individual System and to perform the Services do not include the design or construction of any substation or other interconnecting facilities required to procure electricity for the Individual System. If a substation or any other interconnecting facility is required in order for Midstream Co to perform its obligations hereunder, Midstream Co and Producer shall enter into a separate agreement setting forth each Party’s responsibilities in connection therewith, including an allocation of responsibility for all associated costs and expenses.”

4. Amendments to Article 6 .

4.1 Clause (ii) of Section 6.1 of the Agreement Terms and Conditions is hereby amended and restated in its entirety to read as follows: “(ii) the Individual Second Phase Fee, if any, applicable to Second Phase Services performed within the Dedication Area,”

4.2 Section 6.1 of the Agreement Terms and Conditions is further amended by deleting the period at the end of such Section 6.1 and inserting in place thereof the following clause: “and (iv) the Individual Disposal by Truck Fee, if any.”

4.3 Section 6.3(d) of the Agreement Terms and Conditions is hereby amended and restated in its entirety to read as follows: “ Other System Fuel . Midstream Co may elect to use Other System Fuel as fuel to operate the Individual System, or to generate electricity for the operation of the Individual System and shall account for any Other System Fuel used by Midstream Co. Producer, at its sole cost and expense, shall procure all fuel, in addition to Other System Fuel used by Midstream Co, if any, required to operate the Individual System or to generate electricity for the operation of the Individual System and arrange for transportation of such fuel to the Individual System.”.

5. Amendments to Article 8 . Clause (d) of Section 8.2 of the Agreement Terms and Conditions is hereby amended by deleting the phrase “and Section 17.11 shall” and inserting in place thereof the clause: “, Section 17.11 and Section 18.7 shall”.

 

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6. New Article 18 . The following new Article 18 shall be inserted immediately following the conclusion of Article 17 of the Agreement Terms and Conditions:

Article 18

Pipeline Unavailability

Section 18.1 Effectiveness; Pipeline Unavailability . The Parties agree that this Article 18 shall be effective as of the Trucked Water Services Commencement Date.

(a) It is the intention of the Parties to use the Individual System for all Dedicated Production. To accommodate operational upsets and periods of increased flow (such as the occurrence of Pre-Connection Water during the Pre-Connection Period), the Parties have agreed under Section 2.3(b) that, during Pipeline Unavailability, Producer shall elect to either (i) exercise the Trucking Election or (ii) cease producing Dedicated Production until the end of the Pipeline Unavailability, as provided in Section 18.2 . To the extent Producer exercises its Trucking Election, this Article 18 shall govern with respect to the Trucked Volumes and the other matters set forth herein, rather than Articles 4 , 7 (other than Section 7.3 as it applies to Trucked Volumes delivered to a SWD Trucking Facility that fail to meet the quality requirements of Section 18.3(d) ) and 9 and Sections 5.1 , 5.2 , 5.3 , 5.4 , and 5.6 .

(b) The Parties agree that during Pipeline Unavailability, Producer shall not have the right to temporary services under Sections 3.3(a) and 3.3(b) of the Agreement or to a temporary release under Section 2.4(b)(ii) of the Agreement except to the extent that Midstream Co fails to provide Trucked Water Services.

(c) If Midstream Co fails to connect a Well or a Separator Facility to the Individual System by the On-Line Deadline, Producer may exercise its Trucking Election for the duration of the resulting Pipeline Unavailability, rather than exercising its right to a permanent release under Section 2.4(a)(i) and Section 2.4(a)(ii) . If Midstream Co fails to connect a Well or Separator Facility to the Individual System by the On-Line Deadline, but prior to such On-Line Deadline, the Parties have agreed that the connection of the Well or Separator Facility did not need to occur until after Pre-Connection Water has started flowing, then the resulting Pipeline Unavailability shall not entitle Producer to a permanent release under Section 2.4(a)(i) and Section 2.4(a)(ii) until such time as the agreed upon connection date has passed.

Section 18.2 Exercise of Trucking Election .

(a) If Producer expects a Well or Separator Facility to be completed prior to its connection to the Individual System, resulting in a Pipeline Unavailability, Producer shall give Midstream Co at least 72 hours’ advance notice that Dedicated Production is expected to be produced from the applicable Well or available at the applicable Separator Facility. After the applicable Well or

 

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Separator Facility is connected to the Individual System, following the Trucked Water Services Commencement Date, Midstream Co shall deliver notice to Producer of any Pipeline Unavailability pursuant to Section 5.5 .

(b) Once Producer or Midstream Co, as applicable, has delivered notice to the other Party that a Pipeline Unavailability is expected (or has occurred), Producer will inform Midstream Co whether Producer elects to exercise its Trucking Election or to cease producing Dedicated Production until the end of the Pipeline Unavailability. If Producer exercises the Trucking Election during the Pre-Connection Period, Producer shall coordinate with the water hauling trucks and arrange for transportation of the Dedicated Production to the SWD Trucking Facility at its sole cost and expense until the end of the Pre-Connection Period. At all other times during a Pipeline Unavailability, including when Pre-Connection Water is occurring after the expiration of the Pre-Connection Period, Midstream Co shall coordinate with the water hauling trucks and arrange for transportation of the Dedicated Production to the SWD Trucking Facility as part of the Trucked Water Services unless Producer has elected to cease producing Dedicated Production.

Section 18.3 Delivery of and Title to Trucked Volumes .

(a) Trucked Water Services Obligation . Upon the exercise of a Trucking Election, Midstream Co shall cause an Approved SWD Vendor to accept delivery of, take title to, store, handle and dispose of Dedicated Production that is delivered by truck to a SWD Trucking Facility. Upon the exercise of a Trucking Election, Midstream Co may, in its sole discretion, also accept delivery of, take title to, store, handle and dispose of other Product delivered by truck to a SWD Trucking Facility. The volumes that are actually delivered by truck shall be referred to as “Trucked Volumes”.

(b) Consistent Volumes . The Trucked Volumes delivered to the applicable SWD Trucking Facility shall be at a rate of delivery that is as uniform as reasonably possible in accordance with Producer’s drilling, completion, and frac schedule.

(c) Title and Custody . Title to and risk of loss to the Trucked Volumes and all contents thereof shall pass from Producer to Approved SWD Vendor when delivered into Approved SWD Vendor’s storage tanks at the SWD Trucking Facility, unless the Parties otherwise agree in writing.

(d) Quality . Producer represents and warrants that all Trucked Volumes delivered to an Approved SWD Vendor may lawfully be disposed of in Class II disposal wells. Midstream Co’s performance of Trucked Water Services for any Trucked Volumes that do not meet such requirement shall not relieve Producer from any liability for Producer’s breach of the foregoing representation and warranty nor serve as a waiver of any rights or remedies available to Midstream Co therefor.

 

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(e) Prohibition on Skimming . The Party that coordinates the water hauling trucks shall direct the Transporter not to skim, transfer, sell, or otherwise remove hydrocarbons or Trucked Volumes from trucks after receipt by such Transporter and prior to such Trucked Volumes being received by the Approved SWD Vendor. If the Approved SWD Vendor alleges that the Trucked Volumes delivered appear to have been handled in a manner inconsistent with the foregoing sentence, Producer shall corporate with Midstream Co and the Approved SWD Vendor in a review and analysis and, if required by the Approved SWD Vendor, take corrective action in a timely manner. If Transporters engaged by Producer fail to comply with the directions received, then Midstream Co may direct Producer to use a different Transporter.

Section 18.4 Unavailability of a SWD Trucking Facility . If for any reason there is a disruption of receipts at the SWD Trucking Facility, the Parties shall work in good faith to find a mutually agreeable resolution. If for any reason Midstream Co receives reimbursements in respect of trucking as a result of an originally scheduled SWD Trucking Facility being unable to accept deliveries, Midstream Co shall disclose such reimbursements on the applicable invoice and pass through such reimbursements to Producer if Producer paid the costs of the applicable Transporter directly.

Section 18.5 Testing; Non-Conforming Product . If requested by Midstream Co, Producer shall obtain water samples for analyses and retain appropriate qualified personnel to conduct analyses following methodologies considered appropriate in the industry or shall permit Midstream Co to obtain such samples.

Section 18.6 Producer’s Grant of Access . Producer hereby grants to Midstream Co, and shall grant to each Transporter, without warranty of title, either express or implied, to the extent that it may lawfully and is contractually permitted to do so without the incurrence of additional expense, the rights of ingress and egress with respect to, and the right to access, all lands constituting Dedicated Properties for the purposes of (a) transporting Trucked Volumes, and (b) obtaining water samples as described in Section 18.5 .

Section 18.7 Information . Producer agrees that information it supplies to Midstream Co regarding anticipated volumes of Dedicated Production and Trucked Volumes may be shared with an Approved SWD Vendor to the extent required by the applicable Approved SWD Vendor to assist in planning and operations, and Producer agrees to provide additional information regarding anticipated volumes of Dedicated Production and Trucked Volumes to the extent requested by Midstream Co in response to inquiries from an Approved SWD Vendor (so long as Midstream Co is required to deliver the requested information in order to comply with Midstream Co’s contractual arrangements with such Approved SWD Vendor). Under Section 3.1 , Midstream Co has the right to hold certain meetings with Producer, and at the request of Midstream Co, one of such meetings per year may be held in conjunction with the Approved SWD Vendor to discuss confer regarding planned activities.

Section 18.8 Indemnification in Respect of Trucked Volumes . Without in any way limiting any indemnification obligation otherwise set forth in the Agreement, the Parties agree that the indemnification obligations of Producer set forth in Section 7.3 and Section 15.2(b) apply to Trucked Volumes delivered to a SWD Trucking Facility.

 

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Section 18.9 Invoices from Approved SWD Vendor . The Party that engages the Transporter shall take all reasonable measures to ensure that the invoicing procedures that Midstream Co has negotiated with the Approved SWD Vendor are used, including notation of the geographic area to which the services pertain. Midstream Co shall provide a written copy of such procedures to Producer upon request.

7. Amendments to Agreement Addendum .

7.1 The specifications regarding the “Individual Second Phase Rate” appearing in the Agreement Addendum are hereby amended and restated in their entirety and the specifications regarding the “Individual Disposal By Truck Fee” are hereby added to the Agreement Addendum as follows:

 

   Individual Second Phase Fee  

An amount equal to the actual costs incurred by Midstream Co for providing the Second Phase Services multiplied by 1.05.

 

   Individual Disposal by Truck Fee  

An amount equal to the actual costs incurred by Midstream Co for providing the Trucked Water Services with respect to Dedicated Production delivered to a SWD Trucking Facility multiplied by 1.05.

 

8. Confidentiality . Pursuant to Section 17.11 of the Agreement (which appears in the Agreement Terms and Conditions), the Parties have agreed to treat the information exchanged in connection with and the provisions of the Agreement as confidential. In addition, confidential treatment has been requested with the Securities and Exchange Commission for the pricing terms of the Agreement and the Parties agree to take appropriate measures to abide by the requirements imposed by the Securities and Exchange Commission to preserve such confidential treatment, if granted.

9. Confirmation . The provisions of the Agreement, as amended by this Amendment, shall remain in full force and effect following the effectiveness of this Amendment. No provision of the Agreement is amended or otherwise modified hereby, except as expressly stated herein.

10. No Waiver . The execution, delivery and effectiveness of this Amendment shall not operate as a waiver of any right, power or remedy of any Party to the Agreement, nor constitute a waiver of any provision of the Agreement. On and after the Amendment Effective Time, this Amendment shall for all purposes constitute a part of the Agreement.

11. Counterparts . This Amendment may be executed in any number of counterparts, and each such counterpart hereof shall be deemed to be an original instrument, but all of such counterparts shall constitute for all purposes one agreement. Any signature hereto delivered by a Party by electronic mail shall be deemed an original signature hereto.

 

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12. Governing Law . This Amendment shall be governed by and construed in accordance with the laws of the State, excluding any conflicts of law rule or principle that might refer construction of such provisions to the laws of another jurisdiction.

(Signature Pages follow)

 

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IN WITNESS WHEREOF, the Parties hereto have executed this Amendment to the Agreement in duplicate originals to be effective as of the Amendment Effective Time.

 

“Producer”
NOBLE ENERGY, INC.
By:  

/s/ Gary W. Willingham

  Gary W. Willingham
  Executive Vice President

 

STATE OF TEXAS           )
          ) ss.
COUNTY OF HARRIS           )

The foregoing instrument was acknowledged before me this 29th day of August 2016, by Gary W. Willingham as Executive Vice President of Noble Energy, Inc., a Delaware corporation.

WITNESS my hand and official seal.

My commission expires: 05/05/2018

 

/s/ Joanne Garner

Notary Public

 

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“Midstream Co”

GREEN RIVER DEVCO LP

  By: Green River DevCo GP LLC
       By: Noble Midstream Services, LLC
                     By:   /s/ Terry R. Gerhart                        
                             Terry R. Gerhart
                             Chief Executive Officer

STATE OF TEXAS                    )

                                                     ) ss.

COUNTY OF HARRIS              )

The foregoing instrument was acknowledged before me this 29th day of August 2016, by Terry R. Gerhart as Chief Executive Officer of Noble Midstream Services, LLC, which is the sole member of Green River DevCo GP LLC, which is the general partner of Green River DevCo LP, a Delaware limited partnership.

WITNESS my hand and official seal.

My commission expires: 05/05/2018

 

/s/ Joanne Garner

Notary Public

 

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Exhibit 10.15.2

Execution Version

When Recorded, Mail To:

Attn: DJ Land Manager

1625 Broadway, Suite 2200

Denver, CO 80202

AMENDMENT 01

TO

THAT CERTAIN

SECOND AMENDED AND RESTATED

PRODUCED WATER SERVICES AGREEMENT

B RONCO

C ONTRACT N UMBER : GUBR04-PW

This AMENDMENT 01 (this “ Amendment ”) shall be effective among Noble Energy, Inc., a Delaware corporation (the “ Producer ”) and Gunnison River DevCo LP, a Delaware limited partnership, together with its permitted successors and assigns (“ Midstream Co ”) as of September 1, 2016 (the “ Amendment Effective Time ”). This Amendment modifies that certain Second Amended and Restated Produced Water Services Agreement, effective as of March 31, 2016 (the “ Agreement ”), which has been given contract number GUBR04-PW and is comprised of (i) that certain Second Amended and Restated Agreement Terms and Conditions Relating to Produced Water Services (the “ Agreement Terms and Conditions ”), last updated March 31, 2016, together with (ii) that certain Second Amended and Restated Agreement Addendum 04 (the “ Agreement Addendum ”), effective as of March 31, 2016. The Agreement Terms and Conditions, the Agreement Addendum and this Amendment shall constitute one contract and shall be the Agreement of the Parties.

WHEREAS, capitalized terms used herein have the meanings assigned to such terms in the Agreement Terms and Conditions.

WHEREAS, Section 16.1 of the Agreement (which appears in the Agreement Terms and Conditions) prohibits either Party to the Agreement from assigning its rights and obligations, except that Producer may assign its rights and obligations to any Person (herein, the “ Transferee ”) to whom Producer transfers Dedicated Properties so long as such Transferee assumes the rights and obligations of Producer with respect to such transferred Dedicated Properties.

WHEREAS, pursuant to that certain Purchase and Sale Agreement, by and among Producer, NBL Energy Royalties, Inc. and Noble Energy WyCo, LLC, collectively as the Seller, and Synergy Resources Corporation, as Purchaser (the “ Transferee ”), executed May 2, 2016 with an effective time of April 1, 2016 at 12:01 AM, Producer agreed to sell approximately 30,000 acres of the Dedicated Properties to the Transferee.

WHEREAS, pursuant to Section 2.1 of the Agreement Terms and Conditions, Producer has dedicated and committed to deliver to Midstream Co under the Agreement, as and when produced, all of the Dedicated Production and agreed not to deliver any Dedicated Production to any other gatherer, purchaser, or other Person prior to delivery to Midstream Co at the Receipt Points.


WHEREAS, at certain times prior to or after connection of the Individual System to a particular Well or Separator Facility, the Individual System may not be available to accept deliveries of Dedicated Production.

WHEREAS, during such times, Producer remains obligated to deliver the Dedicated Production to Midstream Co and Midstream Co remains obligated to arrange for the disposal of such Dedicated Production, and the Parties desire to amend the Agreement to provide for the flexibility required.

WHEREAS, the Parties agree and acknowledge that amendments to the Agreement Terms and Conditions set forth herein constitute an amendment only to the Agreement and not to any other agreement in respect of produced water services to which Producer or Midstream Co is a party.

NOW, THEREFORE, in consideration of the foregoing recitals, which are incorporated herein and the mutual agreements in the Agreement, Midstream Co and Producer hereby agree as follows:

1. Amendments to Article 1 .

1.1 The following defined terms are hereby amended and restated in their entirety to read as follows:

Facility Segment ” means each segment of an Individual System comprised of facilities beginning at a Receipt Point and ending at an Internal Transfer Point. If an Individual System does not contain any such distinct segment, then the term Facility Segment shall be synonymous with Individual System.

Individual Fee ” means the aggregate of the Individual First Phase Fee, the Individual Second Phase Fee and the Individual Disposal by Truck Fee; provided that for purposes of the annual escalation in the Individual Fee described in Section 6.2(b) , such term shall not include any Reimbursed Amount.

Individual Second Phase Fee ” means the Monthly fee for providing Second Phase Services at a particular Individual System, as set forth opposite the heading “Individual Second Phase Fee” on the applicable Midstream Agreement Addendum; provided that the Individual Second Phase Fee shall accrue only with respect to Services performed by Midstream Co on Product flowing through an Individual System.

Individual System ” means the portion of the System beginning at the Receipt Points and ending at the Delivery Points. The Individual Systems in existence on the Effective Date are more particularly described in writing between Producer and Midstream Co. Additional Individual Systems may be added to the System from time to time in satisfaction of the needs identified by Producer and evidenced in writing between Producer and Midstream Co.

 

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Other System Fuel ” means any natural gas delivered into Midstream Co’s custody by Producer pursuant to a Transaction Document between Producer and Midstream Co and measured and used as fuel by Midstream Co.

1.2 The defined terms “Drip Condensate”, “Gas”, “Gas System”, “Individual Second Phase Rate”, and “Other Services” are hereby deleted.

1.3 Clauses (a) and (b) of the defined term “Dedicated Production” are hereby amended and restated to read as follows: “(a) Product owned by Producer or an Affiliate of Producer and produced from a Well within the Dedication Area that is operated by Producer or an Affiliate under the Control of Producer, (b)  Reserved , and”.

1.4 The defined term “Product” is hereby amended by inserting the following sentence at the end of such definition:

“In the event Producer exercises its Trucking Election, the term “Product” shall refer to all water that is accepted for delivery at a SWD Trucking Facility for the account of Midstream Co.”

1.5 The defined term “Services” is hereby amended by deleting “and (g)” at the end of clause (f) and inserting in place thereof the following: “, (g) Trucked Water Services and (h)”.

1.6 The following new definitions shall be added to Article 1 in alphabetical order:

Approved SWD Vendor ” means Midstream Co or a Third Party, in either case, as mutually agreed in writing by the Parties; provided, however, that if an Approved SWD Vendor rejects any Product delivered to a SWD Trucking Facility for quality or safety reasons, then Midstream Co shall be entitled to select an alternative vendor to take title to, store, handle, and dispose of such Product without obtaining Producer’s approval of such vendor, and such vendor shall be deemed an Approved SWD Vendor for such purpose.

Individual Disposal by Truck Fee ” means the Monthly fee for providing Trucked Water Services with respect to Dedicated Production delivered to a SWD Trucking Facility, as set forth opposite the heading “Individual Disposal by Truck Fee” on the applicable Midstream Agreement Addendum; provided that the Individual Disposal by Truck Fee shall accrue only with respect to Dedicated Production delivered by truck to a SWD Trucking Facility.

Pipeline Unavailability ” means any time after the Trucked Water Services Commencement Date during which the Individual System is not capable of accepting or transporting volumes of Product for any reason, including Pre-Connection Water that exceeds the capacity of the Individual System, Pre-Connection Water at a time when the Individual System is not yet online, curtailments on the Individual System and interruptions of Service.

 

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Pre-Connection Water ” means the water-based solution that flows back to the surface during and after the completion of hydraulic fracturing a Well.

Pre-Connection Period ” means, with respect to a Well, the period of time commencing on the Day Pre-Connection Water begins to return to the surface and ending on the earlier of the date (a) on which such Well or the Separator Facility to which such Well is connected is connected to the Individual System or (b) that is 10 Days following the first Day of the applicable Pre-Connection Period.

SWD Trucking Facility ” means an Approved SWD Vendor’s saltwater disposal well that Midstream Co has designated for disposal of Dedicated Production that is transported by truck.

Transporter ” means a wastewater truck transportation company engaged by Producer or Midstream Co, as applicable, to transport Trucked Volumes to the SWD Trucking Facility.

Trucked Volumes ” has the meaning given to it in Section 18.3(a) .

Trucked Water Services ” means, at any time when Producer has exercised its Trucking Election, Midstream Co shall make arrangements for the disposal of Dedicated Production that arrives by truck at the applicable SWD Trucking Facility. In addition, in connection with a Trucking Election, (a) during a Pre-Connection Period, if Producer requests and Midstream Co agrees, then with Producer’s reasonable cooperation, Midstream Co will arrange for the dispatching of the applicable trucks to the applicable SWD Trucking Facility and otherwise coordinate the water hauling trucks and (b) at all other times during a Pipeline Unavailability in which Producer has made a Trucking Election, Midstream Co shall arrange for the dispatching of the applicable trucks to the applicable SWD Trucking Facility and otherwise coordinate the water hauling trucks.

Trucked Water Services Commencement Date ” has the meaning given to it in Section 2.3(b) .

Trucking Election ” has the meaning given to it in Section 2.3(b) .

2. Amendments to Article 2 .

2.1 Section 2.3(b) of the Agreement Terms and Conditions is hereby amended and restated in its entirety to read: “(b) following the date set forth in writing between Producer and Midstream Co (such date as it may be updated by Midstream Co and Producer, the “Trucked Water Services Commencement Date”), Producer may elect to deliver or have delivered Dedicated Production directly to a SWD Trucking Facility during any Pipeline Unavailability as provided in Section 18.2 (the “ Trucking Election ”); and”.

 

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2.2 Section 2.3(d) of the Agreement Terms and Conditions is hereby amended and restated in its entirety to read: “(d) to pool, communitize or unitize Producer’s interests with respect to Dedicated Production”.

2.3 Section 2.4(b)(iv) of the Agreement Terms and Conditions is amended and restated in its entirety to read: “(iv) Reserved. ”.

3. Amendments to Article 3 .

3.1 Section 3.1(e) of the Agreement Terms and Conditions is hereby amended by deleting the sentence that reads as follows “In the sole discretion of each Person serving as a Midstream Co under a Midstream Agreement Addendum, such Midstream Co may work with any other Midstream Co to prepare and deliver a System Plan jointly.” and inserting in place thereof the following sentence: “Midstream Co may, in its sole discretion, work with OpCo or any of OpCo’s subsidiaries to prepare and deliver a System Plan jointly with such other entity or entities.”

3.2 Section 3.2 of the Agreement Terms and Conditions is hereby amended by inserting the following new clause (e)  immediately following clause (d)  of such Section 3.2 :

“(e) Substation and Interconnection Facilities . The obligations of Midstream Co hereunder to design and construct the Individual System and to perform the Services do not include the design or construction of any substation or other interconnecting facilities required to procure electricity for the Individual System. If a substation or any other interconnecting facility is required in order for Midstream Co to perform its obligations hereunder, Midstream Co and Producer shall enter into a separate agreement setting forth each Party’s responsibilities in connection therewith, including an allocation of responsibility for all associated costs and expenses.”

4. Amendments to Article 6 .

4.1 Clause (ii) of Section 6.1 of the Agreement Terms and Conditions is hereby amended and restated in its entirety to read as follows: “(ii) the Individual Second Phase Fee, if any, applicable to Second Phase Services performed within the Dedication Area,”

4.2 Section 6.1 of the Agreement Terms and Conditions is further amended by deleting the period at the end of such Section 6.1 and inserting in place thereof the following clause: “and (iv) the Individual Disposal by Truck Fee, if any.”

4.3 Section 6.3(d) of the Agreement Terms and Conditions is hereby amended and restated in its entirety to read as follows: “ Other System Fuel . Midstream Co may elect to use Other System Fuel as fuel to operate the Individual System, or to generate electricity for the operation of the Individual System and shall account for any Other System Fuel used by Midstream Co. Producer, at its sole cost and expense, shall procure all fuel, in addition to Other System Fuel used by Midstream Co, if any, required to operate the Individual System or to generate electricity for the operation of the Individual System and arrange for transportation of such fuel to the Individual System.”.

 

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5. Amendments to Article 8 . Clause (d) of Section 8.2 of the Agreement Terms and Conditions is hereby amended by deleting the phrase “and Section 17.11 shall” and inserting in place thereof the clause: “, Section 17.11 and Section 18.7 shall”.

6. New Article 18 . The following new Article 18 shall be inserted immediately following the conclusion of Article 17 of the Agreement Terms and Conditions:

Article 18

Pipeline Unavailability

Section 18.1 Effectiveness; Pipeline Unavailability . The Parties agree that this Article 18 shall be effective as of the Trucked Water Services Commencement Date.

(a) It is the intention of the Parties to use the Individual System for all Dedicated Production. To accommodate operational upsets and periods of increased flow (such as the occurrence of Pre-Connection Water during the Pre-Connection Period), the Parties have agreed under Section 2.3(b) that, during Pipeline Unavailability, Producer shall elect to either (i) exercise the Trucking Election or (ii) cease producing Dedicated Production until the end of the Pipeline Unavailability, as provided in Section 18.2 . To the extent Producer exercises its Trucking Election, this Article 18 shall govern with respect to the Trucked Volumes and the other matters set forth herein, rather than Articles 4 , 7 (other than Section 7.3 as it applies to Trucked Volumes delivered to a SWD Trucking Facility that fail to meet the quality requirements of Section 18.3(d) ) and 9 and Sections 5.1 , 5.2 , 5.3 , 5.4 , and 5.6 .

(b) The Parties agree that during Pipeline Unavailability, Producer shall not have the right to temporary services under Sections 3.3(a) and 3.3(b) of the Agreement or to a temporary release under Section 2.4(b)(ii) of the Agreement except to the extent that Midstream Co fails to provide Trucked Water Services.

(c) If Midstream Co fails to connect a Well or a Separator Facility to the Individual System by the On-Line Deadline, Producer may exercise its Trucking Election for the duration of the resulting Pipeline Unavailability, rather than exercising its right to a permanent release under Section 2.4(a)(i) and Section 2.4(a)(ii) . If Midstream Co fails to connect a Well or Separator Facility to the Individual System by the On-Line Deadline, but prior to such On-Line Deadline, the Parties have agreed that the connection of the Well or Separator Facility did not need to occur until after Pre-Connection Water has started flowing, then the resulting Pipeline Unavailability shall not entitle Producer to a permanent release under Section 2.4(a)(i) and Section 2.4(a)(ii) until such time as the agreed upon connection date has passed.

Section 18.2 Exercise of Trucking Election .

(a) If Producer expects a Well or Separator Facility to be completed prior to its connection to the Individual System, resulting in a Pipeline

 

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Unavailability, Producer shall give Midstream Co at least 72 hours’ advance notice that Dedicated Production is expected to be produced from the applicable Well or available at the applicable Separator Facility. After the applicable Well or Separator Facility is connected to the Individual System, following the Trucked Water Services Commencement Date, Midstream Co shall deliver notice to Producer of any Pipeline Unavailability pursuant to Section 5.5 .

(b) Once Producer or Midstream Co, as applicable, has delivered notice to the other Party that a Pipeline Unavailability is expected (or has occurred), Producer will inform Midstream Co whether Producer elects to exercise its Trucking Election or to cease producing Dedicated Production until the end of the Pipeline Unavailability. If Producer exercises the Trucking Election during the Pre-Connection Period, Producer shall coordinate with the water hauling trucks and arrange for transportation of the Dedicated Production to the SWD Trucking Facility at its sole cost and expense until the end of the Pre-Connection Period. At all other times during a Pipeline Unavailability, including when Pre-Connection Water is occurring after the expiration of the Pre-Connection Period, Midstream Co shall coordinate with the water hauling trucks and arrange for transportation of the Dedicated Production to the SWD Trucking Facility as part of the Trucked Water Services unless Producer has elected to cease producing Dedicated Production.

Section 18.3 Delivery of and Title to Trucked Volumes .

(a) Trucked Water Services Obligation . Upon the exercise of a Trucking Election, Midstream Co shall cause an Approved SWD Vendor to accept delivery of, take title to, store, handle and dispose of Dedicated Production that is delivered by truck to a SWD Trucking Facility. Upon the exercise of a Trucking Election, Midstream Co may, in its sole discretion, also accept delivery of, take title to, store, handle and dispose of other Product delivered by truck to a SWD Trucking Facility. The volumes that are actually delivered by truck shall be referred to as “Trucked Volumes”.

(b) Consistent Volumes . The Trucked Volumes delivered to the applicable SWD Trucking Facility shall be at a rate of delivery that is as uniform as reasonably possible in accordance with Producer’s drilling, completion, and frac schedule.

(c) Title and Custody . Title to and risk of loss to the Trucked Volumes and all contents thereof shall pass from Producer to Approved SWD Vendor when delivered into Approved SWD Vendor’s storage tanks at the SWD Trucking Facility, unless the Parties otherwise agree in writing.

(d) Quality . Producer represents and warrants that all Trucked Volumes delivered to an Approved SWD Vendor may lawfully be disposed of in Class II disposal wells. Midstream Co’s performance of Trucked Water Services for any Trucked Volumes that do not meet such requirement shall not relieve Producer from any liability for Producer’s breach of the foregoing representation and warranty nor serve as a waiver of any rights or remedies available to Midstream Co therefor.

 

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(e) Prohibition on Skimming . The Party that coordinates the water hauling trucks shall direct the Transporter not to skim, transfer, sell, or otherwise remove hydrocarbons or Trucked Volumes from trucks after receipt by such Transporter and prior to such Trucked Volumes being received by the Approved SWD Vendor. If the Approved SWD Vendor alleges that the Trucked Volumes delivered appear to have been handled in a manner inconsistent with the foregoing sentence, Producer shall corporate with Midstream Co and the Approved SWD Vendor in a review and analysis and, if required by the Approved SWD Vendor, take corrective action in a timely manner. If Transporters engaged by Producer fail to comply with the directions received, then Midstream Co may direct Producer to use a different Transporter.

Section 18.4 Unavailability of a SWD Trucking Facility . If for any reason there is a disruption of receipts at the SWD Trucking Facility, the Parties shall work in good faith to find a mutually agreeable resolution. If for any reason Midstream Co receives reimbursements in respect of trucking as a result of an originally scheduled SWD Trucking Facility being unable to accept deliveries, Midstream Co shall disclose such reimbursements on the applicable invoice and pass through such reimbursements to Producer if Producer paid the costs of the applicable Transporter directly.

Section 18.5 Testing; Non-Conforming Product . If requested by Midstream Co, Producer shall obtain water samples for analyses and retain appropriate qualified personnel to conduct analyses following methodologies considered appropriate in the industry or shall permit Midstream Co to obtain such samples.

Section 18.6 Producer’s Grant of Access . Producer hereby grants to Midstream Co, and shall grant to each Transporter, without warranty of title, either express or implied, to the extent that it may lawfully and is contractually permitted to do so without the incurrence of additional expense, the rights of ingress and egress with respect to, and the right to access, all lands constituting Dedicated Properties for the purposes of (a) transporting Trucked Volumes, and (b) obtaining water samples as described in Section 18.5 .

Section 18.7 Information . Producer agrees that information it supplies to Midstream Co regarding anticipated volumes of Dedicated Production and Trucked Volumes may be shared with an Approved SWD Vendor to the extent required by the applicable Approved SWD Vendor to assist in planning and operations, and Producer agrees to provide additional information regarding anticipated volumes of Dedicated Production and Trucked Volumes to the extent requested by Midstream Co in response to inquiries from an Approved SWD Vendor (so long as Midstream Co is required to deliver the requested information in order to comply with Midstream Co’s contractual arrangements with such Approved SWD Vendor). Under Section 3.1 , Midstream Co has the right to hold certain meetings with Producer, and at the request of Midstream Co, one of such meetings per year may be held in conjunction with the Approved SWD Vendor to discuss confer regarding planned activities.

 

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Section 18.8 Indemnification in Respect of Trucked Volumes . Without in any way limiting any indemnification obligation otherwise set forth in the Agreement, the Parties agree that the indemnification obligations of Producer set forth in Section 7.3 and Section 15.2(b) apply to Trucked Volumes delivered to a SWD Trucking Facility.

Section 18.9 Invoices from Approved SWD Vendor . The Party that engages the Transporter shall take all reasonable measures to ensure that the invoicing procedures that Midstream Co has negotiated with the Approved SWD Vendor are used, including notation of the geographic area to which the services pertain. Midstream Co shall provide a written copy of such procedures to Producer upon request.

7. Amendments to Agreement Addendum .

7.1 The description of the “Dedication Area” appearing in Agreement Addendum is hereby amended and restated in its entirety to read as follows:

 

Dedication Area  

The following areas within Weld County, Colorado

   

Township

  

Range

  

Sections

    
  5N    65W    13, S/2 21, S/2 22, 23-27, 33-36   
  5N    64W    7-9, 16-21, 28-33   
  4N    67W    25, 36   
  4N    66W    1-3, 8-36   
  4N    65W    ALL   
  4N    64W    4-9, 16-21, 28-31   
  Except and excluding the wells, leases, and other acreage described in the property exhibits attached to the Releases of Dedication.

7.1 The specifications regarding the “Individual Second Phase Rate” appearing in the Agreement Addendum are hereby amended and restated in their entirety and the specifications regarding the “Individual Disposal By Truck Fee” are hereby added to the Agreement Addendum as follows:

 

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Individual Second
Phase Fee
   An amount equal to the actual costs incurred by Midstream Co for providing the Second Phase Services multiplied by 1.05.
Individual
Disposal by Truck
Fee
   An amount equal to the actual costs incurred by Midstream Co for providing the Trucked Water Services with respect to Dedicated Production delivered to a SWD Trucking Facility multiplied by 1.05.

8. Confidentiality . Pursuant to Section 17.11 of the Agreement (which appears in the Agreement Terms and Conditions), the Parties have agreed to treat the information exchanged in connection with and the provisions of the Agreement as confidential. In addition, confidential treatment has been requested with the Securities and Exchange Commission for the pricing terms of the Agreement and the Parties agree to take appropriate measures to abide by the requirements imposed by the Securities and Exchange Commission to preserve such confidential treatment, if granted.

9. Confirmation . The provisions of the Agreement, as amended by this Amendment, shall remain in full force and effect following the effectiveness of this Amendment. No provision of the Agreement is amended or otherwise modified hereby, except as expressly stated herein.

10. No Waiver . The execution, delivery and effectiveness of this Amendment shall not operate as a waiver of any right, power or remedy of any Party to the Agreement, nor constitute a waiver of any provision of the Agreement. On and after the Amendment Effective Time, this Amendment shall for all purposes constitute a part of the Agreement.

11. Counterparts . This Amendment may be executed in any number of counterparts, and each such counterpart hereof shall be deemed to be an original instrument, but all of such counterparts shall constitute for all purposes one agreement. Any signature hereto delivered by a Party by electronic mail shall be deemed an original signature hereto.

12. Governing Law . This Amendment shall be governed by and construed in accordance with the laws of the State, excluding any conflicts of law rule or principle that might refer construction of such provisions to the laws of another jurisdiction.

(Signature Pages follow)

 

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IN WITNESS WHEREOF, the Parties hereto have executed this Amendment to the Agreement in duplicate originals to be effective as of the Amendment Effective Time.

 

“Producer”
NOBLE ENERGY, INC.
By:  

/s/ Gary W. Willingham

  Gary W. Willingham
  Executive Vice President

STATE OF TEXAS                    )

                                                     ) ss.

COUNTY OF HARRIS              )

The foregoing instrument was acknowledged before me this 29th day of August 2016, by Gary W. Willingham as Executive Vice President of Noble Energy, Inc., a Delaware corporation.

WITNESS my hand and official seal.

My commission expires: 05/05/2018

 

/s/ Joanne Garner

Notary Public

 

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“Midstream Co”

GUNNISON RIVER DEVCO LP

  By: Gunnison River DevCo GP LLC
       By: Noble Midstream Services, LLC
                     By:   /s/ Terry R. Gerhart                        
                             Terry R. Gerhart
                             Chief Executive Officer

STATE OF TEXAS                    )

                                                     ) ss.

COUNTY OF HARRIS              )

The foregoing instrument was acknowledged before me this 25th day of August 2016, by Terry R. Gerhart as Chief Executive Officer of Noble Midstream Services, LLC, which is the sole member of Gunnison River DevCo GP LLC, which is the general partner of Gunnison River DevCo LP, a Delaware limited partnership.

WITNESS my hand and official seal.

My commission expires: 05/05/2018

 

/s/ Joanne Garner

Notary Public

 

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Exhibit 10.16.1.1

Execution Version

When Recorded, Mail To:

Attn: DJ Land Manager

1625 Broadway, Suite 2200

Denver, CO 80202

AMENDMENT 01

TO

THAT CERTAIN

SECOND AMENDED AND RESTATED

PRODUCED WATER SERVICES AGREEMENT

G REELEY C RESCENT

C ONTRACT N UMBER :LAGC05-PW

This AMENDMENT 01 (this “ Amendment ”) shall be effective among Noble Energy, Inc., a Delaware corporation (the “ Producer ”) and Laramie River DevCo LP, a Delaware limited partnership, together with its permitted successors and assigns (“ Midstream Co ”) as of September 1, 2016 (the “ Amendment Effective Time ”). This Amendment modifies that certain Second Amended and Restated Produced Water Services Agreement, effective as of March 31, 2016 (the “ Agreement ”), which has been given contract number LAGC05-PW and is comprised of (i) that certain Second Amended and Restated Agreement Terms and Conditions Relating to Produced Water Services (the “ Agreement Terms and Conditions ”), last updated March 31, 2016, together with (ii) that certain Second Amended and Restated Agreement Addendum 05 (the “ Agreement Addendum ”), effective as of March 31, 2016. The Agreement Terms and Conditions, the Agreement Addendum and this Amendment shall constitute one contract and shall be the Agreement of the Parties.

WHEREAS, capitalized terms used herein have the meanings assigned to such terms in the Agreement Terms and Conditions.

WHEREAS, Section 16.1 of the Agreement (which appears in the Agreement Terms and Conditions) prohibits either Party to the Agreement from assigning its rights and obligations, except that Producer may assign its rights and obligations to any Person (herein, the “ Transferee ”) to whom Producer transfers Dedicated Properties so long as such Transferee assumes the rights and obligations of Producer with respect to such transferred Dedicated Properties.

WHEREAS, pursuant to that certain Purchase and Sale Agreement, by and among Producer, NBL Energy Royalties, Inc. and Noble Energy WyCo, LLC, collectively as the Seller, and Synergy Resources Corporation, as Purchaser (the “ Transferee ”), executed May 2, 2016 with an effective time of April 1, 2016 at 12:01 AM, Producer agreed to sell approximately 30,000 acres of the Dedicated Properties to the Transferee.

WHEREAS, pursuant to Section 2.1 of the Agreement Terms and Conditions, Producer has dedicated and committed to deliver to Midstream Co under the Agreement, as and when produced, all of the Dedicated Production and agreed not to deliver any Dedicated Production to any other gatherer, purchaser, or other Person prior to delivery to Midstream Co at the Receipt Points.


WHEREAS, at certain times prior to or after connection of the Individual System to a particular Well or Separator Facility, the Individual System may not be available to accept deliveries of Dedicated Production.

WHEREAS, during such times, Producer remains obligated to deliver the Dedicated Production to Midstream Co and Midstream Co remains obligated to arrange for the disposal of such Dedicated Production, and the Parties desire to amend the Agreement to provide for the flexibility required.

WHEREAS, the Parties agree and acknowledge that amendments to the Agreement Terms and Conditions set forth herein constitute an amendment only to the Agreement and not to any other agreement in respect of produced water services to which Producer or Midstream Co is a party.

NOW, THEREFORE, in consideration of the foregoing recitals, which are incorporated herein and the mutual agreements in the Agreement, Midstream Co and Producer hereby agree as follows:

 

  1. Amendments to Article 1 .

1.1 The following defined terms are hereby amended and restated in their entirety to read as follows:

Facility Segment ” means each segment of an Individual System comprised of facilities beginning at a Receipt Point and ending at an Internal Transfer Point. If an Individual System does not contain any such distinct segment, then the term Facility Segment shall be synonymous with Individual System.

Individual Fee ” means the aggregate of the Individual First Phase Fee, the Individual Second Phase Fee and the Individual Disposal by Truck Fee; provided that for purposes of the annual escalation in the Individual Fee described in Section 6.2(b) , such term shall not include any Reimbursed Amount.

Individual Second Phase Fee ” means the Monthly fee for providing Second Phase Services at a particular Individual System, as set forth opposite the heading “Individual Second Phase Fee” on the applicable Midstream Agreement Addendum; provided that the Individual Second Phase Fee shall accrue only with respect to Services performed by Midstream Co on Product flowing through an Individual System.

Individual System ” means the portion of the System beginning at the Receipt Points and ending at the Delivery Points. The Individual Systems in existence on the Effective Date are more particularly described in writing between Producer and Midstream Co. Additional Individual Systems may be added to the System from time to time in satisfaction of the needs identified by Producer and evidenced in writing between Producer and Midstream Co.

 

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Other System Fuel ” means any natural gas delivered into Midstream Co’s custody by Producer pursuant to a Transaction Document between Producer and Midstream Co and measured and used as fuel by Midstream Co.

1.2 The defined terms “Drip Condensate”, “Gas”, “Gas System”, “Individual Second Phase Rate”, and “Other Services” are hereby deleted.

1.3 Clauses (a) and (b) of the defined term “Dedicated Production” are hereby amended and restated to read as follows: “(a) Product owned by Producer or an Affiliate of Producer and produced from a Well within the Dedication Area that is operated by Producer or an Affiliate under the Control of Producer, (b)  Reserved , and”.

1.4 The defined term “Product” is hereby amended by inserting the following sentence at the end of such definition:

“In the event Producer exercises its Trucking Election, the term “Product” shall refer to all water that is accepted for delivery at a SWD Trucking Facility for the account of Midstream Co.”

1.5 The defined term “Services” is hereby amended by deleting “and (g)” at the end of clause (f) and inserting in place thereof the following: “, (g) Trucked Water Services and (h)”.

1.6 The following new definitions shall be added to Article 1 in alphabetical order:

Approved SWD Vendor ” means Midstream Co or a Third Party, in either case, as mutually agreed in writing by the Parties; provided, however, that if an Approved SWD Vendor rejects any Product delivered to a SWD Trucking Facility for quality or safety reasons, then Midstream Co shall be entitled to select an alternative vendor to take title to, store, handle, and dispose of such Product without obtaining Producer’s approval of such vendor, and such vendor shall be deemed an Approved SWD Vendor for such purpose.

Individual Disposal by Truck Fee ” means the Monthly fee for providing Trucked Water Services with respect to Dedicated Production delivered to a SWD Trucking Facility, as set forth opposite the heading “Individual Disposal by Truck Fee” on the applicable Midstream Agreement Addendum; provided that the Individual Disposal by Truck Fee shall accrue only with respect to Dedicated Production delivered by truck to a SWD Trucking Facility.

Pipeline Unavailability ” means any time after the Trucked Water Services Commencement Date during which the Individual System is not capable of accepting or transporting volumes of Product for any reason, including Pre-Connection Water that exceeds the capacity of the Individual System, Pre-Connection Water at a time when the Individual System is not yet online, curtailments on the Individual System and interruptions of Service.

 

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Pre-Connection Water ” means the water-based solution that flows back to the surface during and after the completion of hydraulic fracturing a Well.

Pre-Connection Period ” means, with respect to a Well, the period of time commencing on the Day Pre-Connection Water begins to return to the surface and ending on the earlier of the date (a) on which such Well or the Separator Facility to which such Well is connected is connected to the Individual System or (b) that is 10 Days following the first Day of the applicable Pre-Connection Period.

SWD Trucking Facility ” means an Approved SWD Vendor’s saltwater disposal well that Midstream Co has designated for disposal of Dedicated Production that is transported by truck.

Transporter ” means a wastewater truck transportation company engaged by Producer or Midstream Co, as applicable, to transport Trucked Volumes to the SWD Trucking Facility.

Trucked Volumes ” has the meaning given to it in Section 18.3(a) .

Trucked Water Services ” means, at any time when Producer has exercised its Trucking Election, Midstream Co shall make arrangements for the disposal of Dedicated Production that arrives by truck at the applicable SWD Trucking Facility. In addition, in connection with a Trucking Election, (a) during a Pre-Connection Period, if Producer requests and Midstream Co agrees, then with Producer’s reasonable cooperation, Midstream Co will arrange for the dispatching of the applicable trucks to the applicable SWD Trucking Facility and otherwise coordinate the water hauling trucks and (b) at all other times during a Pipeline Unavailability in which Producer has made a Trucking Election, Midstream Co shall arrange for the dispatching of the applicable trucks to the applicable SWD Trucking Facility and otherwise coordinate the water hauling trucks.

Trucked Water Services Commencement Date ” has the meaning given to it in Section 2.3(b) .

Trucking Election ” has the meaning given to it in Section 2.3(b) .

2. Amendments to Article 2 .

2.1 Section 2.3(b) of the Agreement Terms and Conditions is hereby amended and restated in its entirety to read: “(b) following the date set forth in writing between Producer and Midstream Co (such date as it may be updated by Midstream Co and Producer, the “Trucked Water Services Commencement Date”), Producer may elect to deliver or have delivered Dedicated Production directly to a SWD Trucking Facility during any Pipeline Unavailability as provided in Section 18.2 (the “ Trucking Election ”); and”.

 

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2.2 Section 2.3(d) of the Agreement Terms and Conditions is hereby amended and restated in its entirety to read: “(d) to pool, communitize or unitize Producer’s interests with respect to Dedicated Production”.

2.3 Section 2.4(b)(iv) of the Agreement Terms and Conditions is amended and restated in its entirety to read: “(iv) Reserved. ”.

3. Amendments to Article 3 .

3.1 Section 3.1(e) of the Agreement Terms and Conditions is hereby amended by deleting the sentence that reads as follows “In the sole discretion of each Person serving as a Midstream Co under a Midstream Agreement Addendum, such Midstream Co may work with any other Midstream Co to prepare and deliver a System Plan jointly.” and inserting in place thereof the following sentence: “Midstream Co may, in its sole discretion, work with OpCo or any of OpCo’s subsidiaries to prepare and deliver a System Plan jointly with such other entity or entities.”

3.2 Section 3.2 of the Agreement Terms and Conditions is hereby amended by inserting the following new clause (e)  immediately following clause (d)  of such Section 3.2 :

“(e) Substation and Interconnection Facilities . The obligations of Midstream Co hereunder to design and construct the Individual System and to perform the Services do not include the design or construction of any substation or other interconnecting facilities required to procure electricity for the Individual System. If a substation or any other interconnecting facility is required in order for Midstream Co to perform its obligations hereunder, Midstream Co and Producer shall enter into a separate agreement setting forth each Party’s responsibilities in connection therewith, including an allocation of responsibility for all associated costs and expenses.”

4. Amendments to Article 6 .

4.1 Clause (ii) of Section 6.1 of the Agreement Terms and Conditions is hereby amended and restated in its entirety to read as follows: “(ii) the Individual Second Phase Fee, if any, applicable to Second Phase Services performed within the Dedication Area,”

4.2 Section 6.1 of the Agreement Terms and Conditions is further amended by deleting the period at the end of such Section 6.1 and inserting in place thereof the following clause: “and (iv) the Individual Disposal by Truck Fee, if any.”

4.3 Section 6.3(d) of the Agreement Terms and Conditions is hereby amended and restated in its entirety to read as follows: “ Other System Fuel . Midstream Co may elect to use Other System Fuel as fuel to operate the Individual System, or to generate electricity for the operation of the Individual System and shall account for any Other System Fuel used by Midstream Co. Producer, at its sole cost and expense, shall procure all fuel, in addition to Other System Fuel used by Midstream Co, if any, required to operate the Individual System or to generate electricity for the operation of the Individual System and arrange for transportation of such fuel to the Individual System.”.

 

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5. Amendments to Article 8 . Clause (d) of Section 8.2 of the Agreement Terms and Conditions is hereby amended by deleting the phrase “and Section 17.11 shall” and inserting in place thereof the clause: “, Section 17.11 and Section 18.7 shall”.

6. New Article 18 . The following new Article 18 shall be inserted immediately following the conclusion of Article 17 of the Agreement Terms and Conditions:

Article 18

Pipeline Unavailability

Section 18.1 Effectiveness; Pipeline Unavailability . The Parties agree that this Article 18 shall be effective as of the Trucked Water Services Commencement Date.

(a) It is the intention of the Parties to use the Individual System for all Dedicated Production. To accommodate operational upsets and periods of increased flow (such as the occurrence of Pre-Connection Water during the Pre-Connection Period), the Parties have agreed under Section 2.3(b) that, during Pipeline Unavailability, Producer shall elect to either (i) exercise the Trucking Election or (ii) cease producing Dedicated Production until the end of the Pipeline Unavailability, as provided in Section 18.2 . To the extent Producer exercises its Trucking Election, this Article 18 shall govern with respect to the Trucked Volumes and the other matters set forth herein, rather than Articles 4 , 7 (other than Section 7.3 as it applies to Trucked Volumes delivered to a SWD Trucking Facility that fail to meet the quality requirements of Section 18.3(d) ) and 9 and Sections 5.1 , 5.2 , 5.3 , 5.4 , and 5.6 .

(b) The Parties agree that during Pipeline Unavailability, Producer shall not have the right to temporary services under Sections 3.3(a) and 3.3(b) of the Agreement or to a temporary release under Section 2.4(b)(ii) of the Agreement except to the extent that Midstream Co fails to provide Trucked Water Services.

(c) If Midstream Co fails to connect a Well or a Separator Facility to the Individual System by the On-Line Deadline, Producer may exercise its Trucking Election for the duration of the resulting Pipeline Unavailability, rather than exercising its right to a permanent release under Section 2.4(a)(i) and Section 2.4(a)(ii) . If Midstream Co fails to connect a Well or Separator Facility to the Individual System by the On-Line Deadline, but prior to such On-Line Deadline, the Parties have agreed that the connection of the Well or Separator Facility did not need to occur until after Pre-Connection Water has started flowing, then the resulting Pipeline Unavailability shall not entitle Producer to a permanent release under Section 2.4(a)(i) and Section 2.4(a)(ii) until such time as the agreed upon connection date has passed.

Section 18.2 Exercise of Trucking Election .

(a) If Producer expects a Well or Separator Facility to be completed prior to its connection to the Individual System, resulting in a Pipeline

 

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Unavailability, Producer shall give Midstream Co at least 72 hours’ advance notice that Dedicated Production is expected to be produced from the applicable Well or available at the applicable Separator Facility. After the applicable Well or Separator Facility is connected to the Individual System, following the Trucked Water Services Commencement Date, Midstream Co shall deliver notice to Producer of any Pipeline Unavailability pursuant to Section 5.5 .

(b) Once Producer or Midstream Co, as applicable, has delivered notice to the other Party that a Pipeline Unavailability is expected (or has occurred), Producer will inform Midstream Co whether Producer elects to exercise its Trucking Election or to cease producing Dedicated Production until the end of the Pipeline Unavailability. If Producer exercises the Trucking Election during the Pre-Connection Period, Producer shall coordinate with the water hauling trucks and arrange for transportation of the Dedicated Production to the SWD Trucking Facility at its sole cost and expense until the end of the Pre-Connection Period. At all other times during a Pipeline Unavailability, including when Pre-Connection Water is occurring after the expiration of the Pre-Connection Period, Midstream Co shall coordinate with the water hauling trucks and arrange for transportation of the Dedicated Production to the SWD Trucking Facility as part of the Trucked Water Services unless Producer has elected to cease producing Dedicated Production.

Section 18.3 Delivery of and Title to Trucked Volumes .

(a) Trucked Water Services Obligation . Upon the exercise of a Trucking Election, Midstream Co shall cause an Approved SWD Vendor to accept delivery of, take title to, store, handle and dispose of Dedicated Production that is delivered by truck to a SWD Trucking Facility. Upon the exercise of a Trucking Election, Midstream Co may, in its sole discretion, also accept delivery of, take title to, store, handle and dispose of other Product delivered by truck to a SWD Trucking Facility. The volumes that are actually delivered by truck shall be referred to as “Trucked Volumes”.

(b) Consistent Volumes . The Trucked Volumes delivered to the applicable SWD Trucking Facility shall be at a rate of delivery that is as uniform as reasonably possible in accordance with Producer’s drilling, completion, and frac schedule.

(c) Title and Custody . Title to and risk of loss to the Trucked Volumes and all contents thereof shall pass from Producer to Approved SWD Vendor when delivered into Approved SWD Vendor’s storage tanks at the SWD Trucking Facility, unless the Parties otherwise agree in writing.

(d) Quality . Producer represents and warrants that all Trucked Volumes delivered to an Approved SWD Vendor may lawfully be disposed of in Class II disposal wells. Midstream Co’s performance of Trucked Water Services for any Trucked Volumes that do not meet such requirement shall not relieve Producer from any liability for Producer’s breach of the foregoing representation and warranty nor serve as a waiver of any rights or remedies available to Midstream Co therefor.

 

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(e) Prohibition on Skimming . The Party that coordinates the water hauling trucks shall direct the Transporter not to skim, transfer, sell, or otherwise remove hydrocarbons or Trucked Volumes from trucks after receipt by such Transporter and prior to such Trucked Volumes being received by the Approved SWD Vendor. If the Approved SWD Vendor alleges that the Trucked Volumes delivered appear to have been handled in a manner inconsistent with the foregoing sentence, Producer shall corporate with Midstream Co and the Approved SWD Vendor in a review and analysis and, if required by the Approved SWD Vendor, take corrective action in a timely manner. If Transporters engaged by Producer fail to comply with the directions received, then Midstream Co may direct Producer to use a different Transporter.

Section 18.4 Unavailability of a SWD Trucking Facility . If for any reason there is a disruption of receipts at the SWD Trucking Facility, the Parties shall work in good faith to find a mutually agreeable resolution. If for any reason Midstream Co receives reimbursements in respect of trucking as a result of an originally scheduled SWD Trucking Facility being unable to accept deliveries, Midstream Co shall disclose such reimbursements on the applicable invoice and pass through such reimbursements to Producer if Producer paid the costs of the applicable Transporter directly.

Section 18.5 Testing; Non-Conforming Product . If requested by Midstream Co, Producer shall obtain water samples for analyses and retain appropriate qualified personnel to conduct analyses following methodologies considered appropriate in the industry or shall permit Midstream Co to obtain such samples.

Section 18.6 Producer’s Grant of Access . Producer hereby grants to Midstream Co, and shall grant to each Transporter, without warranty of title, either express or implied, to the extent that it may lawfully and is contractually permitted to do so without the incurrence of additional expense, the rights of ingress and egress with respect to, and the right to access, all lands constituting Dedicated Properties for the purposes of (a) transporting Trucked Volumes, and (b) obtaining water samples as described in Section 18.5 .

Section 18.7 Information . Producer agrees that information it supplies to Midstream Co regarding anticipated volumes of Dedicated Production and Trucked Volumes may be shared with an Approved SWD Vendor to the extent required by the applicable Approved SWD Vendor to assist in planning and operations, and Producer agrees to provide additional information regarding anticipated volumes of Dedicated Production and Trucked Volumes to the extent requested by Midstream Co in response to inquiries from an Approved SWD Vendor (so long as Midstream Co is required to deliver the requested information in order to comply with Midstream Co’s contractual arrangements with such Approved SWD Vendor). Under Section 3.1 , Midstream Co has the right to hold certain meetings with Producer, and at the request of Midstream Co, one of such meetings per year may be held in conjunction with the Approved SWD Vendor to discuss confer regarding planned activities.

 

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Section 18.8 Indemnification in Respect of Trucked Volumes . Without in any way limiting any indemnification obligation otherwise set forth in the Agreement, the Parties agree that the indemnification obligations of Producer set forth in Section 7.3 and Section 15.2(b) apply to Trucked Volumes delivered to a SWD Trucking Facility.

Section 18.9 Invoices from Approved SWD Vendor . The Party that engages the Transporter shall take all reasonable measures to ensure that the invoicing procedures that Midstream Co has negotiated with the Approved SWD Vendor are used, including notation of the geographic area to which the services pertain. Midstream Co shall provide a written copy of such procedures to Producer upon request.

7. Amendments to Agreement Addendum .

7.1 The description of the “Dedication Area” appearing in Agreement Addendum 05 is hereby amended and restated in its entirety to read as follows:

 

Dedication Area   The following areas within Weld County, Colorado
   

                 Township                

  

Range

  

Sections

    
  T7N    R65W    ALL   
  T6N    R65W    1-5, 9-17, 20-29, 33-36   
  T5N    R67W    13, 14, 23-26, 35, 36   
  T5N    R66W    18-20, 25, S/2 26, 27-36   
  T5N    R65W    1-3, E/2 4, 14   
  T4N    R67W    1,2, 26, 27, 34, 35   
  Except and excluding the wells, leases, and other acreage described in the property exhibits attached to the Releases of Dedication.

7.1 The specifications regarding the “Individual Second Phase Rate” appearing in the Agreement Addendum are hereby amended and restated in their entirety and the specifications regarding the “Individual Disposal By Truck Fee” are hereby added to the Agreement Addendum as follows:

 

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   Individual Second Phase Fee  

An amount equal to the actual costs incurred by Midstream Co for providing the Second Phase Services multiplied by 1.05.

 

   Individual Disposal by Truck Fee  

An amount equal to the actual costs incurred by Midstream Co for providing the Trucked Water Services with respect to Dedicated Production delivered to a SWD Trucking Facility multiplied by 1.05.

 

8. Confidentiality . Pursuant to Section 17.11 of the Agreement (which appears in the Agreement Terms and Conditions), the Parties have agreed to treat the information exchanged in connection with and the provisions of the Agreement as confidential. In addition, confidential treatment has been requested with the Securities and Exchange Commission for the pricing terms of the Agreement and the Parties agree to take appropriate measures to abide by the requirements imposed by the Securities and Exchange Commission to preserve such confidential treatment, if granted.

9. Confirmation . The provisions of the Agreement, as amended by this Amendment, shall remain in full force and effect following the effectiveness of this Amendment. No provision of the Agreement is amended or otherwise modified hereby, except as expressly stated herein.

10. No Waiver . The execution, delivery and effectiveness of this Amendment shall not operate as a waiver of any right, power or remedy of any Party to the Agreement, nor constitute a waiver of any provision of the Agreement. On and after the Amendment Effective Time, this Amendment shall for all purposes constitute a part of the Agreement.

11. Counterparts . This Amendment may be executed in any number of counterparts, and each such counterpart hereof shall be deemed to be an original instrument, but all of such counterparts shall constitute for all purposes one agreement. Any signature hereto delivered by a Party by electronic mail shall be deemed an original signature hereto.

12. Governing Law . This Amendment shall be governed by and construed in accordance with the laws of the State, excluding any conflicts of law rule or principle that might refer construction of such provisions to the laws of another jurisdiction.

(Signature Pages follow)

 

Amendment 01 – Page 10

Second Amended and Restated Produced Water Services Agreement

Laramie River Produced Water Agreement

LAGC05-PW


IN WITNESS WHEREOF, the Parties hereto have executed this Amendment to the Agreement in duplicate originals to be effective as of the Amendment Effective Time.

 

“Producer”
NOBLE ENERGY, INC.
By:  

/s/ Gary W. Willingham

  Gary W. Willingham
  Executive Vice President

 

STATE OF TEXAS      )
     )  ss.
COUNTY OF HARRIS      )

The foregoing instrument was acknowledged before me this 29th day of August 2016, by Gary W. Willingham as Executive Vice President of Noble Energy, Inc., a Delaware corporation.

WITNESS my hand and official seal.

My commission expires: 05/05/2018

 

/s/ Joanne Garner

Notary Public

 

Amendment 01 – Signature Page 1

Second Amended and Restated Produced Water Services Agreement

Laramie River Produced Water Agreement

LAGC05-PW


“Midstream Co”

LARAMIE RIVER DEVCO LP

  By: Laramie River DevCo GP LLC
       By: Noble Midstream Services, LLC
                     By:   /s/ Terry R. Gerhart                        
                             Terry R. Gerhart
                             Chief Executive Officer

STATE OF TEXAS                    )

                                                     ) ss.

COUNTY OF HARRIS              )

The foregoing instrument was acknowledged before me this 25th day of August 2016, by Terry R. Gerhart as Chief Executive Officer of Noble Midstream Services, LLC, which is the sole member of Laramie River DevCo GP LLC, which is the general partner of Laramie River DevCo LP, a Delaware limited partnership.

WITNESS my hand and official seal.

My commission expires: 05/05/2018

 

/s/ Joanne Garner

Notary Public

 

Amendment 01 – Signature Page 2

Second Amended and Restated Produced Water Services Agreement

Laramie River Produced Water Agreement

LAGC05-PW

Exhibit 10.18.2

When Recorded, Mail To:

Attn: DJ Land Manager

1625 Broadway, Suite 2200

Denver, CO 80202

AMENDMENT 01

TO

THAT CERTAIN

SECOND AMENDED AND RESTATED

FRESH WATER SERVICES AGREEMENT

W ELLS R ANCH

C ONTRACT NUMBER : CRWR01-FW

This AMENDMENT 01 (this “ Amendment ”) shall be effective among Noble Energy, Inc., a Delaware corporation (the “ Producer ”) and Colorado River DevCo LP, a Delaware limited partnership, together with its permitted successors and assigns (“ Midstream Co ”) as of September 1, 2016 (the “ Amendment Effective Date ”). This Amendment modifies that certain Second Amended and Restated Fresh Water Services Agreement, effective as of March 31, 2016 (the “ Agreement ”), which has been given contract number CRWR01-FW and is comprised of (i) that certain Second Amended and Restated Agreement Terms and Conditions Relating to Fresh Water Services (the “ Agreement Terms and Conditions ”), last updated March 31, 2016, together with (ii) that certain Second Amended and Restated Agreement Addendum 01 (the “ Agreement Addendum ”), effective as of March 31, 2016. The Agreement Terms and Conditions, the Agreement Addendum and this Amendment shall constitute one contract and shall be the Agreement of the Parties.

WHEREAS, the Parties acknowledge that the purpose of this Amendment is to correct an error in certain specifications set out in Section 7.1(a) of the Agreement Terms and Conditions, and incorporated in the Agreement Addendum, and to make certain other technical modifications.

WHEREAS, the Parties agree and acknowledge that amendments set forth herein constitute an amendment only to the Agreement and not to any other agreement in respect of fresh water services to which Producer is a party.


NOW, THEREFORE, in consideration of the foregoing recitals, which are incorporated herein and the mutual agreements in the Agreement, Midstream Co and Producer hereby agree as follows:

1. Amendments .

1.1 Section 1.1 of the Agreement (which appears in the Agreement Terms and Conditions) is hereby amended by amending and restating the following defined terms in their entirety to read as follows:

Facility Segment ” means each segment of an Individual System comprised of facilities that can be operated independently of other Facility Segments. For example, a Facility Segment may begin at a Receipt Point and end at a Retention Facility, begin at a Retention Facility and end at a Delivery Point or have another configuration. If an Individual System does not contain any such distinct segment, then the term Facility Segment shall be synonymous with Individual System.

Individual Fee ” means the aggregate of the Individual First Phase Fee and the Individual Second Phase Fee; provided that for purposes of the annual escalation in the Individual Fee described in Section 6.2(b) , such term shall not include any Reimbursed Amount.

Individual System ” means the portion of the System beginning at the Receipt Points and ending at the Delivery Points. The Individual Systems in existence on the Effective Date are more particularly described in writing between Producer and Midstream Co. Additional Individual Systems may be added to the System from time to time in satisfaction of the needs identified by Producer and evidenced in writing between Producer and Midstream Co.

1.2 Section 2.4(b)(iv) of the Agreement (which appears in the Agreement Terms and Conditions) is amended and restated in its entirety to read: “(iv) Reserved. ”.

1.3 Section 3.1(e) of the Agreement (which appears in the Agreement Terms and Conditions) is hereby amended by deleting the sentence that reads as follows “In the sole discretion of each Person serving as a Midstream Co under a Midstream Agreement Addendum, such Midstream Co may work with any other Midstream Co to prepare and deliver a System Plan jointly.” and inserting in place thereof the following sentence: “Midstream Co may, in its sole discretion, work with OpCo or any of OpCo’s subsidiaries to prepare and deliver a System Plan jointly with such other entity or entities.”

1.4 Section 6.3 of the Agreement (which appears in the Agreement Terms and Conditions) is hereby amended and restated in its entirety to read as follows:

Section 6.3 Producer, at its sole cost and expense, shall procure all fuel used by Midstream Co, if any, required to operate the Individual System or to generate electricity for the operation of the Individual System and arrange for transportation of such fuel to the Individual System.

1.5 The last row of the chart in Section 7.1(a) of the Agreement Terms and Conditions is hereby amended and restated in its entirety to read as follows:

 

Particulate Size    100 nominal micron    100 nominal micron      

 

Amendment 01 – Page 2

Second Amended and Restated Fresh Water Services Agreement

Colorado River Fresh Water Agreement

CRWR01-FW


2. Clarification Regarding Second Phase Services . Midstream Co shall have the option to deliver Fresh Water through an Internal Transfer Point as described in the definition of “Services” in the Agreement (which appears in the Agreement Terms and Conditions) or directly to a Delivery Point without transporting Fresh Water through an Internal Transfer Point. The Individual Second Phase Fee shall be equal to zero for any Fresh Water that Midstream Co elects to deliver directly to a Delivery Point without passing through an Internal Transfer Point.

3. Confidentiality . Pursuant to Section 17.11 of the Agreement (which appears in the Agreement Terms and Conditions), the Parties have agreed to treat the information exchanged in connection with and the provisions of the Agreement as confidential. In addition, confidential treatment has been requested with the Securities and Exchange Commission for the pricing terms of the Agreement, and the Parties agree to take appropriate measures to abide by the requirements imposed by the Securities and Exchange Commission to preserve such confidential treatment, if granted.

4. Confirmation . The provisions of the Agreement, as amended by this Amendment, shall remain in full force and effect following the effectiveness of this Amendment. No provision of the Agreement is amended or otherwise modified hereby, except as expressly stated herein.

5. No Waiver . The execution, delivery and effectiveness of this Amendment shall not operate as a waiver of any right, power or remedy of any Party to the Agreement, nor constitute a waiver of any provision of the Agreement. On and after the Amendment Effective Date, this Amendment shall for all purposes constitute a part of the Agreement.

6. Counterparts . This Amendment may be executed in any number of counterparts, and each such counterpart hereof shall be deemed to be an original instrument, but all of such counterparts shall constitute for all purposes one agreement. Any signature hereto delivered by a Party by electronic mail shall be deemed an original signature hereto.

7. Governing Law . This Amendment shall be governed by and construed in accordance with the laws of the State, excluding any conflicts of law rule or principle that might refer construction of such provisions to the laws of another jurisdiction.

(Signature Pages follow)

 

Amendment 01 – Page 3

Second Amended and Restated Fresh Water Services Agreement

Colorado River Fresh Water Agreement

CRWR01-FW


IN WITNESS WHEREOF, the Parties hereto have executed this Amendment to the Agreement in duplicate originals to be effective as of the Amendment Effective Date.

 

“Producer”
NOBLE ENERGY, INC.
By:   /s/ Gary W. Willingham
  Gary W. Willingham
  Executive Vice President

 

STATE OF TEXAS    )   
   )    ss.
COUNTY OF HARRIS    )   

The foregoing instrument was acknowledged before me this 29th day of August 2016, by Gary W. Willingham as Executive Vice President of Noble Energy, Inc., a Delaware corporation.

WITNESS my hand and official seal.

My commission expires: 05/05/2018

 

/s/ Joanne Garner
Notary Public

 

Amendment 01 – Signature Page 1

Second Amended and Restated Fresh Water Services Agreement

Colorado River Fresh Water Agreement

CRWR01-FW


“Midstream Co”
COLORADO RIVER DEVCO LP
   By: Colorado River DevCo GP LLC
      By: Noble Midstream Services, LLC
         By:    /s/ Terry R. Gerhart
            Terry R. Gerhart
            Chief Executive Officer

 

STATE OF TEXAS    )   
   )    ss.
COUNTY OF HARRIS    )   

The foregoing instrument was acknowledged before me this 25th day of August 2016, by Terry R. Gerhart as Chief Executive Officer of Noble Midstream Services, LLC, which is the sole member of Colorado River DevCo GP LLC, which is the general partner of Colorado River DevCo LP, a Delaware limited partnership.

WITNESS my hand and official seal.

My commission expires: 05/05/2018

 

/s/ Joanne Garner
Notary Public

 

Amendment 01 – Signature Page 2

Second Amended and Restated Fresh Water Services Agreement

Colorado River Fresh Water Agreement

CRWR01-FW

Exhibit 10.19.2

Execution Version

When Recorded, Mail To:

Attn: DJ Land Manager

1625 Broadway, Suite 2200

Denver, CO 80202

AMENDMENT 01

TO

THAT CERTAIN

SECOND AMENDED AND RESTATED

FRESH WATER SERVICES AGREEMENT

N ORTHERN C OLORADO

C ONTRACT N UMBER : SJNC02-FW

This AMENDMENT 01 (this “ Amendment ”) shall be effective as among Noble Energy, Inc., a Delaware corporation (the “ Producer ”) and San Juan River DevCo LP, a Delaware limited partnership, together with its permitted successors and assigns (“ Midstream Co ”) as of September 1, 2016 (the “ Amendment Effective Date ”). This Amendment modifies that certain Second Amended and Restated Fresh Water Services Agreement, effective as of March 31, 2016 (the “ Agreement ”), which has been given contract number SJNC02-FW and is comprised of (i) that certain Second Amended and Restated Agreement Terms and Conditions Relating to Fresh Water Services (the “ Agreement Terms and Conditions ”), last updated March 31, 2016, together with (ii) that certain Second Amended and Restated Agreement Addendum 02 (the “ Agreement Addendum ”), effective as of March 31, 2016. The Agreement Terms and Conditions, the Agreement Addendum 02 and this Amendment shall constitute one contract and shall be the Agreement of the Parties.

WHEREAS, capitalized terms used herein have the meanings assigned to such terms in the Agreement Terms and Conditions.

WHEREAS, Section 17.5 of the Agreement (which appears in the Agreement Terms and Conditions) permits the Parties to amend provisions of the Agreement relating to fees by a written agreement that is executed by all Parties and is expressly identified as an amendment or modification.

WHEREAS, the Parties agree and acknowledge that amendments to the Agreement Terms and Conditions set forth herein constitute an amendment only to the Agreement and not to any other agreement in respect of fresh water services to which Producer is a party.

WHEREAS, pursuant to the definition of “Services” Midstream Co is only required to accept a volume of Fresh Water at all Receipt Points on an Individual System that does not


exceed the capacity then available in the applicable Individual System and Producer’s Fresh Water requirements in Northern Colorado exceed the capacity currently available on the Individual System servicing Northern Colorado.

WHEREAS, Producer has requested and Midstream Co has agreed to expand the Individual System by adding a new Retention Facility, and Midstream Co has contracted with a Third Party vendor to finance and construct such facility for Midstream Co’s use in satisfying Producer’s demand.

WHEREAS, Producer and Midstream Co also desire to correct an error in certain specifications set out in Section 7.1(a) of the Agreement Terms and Conditions.

NOW, THEREFORE, in consideration of the foregoing recitals, which are incorporated herein and the mutual agreements in the Agreement, Midstream Co and Producer hereby agree as follows:

1. Amendments .

1.1 Section 1.1 of the Agreement (which appears in the Agreement Terms and Conditions) is hereby amended by inserting the following definitions in alphabetical order:

Commitment Period ” means the period from the date that operations at Starlight Pond commence until the fifth anniversary thereof.

Excused Amount ” means the sum of the following, stated in Barrels: (i) if Starlight Pond is not ready to accept deliveries of and store Fresh Water by September 1, 2016, then 30,000 Barrels for each Day, beginning on September 2, 2016, when Starlight Pond is not in service or is otherwise unavailable to store Fresh Water until Starlight Pond is placed in service and available to store Fresh Water, and (ii) if during the Commitment Period, the number of Unavailable Days exceeds an aggregate of more than 60 Days, the product of (A) 10,000,000 Barrels less the amount determined pursuant to clause (i) of this definition, and (B) a fraction, the numerator of which is equal to the number of Unavailable Days during the Commitment Period in excess of 60 Days, and the denominator of which is equal to the total number of Days in the Commitment Period.

Shortfall Amount ” has the meaning set forth in Section 6.1(b) .

Shortfall Payment ” has the meaning set forth in Section 6.1(b) .

Starlight Pond ” has the meaning agreed by the Parties in writing.

Starlight Pond Fee ” means the fee calculated as described in clause (iv) of Section 6.1(a) .

Starlight Pond Rate ” means the Monthly rate for providing Services at the Starlight Pond, as set forth opposite the heading “Starlight Pond Rate” on the applicable Midstream Agreement Addendum.

 

Amendment 01 – Page 2

Second Amended and Restated Fresh Water Services Agreement

San Juan River Fresh Water Agreement

SJNC02-FW


Unavailable Day ” means any Day on which Starlight Pond is not in service or is otherwise unavailable to store Fresh Water, other than due to any normal and routine maintenance, repair, or modification projects for which Midstream Co provided Producer with at least 30 Days’ advance notice or any event of Force Majeure.

1.2 Section 2.4(b)(iv) of the Agreement (which appears in the Agreement Terms and Conditions) is amended and restated in its entirety to read: “(iv) Reserved. ”.

1.3 Section 1.1 of the Agreement (which appears in the Agreement Terms and Conditions) is hereby amended by amending and restating the following defined terms in their entirety to read as follows:

Facility Segment ” means each segment of an Individual System comprised of facilities that can be operated independently of other Facility Segments. For example, a Facility Segment may begin at a Receipt Point and end at a Retention Facility, begin at a Retention Facility and end at a Delivery Point or have another configuration. If an Individual System does not contain any such distinct segment, then the term Facility Segment shall be synonymous with Individual System.

Individual Fee ” means the aggregate of the Individual First Phase Fee, the Individual Second Phase Fee and the Starlight Pond Fee; provided that for purposes of the annual escalation in the Individual Fee described in Section 6.2(b) , such term shall not include any Reimbursed Amount.

Individual System ” means the portion of the System beginning at the Receipt Points and ending at the Delivery Points. The Individual Systems in existence on the Effective Date are more particularly described in writing between Producer and Midstream Co. Additional Individual Systems may be added to the System from time to time in satisfaction of the needs identified by Producer and evidenced in writing between Producer and Midstream Co.

1.4 Section 3.1(e) of the Agreement (which appears in the Agreement Terms and Conditions) is hereby amended by deleting the sentence that reads as follows “In the sole discretion of each Person serving as a Midstream Co under a Midstream Agreement Addendum, such Midstream Co may work with any other Midstream Co to prepare and deliver a System Plan jointly.” and inserting in place thereof the following sentence: “Midstream Co may, in its sole discretion, work with OpCo or any of OpCo’s subsidiaries to prepare and deliver a System Plan jointly with such other entity or entities.”

1.5 Section 6.1 of the Agreement (which appears in the Agreement Terms and Conditions) is hereby amended and restated in its entirety to read as follows:

Section 6.1 Fees .

(a) Payment of Fees . Producer shall pay Midstream Co in accordance with the terms of this Agreement, for each Month in which Midstream Co provides Services with respect to the Fresh Water within an Individual System that is subject to this Agreement, an amount equal to the sum of (i) the product of (x) the aggregate quantity of such Fresh

 

Amendment 01 – Page 3

Second Amended and Restated Fresh Water Services Agreement

San Juan River Fresh Water Agreement

SJNC02-FW


Water, stated in Barrels, delivered to Producer by Midstream Co at the applicable Internal Transfer Point for such Fresh Water within the applicable Individual System during such Month, multiplied by (y) the applicable Individual First Phase Rate, (ii) the Individual Second Phase Fee, if any, applicable to Second Phase Services performed within the Dedication Area, (iii) an amount equal to Producer’s allocated portion of the actual costs incurred by Midstream Co for electricity required to provide Services, such allocation to be based upon the aggregate volumes of Fresh Water received by Midstream Co, and (iv) the product of (x) the aggregate quantity of such Fresh Water, stated in Barrels, extracted from Starlight Pond for the account of Producer during such Month, multiplied by (y) the applicable Starlight Pond Rate corresponding to the cumulative volumes of Fresh Water extracted from the Starlight Pond by Midstream Co (whether for the account of Producer or a Third Party) since the first date Services are provided at the Starlight Pond.

(b) Minimum Volume to Starlight Pond . If the aggregate quantity of Fresh Water, stated in Barrels, extracted from Starlight Pond for the account of Producer and Third Parties during the Commitment Period is equal to or less than 10,000,000 Barrels, then Midstream Co shall include on an invoice delivered to Producer within 60 days of the termination of the Commitment Period, and Producer shall pay Midstream Co in accordance with the payment provisions of Article X , an amount equal to the product of (i) an amount equal to (x) 10,000,000 Barrels, minus (y) the aggregate quantity of Fresh Water, stated in Barrels, extracted from Starlight Pond by Midstream Co for the account of Producer and Third Parties, minus (z) the Excused Amount (the amount determined pursuant to this clause (i), the “ Shortfall Amount ”), multiplied by (ii) the Starlight Pond Rate that would have applied had the Shortfall Amount actually been extracted from Starlight Pond by Midstream Co for the account of Producer (the “ Shortfall Payment ”). Upon receipt of such Shortfall Payment, Midstream Co shall credit the Shortfall Payment against any Starlight Pond Fees that would otherwise be owed by Producer to Midstream Co pursuant to Section 6.1(a) during the two-year period beginning on the expiration of the Commitment Period and ending on the earlier of (1) the date that such credit has been exhausted and (2) the expiration of such two-year period. During such time, Midstream Co shall continue to prepare and deliver invoices to Producer as required by Article X , except that such invoices shall show (1) the amount due and owing from Producer for the applicable Invoice Month, (2) how much of the amount due under the applicable invoice has been set off against the Shortfall Payment, and (3) how much of the Shortfall Payment remains to be credited back to Producer.

1.6 Section 6.3 of the Agreement (which appears in the Agreement Terms and Conditions) is hereby amended and restated in its entirety to read as follows:

Section 6.3 Producer, at its sole cost and expense, shall procure all fuel used by Midstream Co, if any, required to operate the Individual System or to generate electricity for the operation of the Individual System and arrange for transportation of such fuel to the Individual System.

 

Amendment 01 – Page 4

Second Amended and Restated Fresh Water Services Agreement

San Juan River Fresh Water Agreement

SJNC02-FW


1.7 The last row of the chart in Section 7.1(a) of the Agreement (which appears in the Agreement Terms and Conditions) is hereby amended and restated in its entirety to read as follows:

 

Particulate Size

   100 nominal micron    100 nominal micron      

1.8 Section 8.1 of the Agreement (which appears in the Agreement Terms and Conditions) is hereby amended and restated in its entirety to read as follows:

Section 8.1 Term . The term of this Agreement commenced on January 1, 2015, which is the original effective date of the Parties’ agreement regarding the matters set forth herein, and this Agreement remain in effect until January 1, 2030 (the “ Initial Term ”) and thereafter on a Year to Year basis until terminated by Midstream Co or Producer effective upon the expiration of the Initial Term or the expiration of any Year thereafter upon notice no less than 90 Days prior to the expiration of the Initial Term or the expiration of any Year thereafter (such period of time, the “ Term ”). Notwithstanding the foregoing, (a) with respect to the OpCo Agreement Addendum only, this Agreement shall continue for so long as any Original Midstream Co remains a Party under any Midstream Agreement Addendum then in effect and shall automatically terminate at such time as no Original Midstream Co remains a Party to any Midstream Agreement Addendum, and (b) if title to all or any portion of the Individual System is transferred to Timbro Land and Cattle Company, LLC pursuant to the Commercial Water Sales Contract, dated October 10, 2012, between Timbro Land and Cattle Company, LLC and Noble Energy, Inc., then this Agreement shall automatically terminate effective as of the date such title transfers.

1.9 The following specifications regarding a “Starlight Pond Rate” shall be added to Agreement Addendum immediately following the specifications for “Individual Second Phase Fee”:

 

Starlight

Pond Rate

 

Cumulative volumes of Fresh Water extracted from the

Starlight Pond by Midstream Co (whether for the

account of Producer or a Third Party) since the first

date Services are provided at the Starlight Pond

 

Starlight Pond Rate

  Up to and including 3,000,000 Barrels   $1.05/ Barrel
  3,000,001 to 10,000,000 Barrels   $0.32/ Barrel
  Greater than 10,000,000 Barrels   $0.21/ Barrel

2. Clarification Regarding Second Phase Services . Midstream Co shall have the option to deliver Fresh Water through an Internal Transfer Point as described in the definition of “Services” in the Agreement (which appears in the Agreement Terms and Conditions) or directly to a Delivery Point without transporting Fresh Water through an Internal Transfer Point. The Individual Second Phase Fee shall be equal to zero for any Fresh Water that Midstream Co elects to deliver directly to a Delivery Point without passing through an Internal Transfer Point.

 

Amendment 01 – Page 5

Second Amended and Restated Fresh Water Services Agreement

San Juan River Fresh Water Agreement

SJNC02-FW


3. Records . Midstream Co shall keep records of the cumulative volumes of Fresh Water extracted from the Starlight Pond (whether for the account of Producer or a Third Party) since the first date Services are provided at the Starlight Pond, and Producer’s audit rights under the Agreement (which appear in the Agreement Terms and Conditions) shall extend to such records.

4. Confidentiality . Pursuant to Section 17.11 of the Agreement (which appears in the Agreement Terms and Conditions), the Parties have agreed to treat the information exchanged in connection with and the provisions of the Agreement as confidential. In addition, confidential treatment has been requested with the Securities and Exchange Commission for the pricing terms of the Agreement, and the Parties agree to take appropriate measures to abide by the requirements imposed by the Securities and Exchange Commission to preserve such confidential treatment, if granted.

5. Confirmation . The provisions of the Agreement, as amended by this Amendment, shall remain in full force and effect following the effectiveness of this Amendment. No provision of the Agreement is amended or otherwise modified hereby, except as expressly stated herein.

6. No Waiver . The execution, delivery and effectiveness of this Amendment shall not operate as a waiver of any right, power or remedy of any Party to the Agreement, nor constitute a waiver of any provision of the Agreement. On and after the Amendment Effective Date, this Amendment shall for all purposes constitute a part of the Agreement.

7. Counterparts . This Amendment may be executed in any number of counterparts, and each such counterpart hereof shall be deemed to be an original instrument, but all of such counterparts shall constitute for all purposes one agreement. Any signature hereto delivered by a Party by electronic mail shall be deemed an original signature hereto.

8. Governing Law . This Amendment shall be governed by and construed in accordance with the laws of the State, excluding any conflicts of law rule or principle that might refer construction of such provisions to the laws of another jurisdiction.

(Signature Pages follow)

 

Amendment 01 – Page 6

Second Amended and Restated Fresh Water Services Agreement

San Juan River Fresh Water Agreement

SJNC02-FW


IN WITNESS WHEREOF, the Parties hereto have executed this Amendment to the Agreement in duplicate originals to be effective as of the Amendment Effective Date.

“Producer”

 

NOBLE ENERGY, INC.
By:  

/s/ Gary W. Willingham

  Gary W. Willingham
  Executive Vice President

 

STATE OF TEXAS       )   
      ) ss.   
COUNTY OF HARRIS       )   

The foregoing instrument was acknowledged before me this 29th day of August 2016, by Gary W. Willingham as Executive Vice President of Noble Energy, Inc., a Delaware corporation.

WITNESS my hand and official seal.

My commission expires: 05/05/2018

 

/s/ Joanne Garner

Notary Public

 

Amendment 01 – Signature Page 1

Second Amended and Restated Fresh Water Services Agreement

San Juan River Fresh Water Agreement

SJNC02-FW


“Midstream Co”
SAN JUAN RIVER DEVCO LP
  By: San Juan River DevCo GP LLC
              By: Noble Midstream Services, LLC
    By:  

/s/ Terry R. Gerhart

 
                 Terry R. Gerhart
                 Chief Executive Officer

 

STATE OF TEXAS       )   
      ) ss.   
COUNTY OF HARRIS       )   

The foregoing instrument was acknowledged before me this 25th day of August 2016, by Terry R. Gerhart as Chief Executive Officer of Noble Midstream Services, LLC, which is the sole member of San Juan River DevCo GP LLC, which is the general partner of San Juan River DevCo LP, a Delaware limited partnership.

WITNESS my hand and official seal.

My commission expires: 05/05/2018

 

/s/ Joanne Garner

Notary Public

 

Amendment 01 – Signature Page 2

Second Amended and Restated Fresh Water Services Agreement

San Juan River Fresh Water Agreement

SJNC02-FW

Exhibit 10.20.2

When Recorded, Mail To:

Attn: DJ Land Manager

1625 Broadway, Suite 2200

Denver, CO 80202

AMENDMENT 01

TO

THAT CERTAIN

SECOND AMENDED AND RESTATED

FRESH WATER SERVICES AGREEMENT

M USTANG

CONTRACT NUMBER: GRMU03-FW

This AMENDMENT 01 (this “ Amendment ”) shall be effective among Noble Energy, Inc., a Delaware corporation (the “ Producer ”) and Green River DevCo LP, a Delaware limited partnership, together with its permitted successors and assigns (“ Midstream Co ”) as of September 1, 2016 (the “ Amendment Effective Date ”). This Amendment modifies that certain Second Amended and Restated Fresh Water Services Agreement, effective as of March 31, 2016 (the “ Agreement ”), which has been given contract number GRMU03-FW and is comprised of (i) that certain Second Amended and Restated Agreement Terms and Conditions Relating to Fresh Water Services (the “ Agreement Terms and Conditions ”), last updated March 31, 2016, together with (ii) that certain Second Amended and Restated Agreement Addendum 03 (the “ Agreement Addendum ”), effective as of March 31, 2016. The Agreement Terms and Conditions, the Agreement Addendum and this Amendment shall constitute one contract and shall be the Agreement of the Parties.

WHEREAS, the Parties acknowledge that the purpose of this Amendment is to correct an error in certain specifications set out in Section 7.1(a) of the Agreement Terms and Conditions, and incorporated in the Agreement Addendum, and to make certain other technical modifications.

WHEREAS, the Parties agree and acknowledge that amendments set forth herein constitute an amendment only to the Agreement and not to any other agreement in respect of fresh water services to which Producer is a party.


NOW, THEREFORE, in consideration of the foregoing recitals, which are incorporated herein and the mutual agreements in the Agreement, Midstream Co and Producer hereby agree as follows:

 

  1. Amendments .

1.1 Section 1.1 of the Agreement (which appears in the Agreement Terms and Conditions) is hereby amended by amending and restating the following defined terms in their entirety to read as follows:

Facility Segment ” means each segment of an Individual System comprised of facilities that can be operated independently of other Facility Segments. For example, a Facility Segment may begin at a Receipt Point and end at a Retention Facility, begin at a Retention Facility and end at a Delivery Point or have another configuration. If an Individual System does not contain any such distinct segment, then the term Facility Segment shall be synonymous with Individual System.

Individual Fee ” means the aggregate of the Individual First Phase Fee and the Individual Second Phase Fee; provided that for purposes of the annual escalation in the Individual Fee described in Section 6.2(b) , such term shall not include any Reimbursed Amount.

Individual System ” means the portion of the System beginning at the Receipt Points and ending at the Delivery Points. The Individual Systems in existence on the Effective Date are more particularly described in writing between Producer and Midstream Co. Additional Individual Systems may be added to the System from time to time in satisfaction of the needs identified by Producer and evidenced in writing between Producer and Midstream Co.

1.2 Section 2.4(b)(iv) of the Agreement (which appears in the Agreement Terms and Conditions) is amended and restated in its entirety to read: “(iv) Reserved. ”.

1.3 Section 3.1(e) of the Agreement (which appears in the Agreement Terms and Conditions) is hereby amended by deleting the sentence that reads as follows “In the sole discretion of each Person serving as a Midstream Co under a Midstream Agreement Addendum, such Midstream Co may work with any other Midstream Co to prepare and deliver a System Plan jointly.” and inserting in place thereof the following sentence: “Midstream Co may, in its sole discretion, work with OpCo or any of OpCo’s subsidiaries to prepare and deliver a System Plan jointly with such other entity or entities.”

1.4 Section 6.3 of the Agreement (which appears in the Agreement Terms and Conditions) is hereby amended and restated in its entirety to read as follows:

Section 6.3 Producer, at its sole cost and expense, shall procure all fuel used by Midstream Co, if any, required to operate the Individual System or to generate electricity for the operation of the Individual System and arrange for transportation of such fuel to the Individual System.

1.5 The last row of the chart in Section 7.1(a) of the Agreement Terms and Conditions is hereby amended and restated in its entirety to read as follows:

 

Particulate Size

   100 nominal micron    100 nominal micron      

 

Amendment 01 – Page 2

Second Amended and Restated Fresh Water Services Agreement

Green River Fresh Water Agreement

GRMU03-FW


2. Clarification Regarding Second Phase Services . Midstream Co shall have the option to deliver Fresh Water through an Internal Transfer Point as described in the definition of “Services” in the Agreement (which appears in the Agreement Terms and Conditions) or directly to a Delivery Point without transporting Fresh Water through an Internal Transfer Point. The Individual Second Phase Fee shall be equal to zero for any Fresh Water that Midstream Co elects to deliver directly to a Delivery Point without passing through an Internal Transfer Point.

3. Confidentiality . Pursuant to Section 17.11 of the Agreement (which appears in the Agreement Terms and Conditions), the Parties have agreed to treat the information exchanged in connection with and the provisions of the Agreement as confidential. In addition, confidential treatment has been requested with the Securities and Exchange Commission for the pricing terms of the Agreement, and the Parties agree to take appropriate measures to abide by the requirements imposed by the Securities and Exchange Commission to preserve such confidential treatment, if granted.

4. Confirmation . The provisions of the Agreement, as amended by this Amendment, shall remain in full force and effect following the effectiveness of this Amendment. No provision of the Agreement is amended or otherwise modified hereby, except as expressly stated herein.

5. No Waiver . The execution, delivery and effectiveness of this Amendment shall not operate as a waiver of any right, power or remedy of any Party to the Agreement, nor constitute a waiver of any provision of the Agreement. On and after the Amendment Effective Date, this Amendment shall for all purposes constitute a part of the Agreement.

6. Counterparts . This Amendment may be executed in any number of counterparts, and each such counterpart hereof shall be deemed to be an original instrument, but all of such counterparts shall constitute for all purposes one agreement. Any signature hereto delivered by a Party by electronic mail shall be deemed an original signature hereto.

7. Governing Law . This Amendment shall be governed by and construed in accordance with the laws of the State, excluding any conflicts of law rule or principle that might refer construction of such provisions to the laws of another jurisdiction.

(Signature Pages follow)

 

Amendment 01 – Page 3

Second Amended and Restated Fresh Water Services Agreement

Green River Fresh Water Agreement

GRMU03-FW


IN WITNESS WHEREOF, the Parties hereto have executed this Amendment to the Agreement in duplicate originals to be effective as of the Amendment Effective Date.

 

“Producer”

 

NOBLE ENERGY, INC.

By:   /s/ Gary W. Willingham
 

Gary W. Willingham

Executive Vice President

 

STATE OF TEXAS    )   
   ) ss.   
COUNTY OF HARRIS    )   

The foregoing instrument was acknowledged before me this 29th day of August 2016, by Gary W. Willingham as Executive Vice President of Noble Energy, Inc., a Delaware corporation.

WITNESS my hand and official seal.

My commission expires: 05/05/2018

 

/s/ Joanne Garner
Notary Public

 

Amendment 01 – Signature Page 1

Second Amended and Restated Fresh Water Services Agreement

Green River Fresh Water Agreement

GRMU03-FW


“Midstream Co”

GREEN RIVER DEVCO LP

By: Green River DevCo GP LLC

By: Noble Midstream Services, LLC

 

By:   /s/ Terry R. Gerhart
 

Terry R. Gerhart

Chief Executive Officer

 

 

STATE OF TEXAS    )   
   ) ss.   
COUNTY OF HARRIS    )   

The foregoing instrument was acknowledged before me this 25th day of August 2016, by Terry R. Gerhart as Chief Executive Officer of Noble Midstream Services, LLC, which is the sole member of Green River DevCo GP LLC, which is the general partner of Green River DevCo LP, a Delaware limited partnership.

WITNESS my hand and official seal.

My commission expires: 05/05/2018

 

/s/ Joanne Garner
Notary Public

 

Amendment 01 – Signature Page 2

Second Amended and Restated Fresh Water Services Agreement

Green River Fresh Water Agreement

GRMU03-FW

Exhibit 10.21.2

When Recorded, Mail To:

Attn: DJ Land Manager

1625 Broadway, Suite 2200

Denver, CO 80202

AMENDMENT 01

TO

THAT CERTAIN

SECOND AMENDED AND RESTATED

FRESH WATER SERVICES AGREEMENT

B RONCO

C ONTRACT N UMBER : GUBR04-FW

This AMENDMENT 01 (this “ Amendment ”) shall be effective among Noble Energy, Inc., a Delaware corporation (the “ Producer ”) and Gunnison River DevCo LP, a Delaware limited partnership, together with its permitted successors and assigns (“ Midstream Co ”) as of September 1, 2016 (the “ Amendment Effective Time ”). This Amendment modifies that certain Second Amended and Restated Fresh Water Services Agreement, effective as of March 31, 2016 (the “ Agreement ”), which has been given contract number GUBR04-FW and is comprised of (i) that certain Second Amended and Restated Agreement Terms and Conditions Relating to Fresh Water Services (the “ Agreement Terms and Conditions ”), last updated March 31, 2016, together with (ii) that certain Second Amended and Restated Agreement Addendum 04 (the “ Agreement Addendum ”), effective as of March 31, 2016. The Agreement Terms and Conditions, the Agreement Addendum and this Amendment shall constitute one contract and shall be the Agreement of the Parties.

WHEREAS, capitalized terms used herein have the meanings assigned to such terms in the Agreement Terms and Conditions.

WHEREAS, Section 16.1 of the Agreement (which appears in the Agreement Terms and Conditions) prohibits either Party to the Agreement from assigning its rights and obligations, except that Producer may assign its rights and obligations to any Person (herein, the “ Transferee ”) to whom Producer transfers Dedicated Properties so long as such Transferee assumes the rights and obligations of Producer with respect to such transferred Dedicated Properties.

WHEREAS, pursuant to that certain Purchase and Sale Agreement, by and among Producer, NBL Energy Royalties, Inc. and Noble Energy WyCo, LLC, collectively as the Seller, and Synergy Resources Corporation, as Purchaser (the “ Transferee ”), executed May 2, 2016 with an effective time of April 1, 2016 at 12:01 AM, Producer agreed to sell approximately 30,000 acres of the Dedicated Properties to the Transferee.


WHEREAS, the Parties acknowledge that the purpose of this Amendment is to correct an error in certain specifications set out in Section 7.1(a) of the Agreement Terms and Conditions, and incorporated in the Agreement Addendum, and to make certain other technical modifications.

WHEREAS, the Parties agree and acknowledge that amendments to the Agreement Terms and Conditions set forth herein constitute an amendment only to the Agreement and not to any other agreement in respect of fresh water services to which Producer is a party.

NOW, THEREFORE, in consideration of the foregoing recitals, which are incorporated herein and the mutual agreements in the Agreement, Midstream Co and Producer hereby agree as follows:

 

  1. Amendments .

1.1 Section 1.1 of the Agreement (which appears in the Agreement Terms and Conditions) is hereby amended by amending and restating the following defined terms in their entirety to read as follows:

Facility Segment ” means each segment of an Individual System comprised of facilities that can be operated independently of other Facility Segments. For example, a Facility Segment may begin at a Receipt Point and end at a Retention Facility, begin at a Retention Facility and end at a Delivery Point or have another configuration. If an Individual System does not contain any such distinct segment, then the term Facility Segment shall be synonymous with Individual System.

Individual Fee ” means the aggregate of the Individual First Phase Fee and the Individual Second Phase Fee; provided that for purposes of the annual escalation in the Individual Fee described in Section 6.2(b) , such term shall not include any Reimbursed Amount.

Individual System ” means the portion of the System beginning at the Receipt Points and ending at the Delivery Points. The Individual Systems in existence on the Effective Date are more particularly described in writing between Producer and Midstream Co. Additional Individual Systems may be added to the System from time to time in satisfaction of the needs identified by Producer and evidenced in writing between Producer and Midstream Co.

1.2 Section 2.4(b)(iv) of the Agreement (which appears in the Agreement Terms and Conditions) is amended and restated in its entirety to read: “(iv) Reserved. ”.

 

Amendment 01 – Page 2

Second Amended and Restated Fresh Water Services Agreement

Gunnison River Fresh Water Agreement

GUBR04-FW


1.3 Section 3.1(e) of the Agreement (which appears in the Agreement Terms and Conditions) is hereby amended by deleting the sentence that reads as follows “In the sole discretion of each Person serving as a Midstream Co under a Midstream Agreement Addendum, such Midstream Co may work with any other Midstream Co to prepare and deliver a System Plan jointly.” and inserting in place thereof the following sentence: “Midstream Co may, in its sole discretion, work with OpCo or any of OpCo’s subsidiaries to prepare and deliver a System Plan jointly with such other entity or entities.”

1.4 Section 6.3 of the Agreement (which appears in the Agreement Terms and Conditions) is hereby amended and restated in its entirety to read as follows:

Section 6.3 Producer, at its sole cost and expense, shall procure all fuel used by Midstream Co, if any, required to operate the Individual System or to generate electricity for the operation of the Individual System and arrange for transportation of such fuel to the Individual System.

1.5 The last row of the chart in Section 7.1(a) of the Agreement Terms and Conditions is hereby amended and restated in its entirety to read as follows:

 

Particulate Size

   100 nominal micron    100 nominal micron      

1.6 The description of the “Dedication Area” appearing in Agreement Addendum is hereby amended and restated in its entirety to read as follows:

 

Dedication Area                 

   The following areas within Weld County, Colorado
          Township    Range    Sections     
      5N    65W    13, S/2 21, S/2 22, 23-27, 33-36   
      5N    64W    7-9, 16-21, 28-33   
      4N    67W    25, 36   
      4N    66W    1-3, 8-36   
      4N    65W    ALL   
      4N    64W    4-9, 16-21, 28-31   
   Except and excluding the wells, leases, and other acreage described in the property exhibits attached to the Releases of Dedication.

2. Clarification Regarding Second Phase Services . Midstream Co shall have the option to deliver Fresh Water through an Internal Transfer Point as described in the definition of “Services” in the Agreement (which appears in the Agreement Terms and Conditions) or directly to a Delivery Point without transporting Fresh Water through an Internal Transfer Point. The Individual Second Phase Fee shall be equal to zero for any Fresh Water that Midstream Co elects to deliver directly to a Delivery Point without passing through an Internal Transfer Point.

 

Amendment 01 – Page 3

Second Amended and Restated Fresh Water Services Agreement

Gunnison River Fresh Water Agreement

GUBR04-FW


3. Confidentiality . Pursuant to Section 17.11 of the Agreement (which appears in the Agreement Terms and Conditions), the Parties have agreed to treat the information exchanged in connection with and the provisions of the Agreement as confidential. In addition, confidential treatment has been requested with the Securities and Exchange Commission for the pricing terms of the Agreement, and the Parties agree to take appropriate measures to abide by the requirements imposed by the Securities and Exchange Commission to preserve such confidential treatment, if granted.

4. Confirmation . The provisions of the Agreement, as amended by this Amendment, shall remain in full force and effect following the effectiveness of this Amendment. No provision of the Agreement is amended or otherwise modified hereby, except as expressly stated herein.

5. No Waiver . The execution, delivery and effectiveness of this Amendment shall not operate as a waiver of any right, power or remedy of any Party to the Agreement, nor constitute a waiver of any provision of the Agreement. On and after the Amendment Effective Time, this Amendment shall for all purposes constitute a part of the Agreement.

6. Counterparts . This Amendment may be executed in any number of counterparts, and each such counterpart hereof shall be deemed to be an original instrument, but all of such counterparts shall constitute for all purposes one agreement. Any signature hereto delivered by a Party by electronic mail shall be deemed an original signature hereto.

7. Governing Law . This Amendment shall be governed by and construed in accordance with the laws of the State, excluding any conflicts of law rule or principle that might refer construction of such provisions to the laws of another jurisdiction.

(Signature Pages follow)

 

Amendment 01 – Page 4

Second Amended and Restated Fresh Water Services Agreement

Gunnison River Fresh Water Agreement

GUBR04-FW


IN WITNESS WHEREOF, the Parties hereto have executed this Amendment to the Agreement in duplicate originals to be effective as of the Amendment Effective Time.

 

“Producer”

 

NOBLE ENERGY, INC.

By:   /s/ Gary W. Willingham
 

Gary W. Willingham

Executive Vice President

 

STATE OF TEXAS    )   
   ) ss.   
COUNTY OF HARRIS    )   

The foregoing instrument was acknowledged before me this 29th day of August 2016, by Gary W. Willingham as Executive Vice President of Noble Energy, Inc., a Delaware corporation.

WITNESS my hand and official seal.

My commission expires: 05/05/2018

 

/s/ Joanne Garner
Notary Public

 

Amendment 01 – Signature Page 1

Second Amended and Restated Fresh Water Services Agreement

Gunnison River Fresh Water Agreement

GUBR04-FW


“Midstream Co”

GUNNISON RIVER DEVCO LP

By: Gunnison River DevCo GP LLC

By: Noble Midstream Services, LLC

 

By:   /s/ Terry R. Gerhart
 

Terry R. Gerhart

Chief Executive Officer

 

 

STATE OF TEXAS    )   
   ) ss.   
COUNTY OF HARRIS    )   

The foregoing instrument was acknowledged before me this 25th day of August 2016, by Terry R. Gerhart as Chief Executive Officer of Noble Midstream Services, LLC, which is the sole member of Gunnison River DevCo GP LLC, which is the general partner of Gunnison River DevCo LP, a Delaware limited partnership.

WITNESS my hand and official seal.

My commission expires: 05/05/2018

 

/s/ Joanne Garner
Notary Public

 

Amendment 01 – Signature Page 2

Second Amended and Restated Fresh Water Services Agreement

Gunnison River Fresh Water Agreement

GUBR04-FW

Exhibit 10.22.1.1

When Recorded, Mail To:

Attn: DJ Land Manager

1625 Broadway, Suite 2200

Denver, CO 80202

AMENDMENT 01

TO

THAT CERTAIN

SECOND AMENDED AND RESTATED

FRESH WATER SERVICES AGREEMENT

G REELEY C RESCENT

C ONTRACT N UMBER : LAGC05-FW

This AMENDMENT 01 (this “ Amendment ”) shall be effective among Noble Energy, Inc., a Delaware corporation (the “ Producer ”) and Laramie River DevCo LP, a Delaware limited partnership, together with its permitted successors and assigns (“ Midstream Co ”) as of September 1, 2016 (the “ Agreement Effective Time ”). This Amendment modifies that certain Second Amended and Restated Fresh Water Services Agreement, effective as of March 31, 2016 (the “ Agreement ”), which has been given contract number LAGC05-FW and is comprised of (i) that certain Second Amended and Restated Agreement Terms and Conditions Relating to Fresh Water Services (the “ Agreement Terms and Conditions ”), last updated March 31, 2016, together with (ii) that certain Second Amended and Restated Agreement Addendum 05 (the “ Agreement Addendum ”), effective as of March 31, 2016. The Agreement Terms and Conditions, the Agreement Addendum and this Amendment shall constitute one contract and shall be the Agreement of the Parties.

WHEREAS, capitalized terms used herein have the meanings assigned to such terms in the Agreement Terms and Conditions.

WHEREAS, Section 16.1 of the Agreement (which appears in the Agreement Terms and Conditions) prohibits either Party to the Agreement from assigning its rights and obligations, except that Producer may assign its rights and obligations to any Person (herein, the “ Transferee ”) to whom Producer transfers Dedicated Properties so long as such Transferee assumes the rights and obligations of Producer with respect to such transferred Dedicated Properties.

WHEREAS, pursuant to that certain Purchase and Sale Agreement, by and among Producer, NBL Energy Royalties, Inc. and Noble Energy WyCo, LLC, collectively as the Seller, and Synergy Resources Corporation, as Purchaser (the “ Transferee ”), executed May 2, 2016 with an effective time of April 1, 2016 at 12:01 AM, Producer agreed to sell approximately 30,000 acres of the Dedicated Properties to the Transferee.


WHEREAS, the Parties acknowledge that the purpose of this Amendment is to correct an error in certain specifications set out in Section 7.1(a) of the Agreement Terms and Conditions, and incorporated in the Agreement Addendum, and to make certain other technical modifications.

WHEREAS, the Parties agree and acknowledge that amendments to the Agreement Terms and Conditions set forth herein constitute an amendment only to the Agreement and not to any other agreement in respect of fresh water services to which Producer is a party.

NOW, THEREFORE, in consideration of the foregoing recitals, which are incorporated herein and the mutual agreements in the Agreement, Midstream Co and Producer hereby agree as follows:

1. Amendments .

1.1 Section 1.1 of the Agreement (which appears in the Agreement Terms and Conditions) is hereby amended by amending and restating the following defined terms in their entirety to read as follows:

Facility Segment ” means each segment of an Individual System comprised of facilities that can be operated independently of other Facility Segments. For example, a Facility Segment may begin at a Receipt Point and end at a Retention Facility, begin at a Retention Facility and end at a Delivery Point or have another configuration. If an Individual System does not contain any such distinct segment, then the term Facility Segment shall be synonymous with Individual System.

Individual Fee ” means the aggregate of the Individual First Phase Fee and the Individual Second Phase Fee; provided that for purposes of the annual escalation in the Individual Fee described in Section 6.2(b) , such term shall not include any Reimbursed Amount.

Individual System ” means the portion of the System beginning at the Receipt Points and ending at the Delivery Points. The Individual Systems in existence on the Effective Date are more particularly described in writing between Producer and Midstream Co. Additional Individual Systems may be added to the System from time to time in satisfaction of the needs identified by Producer and evidenced in writing between Producer and Midstream Co.

1.2 Section 2.4(b)(iv) of the Agreement (which appears in the Agreement Terms and Conditions) is amended and restated in its entirety to read: “(iv) Reserved. ”.

1.3 Section 3.1(e) of the Agreement (which appears in the Agreement Terms and Conditions) is hereby amended by deleting the sentence that reads as follows “In the sole discretion of each Person serving as a Midstream Co under a Midstream Agreement Addendum,

 

Amendment 01 – Page 2

Second Amended and Restated Fresh Water Services Agreement

Laramie River Fresh Water Agreement

LAGC05-FW


such Midstream Co may work with any other Midstream Co to prepare and deliver a System Plan jointly.” and inserting in place thereof the following sentence: “Midstream Co may, in its sole discretion, work with OpCo or any of OpCo’s subsidiaries to prepare and deliver a System Plan jointly with such other entity or entities.”

1.4 Section 6.3 of the Agreement (which appears in the Agreement Terms and Conditions) is hereby amended and restated in its entirety to read as follows:

Section 6.3 Producer, at its sole cost and expense, shall procure all fuel used by Midstream Co, if any, required to operate the Individual System or to generate electricity for the operation of the Individual System and arrange for transportation of such fuel to the Individual System.

1.5 The last row of the chart in Section 7.1(a) of the Agreement Terms and Conditions is hereby amended and restated in its entirety to read as follows:

 

Particulate Size

 

100 nominal

micron

 

100 nominal

micron

       

1.1 The description of the “Dedication Area” appearing in Agreement Addendum is hereby amended and restated in its entirety to read as follows:

 

Dedication Area  

The following areas within Weld County, Colorado

 

   
      Township    Range    Sections    
     

T7N

   R65W    ALL    
     

T6N

   R65W    1-5, 9-17,  20-29, 33-36    
     

T5N

   R67W    13, 14, 23-26, 35, 36    
     

T5N

   R66W    18-20, 25, S/2 26,  27-36    
     

T5N

   R65W    1-3, E/2 4, 14    
     

T4N

   R67W    1,2, 26, 27, 34, 35    
   
    Except and excluding the wells, leases, and other acreage described in the property exhibits attached to the Releases of Dedication.

2. Clarification Regarding Second Phase Services . Midstream Co shall have the option to deliver Fresh Water through an Internal Transfer Point as described in the definition of “Services” in the Agreement (which appears in the Agreement Terms and Conditions) or directly to a Delivery Point without transporting Fresh Water through an Internal Transfer Point. The Individual Second Phase Fee shall be equal to zero for any Fresh Water that Midstream Co elects to deliver directly to a Delivery Point without passing through an Internal Transfer Point.

3. Confidentiality . Pursuant to Section 17.11 of the Agreement (which appears in the Agreement Terms and Conditions), the Parties have agreed to treat the information exchanged in connection with and the provisions of the Agreement as confidential. In addition,

 

Amendment 01 – Page 3

Second Amended and Restated Fresh Water Services Agreement

Laramie River Fresh Water Agreement

LAGC05-FW


confidential treatment has been requested with the Securities and Exchange Commission for the pricing terms of the Agreement, and the Parties agree to take appropriate measures to abide by the requirements imposed by the Securities and Exchange Commission to preserve such confidential treatment, if granted.

4. Confirmation . The provisions of the Agreement, as amended by this Amendment, shall remain in full force and effect following the effectiveness of this Amendment. No provision of the Agreement is amended or otherwise modified hereby, except as expressly stated herein.

5. No Waiver . The execution, delivery and effectiveness of this Amendment shall not operate as a waiver of any right, power or remedy of any Party to the Agreement, nor constitute a waiver of any provision of the Agreement. On and after the Amendment Effective Time, this Amendment shall for all purposes constitute a part of the Agreement.

6. Counterparts . This Amendment may be executed in any number of counterparts, and each such counterpart hereof shall be deemed to be an original instrument, but all of such counterparts shall constitute for all purposes one agreement. Any signature hereto delivered by a Party by electronic mail shall be deemed an original signature hereto.

7. Governing Law . This Amendment shall be governed by and construed in accordance with the laws of the State, excluding any conflicts of law rule or principle that might refer construction of such provisions to the laws of another jurisdiction.

(Signature Pages follow)

 

Amendment 01 – Page 4

Second Amended and Restated Fresh Water Services Agreement

Laramie River Fresh Water Agreement

LAGC05-FW


IN WITNESS WHEREOF, the Parties hereto have executed this Amendment to the Agreement in duplicate originals to be effective as of the Amendment Effective Time.

 

“Producer”

 

NOBLE ENERGY, INC.

By:   /s/ Gary W. Willingham
 

Gary W. Willingham

 

Executive Vice President

 

STATE OF TEXAS

     )     
     )      ss.
COUNTY OF HARRIS      )     

The foregoing instrument was acknowledged before me this 29th day of August 2016, by Gary W. Willingham as Executive Vice President of Noble Energy, Inc., a Delaware corporation.

WITNESS my hand and official seal.

My commission expires: 05/05/2018

 

/s/ Joanne Garner
Notary Public

 

Amendment 01 – Signature Page 1

Second Amended and Restated Fresh Water Services Agreement

Laramie River Fresh Water Agreement

LAGC05-FW


“Midstream Co”

LARAMIE RIVER DEVCO LP

  By:   Laramie River DevCo GP LLC
      By:   Noble Midstream Services, LLC
          By:   /s/ Terry R. Gerhart
           

Terry R. Gerhart

           

Chief Executive Officer

 

STATE OF TEXAS

     )     
     )      ss.
COUNTY OF HARRIS      )     

The foregoing instrument was acknowledged before me this 25th day of August 2016, by Terry R. Gerhart as Chief Executive Officer of Noble Midstream Services, LLC, which is the sole member of Laramie River DevCo GP LLC, which is the general partner of Laramie River DevCo LP, a Delaware limited partnership.

WITNESS my hand and official seal.

My commission expires: 05/05/2018

 

/s/ Joanne Garner
Notary Public

 

Amendment 01 – Signature Page 2

Second Amended and Restated Fresh Water Services Agreement

Laramie River Fresh Water Agreement

LAGC05-FW

Exhibit 10.24.2

When Recorded, Mail To:

Attn: DJ Land Manager

1625 Broadway, Suite 2200

Denver, CO 80202

AMENDMENT 01

TO

THAT CERTAIN

SECOND AMENDED AND RESTATED

CRUDE OIL GATHERING AGREEMENT

W ELLS R ANCH

C ONTRACT N UMBER : CRWR01-OG

This AMENDMENT 01 (this “ Amendment ”) shall be effective as among Noble Energy, Inc., a Delaware corporation (the “ Producer ”) and Colorado River DevCo LP, a Delaware limited partnership, together with its permitted successors and assigns (“ Midstream Co ”) as of September 1, 2016 (the “ Amendment Effective Time ”). This Amendment modifies that certain Second Amended and Restated Crude Oil Gathering Agreement, effective as of March 31, 2016 (the “ Agreement ”), which has been given contract number CRWR01-OG and is comprised of (i) that certain Second Amended and Restated Agreement Terms and Conditions Relating to Crude Oil Gathering Services (the “ Agreement Terms and Conditions ”), last updated March 31, 2016, together with (ii) that certain Second Amended and Restated Agreement Addendum 01 (the “ Agreement Addendum ”), effective as of March 31, 2016. The Agreement Terms and Conditions, the Agreement Addendum and this Amendment shall constitute one contract and shall be the Agreement of the Parties.

WHEREAS, the Parties acknowledge that the purpose of this Amendment is make certain technical modifications.

WHEREAS, the Parties agree and acknowledge that amendments to the Agreement Terms and Conditions set forth herein constitute an amendment only to the Agreement and not to any other agreement in respect of crude oil gathering services to which Producer is a party.

NOW, THEREFORE, in consideration of the foregoing recitals, which are incorporated herein and the mutual agreements in the Agreement, Midstream Co and Producer hereby agree as follows:


1. Amendments .

1.1 Section 1.1 of the Agreement (which appears in the Agreement Terms and Conditions) is hereby amended by amending and restating the following defined terms in their entirety to read as follows:

Facility Segment ” means each segment of an Individual System comprised of facilities beginning at a Receipt Point and ending at a Delivery Point. If an Individual System does not contain any such distinct segment, then the term Facility Segment shall be synonymous with Individual System.

Individual System ” means the portion of the System beginning at the Receipt Points and ending at the Delivery Points. The Individual Systems in existence on the Effective Date are more particularly described in writing between Producer and Midstream Co. Additional Individual Systems may be added to the System from time to time in satisfaction of the needs identified by Producer and evidenced in writing between Producer and Midstream Co.

Other System Fuel ” means any (a) Gas delivered by Producer to Midstream Co pursuant to a Transaction Document between Producer and Midstream Co related to gas gathering services, or (b) Flash Gas, in each case, measured and used as fuel by Midstream Co.

1.2 Section 1.1 of the Agreement (which appears in the Agreement Terms and Conditions) is further amended by amending and restating clauses (a) and (b) of the defined term “Dedicated Production” to read as follows: “(a) Product owned by Producer or an Affiliate of Producer and produced from a Well within the Dedication Area that is operated by Producer or an Affiliate under the Control of Producer, (b)  Reserved ,”.

1.3 Section 2.3(d) of the Agreement (which appears in the Agreement Terms and Conditions) is hereby amended and restated in its entirety to read: “(d) to pool, communitize or unitize Producer’s interests with respect to Dedicated Production”.

1.4 Section 2.4(b)(iv) of the Agreement (which appears in the Agreement Terms and Conditions) is amended and restated in its entirety to read: “(iv) Reserved. ”.

1.5 Section 3.1(e) of the Agreement (which appears in the Agreement Terms and Conditions) is hereby amended by deleting the sentence that reads as follows “In the sole discretion of each Person serving as a Midstream Co under a Midstream Agreement Addendum, such Midstream Co may work with any other Midstream Co to prepare and deliver a System Plan jointly.” and inserting in place thereof the following sentence: “Midstream Co may, in its sole discretion, work with OpCo or any of OpCo’s subsidiaries to prepare and deliver a System Plan jointly with such other entity or entities.”

 

Amendment 01 – Page 2

Second Amended and Restated Crude Oil Gathering Agreement

Colorado River Crude Oil Gathering Agreement

CRWR01-OG


1.6 Section 3.2 of the Agreement (which appears in the Agreement Terms and Conditions) is hereby amended by inserting the following new clause (e)  immediately following clause (d)  of such Section 3.2 :

“(e) Substation and Interconnection Facilities . The obligations of Midstream Co hereunder to design and construct the Individual System and to perform the Services do not include the design or construction of any substation or other interconnecting facilities required to procure electricity for the Individual System. If a substation or any other interconnecting facility is required in order for Midstream Co to perform its obligations hereunder, Midstream Co and Producer shall enter into a separate agreement setting forth each Party’s responsibilities in connection therewith, including an allocation of responsibility for all associated costs and expenses.”

1.7 Section 4.1 of the Agreement (which appears in the Agreement Terms and Conditions) is hereby amended by deleting both sentences in the middle of clause (g)  that start with the phrase “If, upon any test…” and inserting in place thereof the following two sentences: “If, upon any test, any (i) Measurement Device at the Measurement Point is found to be inaccurate by 2.0% or less or (ii) Measurement Device at the Delivery Point is found to be inaccurate by 0.25% or less, previous readings of such Measurement Device will be considered correct in computing the deliveries of Product under this Agreement. If, upon any test, any (1) Measurement Device at the Measurement Point is found to be inaccurate by more than 2.0% or (2) Measurement Device at the Delivery Point is found to be inaccurate by more than 0.25% (excessive meter factor deviation), such Measurement Device will immediately be removed from service, adjusted, repaired or replaced to record accurately (within the manufacturer’s allowance for error) and reproved prior to returning to service.”

1.8 Section 4.1 of the Agreement (which appears in the Agreement Terms and Conditions) is hereby further amended by deleting the phrase “inaccurate by 0.25% or less, the Owner” from the last sentence of clause (g) and inserting in place thereof the phrase: “inaccurate by 2.0% or less or 0.25% or less, as applicable, the Owner”.

1.9 Section 6.3(d) of the Agreement (which appears in the Agreement Terms and Conditions) is hereby amended and restated in its entirety to read as follows:

(d) Other System Fuel . Midstream Co may elect to use Other System Fuel as fuel to operate the Individual System, or to generate electricity for the operation of the Individual System and shall account for any Other System Fuel used by Midstream Co. Producer, at its sole cost and expense, shall procure all fuel, in addition to Other System Fuel used by Midstream Co, if any, required to operate the Individual System or to generate electricity for the operation of the Individual System and arrange for transportation of such fuel to the Individual System.

2. Confidentiality . Pursuant to Section 17.11 of the Agreement (which appears in the Agreement Terms and Conditions), the Parties have agreed to treat the information exchanged in connection with and the provisions of the Agreement as confidential. In addition, confidential treatment has been requested with the Securities and Exchange Commission for the pricing terms of the Agreement, and the Parties agree to take appropriate measures to abide by the requirements imposed by the Securities and Exchange Commission to preserve such confidential treatment, if granted.

 

Amendment 01 – Page 3

Second Amended and Restated Crude Oil Gathering Agreement

Colorado River Crude Oil Gathering Agreement

CRWR01-OG


3. Confirmation . The provisions of the Agreement, as amended by this Amendment, shall remain in full force and effect following the effectiveness of this Amendment. No provision of the Agreement is amended or otherwise modified hereby, except as expressly stated herein.

4. No Waiver . The execution, delivery and effectiveness of this Amendment shall not operate as a waiver of any right, power or remedy of any Party to the Agreement, nor constitute a waiver of any provision of the Agreement. On and after the Amendment Effective Time, this Amendment shall for all purposes constitute a part of the Agreement.

5. Counterparts . This Amendment may be executed in any number of counterparts, and each such counterpart hereof shall be deemed to be an original instrument, but all of such counterparts shall constitute for all purposes one agreement. Any signature hereto delivered by a Party by electronic mail shall be deemed an original signature hereto.

6. Governing Law . This Amendment shall be governed by and construed in accordance with the laws of the State, excluding any conflicts of law rule or principle that might refer construction of such provisions to the laws of another jurisdiction.

(Signature Pages follow)

 

Amendment 01 – Page 4

Second Amended and Restated Crude Oil Gathering Agreement

Colorado River Crude Oil Gathering Agreement

CRWR01-OG


IN WITNESS WHEREOF, the Parties hereto have executed this Amendment to Agreement in duplicate originals to be effective as of the Amendment Effective Time.

 

“Producer”

 

NOBLE ENERGY, INC.

By:   /s/ Gary W. Willingham
 

Gary W. Willingham

 

Executive Vice President

 

STATE OF TEXAS

     )     
     )      ss.
COUNTY OF HARRIS      )     

The foregoing instrument was acknowledged before me this 29th day of August 2016, by Gary W. Willingham as Executive Vice President of Noble Energy, Inc., a Delaware corporation.

WITNESS my hand and official seal.

My commission expires: 05/05/2018

 

/s/ Joanne Garner
Notary Public

 

Amendment 01 – Signature Page 1

Second Amended and Restated Crude Oil Gathering Agreement

Colorado River Crude Oil Gathering Agreement

CRWR01-OG


“Midstream Co”

COLORADO RIVER DEVCO LP

  By:   Colorado River DevCo GP LLC
      By:   Noble Midstream Services, LLC
          By:   /s/ Terry R. Gerhart
           

Terry R. Gerhart

            Chief Executive Officer

 

STATE OF TEXAS

     )     
     )      ss.
COUNTY OF HARRIS      )     

The foregoing instrument was acknowledged before me this 25th day of August 2016, by Terry R. Gerhart as Chief Executive Officer of Noble Midstream Services, LLC, which is the sole member of Colorado River DevCo GP LLC, which is the general partner of Colorado River DevCo LP, a Delaware limited partnership.

WITNESS my hand and official seal.

My commission expires: 05/05/2018

 

/s/ Joanne Garner
Notary Public

 

Amendment 01 – Signature Page 2

Second Amended and Restated Crude Oil Gathering Agreement

Colorado River Crude Oil Gathering Agreement

CRWR01-OG

Exhibit 10.25.2

When Recorded, Mail To:

Attn: DJ Land Manager

1625 Broadway, Suite 2200

Denver, CO 80202

AMENDMENT 01

TO

THAT CERTAIN

SECOND AMENDED AND RESTATED

CRUDE OIL GATHERING AGREEMENT

N ORTHERN C OLORADO

C ONTRACT N UMBER : CRNC02-OG

This AMENDMENT 01 (this “ Amendment ”) shall be effective as among Noble Energy, Inc., a Delaware corporation (the “ Producer ”) and Colorado River DevCo LP, a Delaware limited partnership, together with its permitted successors and assigns (“ Midstream Co ”) as of September 1, 2016 (the “ Amendment Effective Time ”). This Amendment modifies that certain Second Amended and Restated Crude Oil Gathering Agreement, effective as of March 31, 2016 (the “ Agreement ”), which has been given contract number CRNC02-OG and is comprised of (i) that certain Second Amended and Restated Agreement Terms and Conditions Relating to Crude Oil Gathering Services (the “ Agreement Terms and Conditions ”), last updated March 31, 2016, together with (ii) that certain Second Amended and Restated Agreement Addendum 02 (the “ Agreement Addendum ”), effective as of March 31, 2016. The Agreement Terms and Conditions, the Agreement Addendum and this Amendment shall constitute one contract and shall be the Agreement of the Parties.

WHEREAS, the Parties acknowledge that the purpose of this Amendment is make certain technical modifications.

WHEREAS, the Parties agree and acknowledge that amendments to the Agreement Terms and Conditions set forth herein constitute an amendment only to the Agreement and not to any other agreement in respect of crude oil gathering services to which Producer is a party.


NOW, THEREFORE, in consideration of the foregoing recitals, which are incorporated herein and the mutual agreements in the Agreement, Midstream Co and Producer hereby agree as follows:

1. Amendments .

1.1 Section 1.1 of the Agreement (which appears in the Agreement Terms and Conditions) is hereby amended by amending and restating the following defined terms in their entirety to read as follows:

Facility Segment ” means each segment of an Individual System comprised of facilities beginning at a Receipt Point and ending at a Delivery Point. If an Individual System does not contain any such distinct segment, then the term Facility Segment shall be synonymous with Individual System.

Individual System ” means the portion of the System beginning at the Receipt Points and ending at the Delivery Points. The Individual Systems in existence on the Effective Date are more particularly described in writing between Producer and Midstream Co. Additional Individual Systems may be added to the System from time to time in satisfaction of the needs identified by Producer and evidenced in writing between Producer and Midstream Co.

Other System Fuel ” means any (a) Gas delivered by Producer to Midstream Co pursuant to a Transaction Document between Producer and Midstream Co related to gas gathering services, or (b) Flash Gas, in each case, measured and used as fuel by Midstream Co.

1.2 Section 1.1 of the Agreement (which appears in the Agreement Terms and Conditions) is further amended by amending and restating clauses (a) and (b) of the defined term “Dedicated Production” to read as follows: “(a) Product owned by Producer or an Affiliate of Producer and produced from a Well within the Dedication Area that is operated by Producer or an Affiliate under the Control of Producer, (b) Reserved,”.

1.3 Section 2.3(d) of the Agreement (which appears in the Agreement Terms and Conditions) is hereby amended and restated in its entirety to read: “(d) to pool, communitize or unitize Producer’s interests with respect to Dedicated Production”.

1.4 Section 2.4(b)(iv) of the Agreement (which appears in the Agreement Terms and Conditions) is amended and restated in its entirety to read: “(iv) Reserved.”.

1.5 Section 3.1(e) of the Agreement (which appears in the Agreement Terms and Conditions) is hereby amended by deleting the sentence that reads as follows “In the sole discretion of each Person serving as a Midstream Co under a Midstream Agreement Addendum, such Midstream Co may work with any other Midstream Co to prepare and deliver a System Plan jointly.” and inserting in place thereof the following sentence: “Midstream Co may, in its sole discretion, work with OpCo or any of OpCo’s subsidiaries to prepare and deliver a System Plan jointly with such other entity or entities.”

 

Amendment 01 – Page 2

Second Amended and Restated Crude Oil Gathering Agreement

Colorado River Crude Oil Gathering Agreement (NoCo)

CRNC02-OG


1.6 Section 3.2 of the Agreement (which appears in the Agreement Terms and Conditions) is hereby amended by inserting the following new clause (e) immediately following clause (d) of such Section 3.2:

“(e) Substation and Interconnection Facilities. The obligations of Midstream Co hereunder to design and construct the Individual System and to perform the Services do not include the design or construction of any substation or other interconnecting facilities required to procure electricity for the Individual System. If a substation or any other interconnecting facility is required in order for Midstream Co to perform its obligations hereunder, Midstream Co and Producer shall enter into a separate agreement setting forth each Party’s responsibilities in connection therewith, including an allocation of responsibility for all associated costs and expenses.”

1.7 Section 6.3(d) of the Agreement (which appears in the Agreement Terms and Conditions) is hereby amended and restated in its entirety to read as follows:

(d) Other System Fuel . Midstream Co may elect to use Other System Fuel as fuel to operate the Individual System, or to generate electricity for the operation of the Individual System and shall account for any Other System Fuel used by Midstream Co. Producer, at its sole cost and expense, shall procure all fuel, in addition to Other System Fuel used by Midstream Co, if any, required to operate the Individual System or to generate electricity for the operation of the Individual System and arrange for transportation of such fuel to the Individual System.

2. Confidentiality . Pursuant to Section 17.11 of the Agreement (which appears in the Agreement Terms and Conditions), the Parties have agreed to treat the information exchanged in connection with and the provisions of the Agreement as confidential. In addition, confidential treatment has been requested with the Securities and Exchange Commission for the pricing terms of the Agreement, and the Parties agree to take appropriate measures to abide by the requirements imposed by the Securities and Exchange Commission to preserve such confidential treatment, if granted.

3. Confirmation . The provisions of the Agreement, as amended by this Amendment, shall remain in full force and effect following the effectiveness of this Amendment. No provision of the Agreement is amended or otherwise modified hereby, except as expressly stated herein.

4. No Waiver . The execution, delivery and effectiveness of this Amendment shall not operate as a waiver of any right, power or remedy of any Party to the Agreement, nor constitute a waiver of any provision of the Agreement. On and after the Amendment Effective Time, this Amendment shall for all purposes constitute a part of the Agreement.

5. Counterparts . This Amendment may be executed in any number of counterparts, and each such counterpart hereof shall be deemed to be an original instrument, but all of such counterparts shall constitute for all purposes one agreement. Any signature hereto delivered by a Party by electronic mail shall be deemed an original signature hereto.

 

Amendment 01 – Page 3

Second Amended and Restated Crude Oil Gathering Agreement

Colorado River Crude Oil Gathering Agreement (NoCo)

CRNC02-OG


6. Governing Law . This Amendment shall be governed by and construed in accordance with the laws of the State, excluding any conflicts of law rule or principle that might refer construction of such provisions to the laws of another jurisdiction.

(Signature Pages follow)

 

Amendment 01 – Page 4

Second Amended and Restated Crude Oil Gathering Agreement

Colorado River Crude Oil Gathering Agreement (NoCo)

CRNC02-OG


IN WITNESS WHEREOF, the Parties hereto have executed this Amendment to the Agreement in duplicate originals to be effective as of the Amendment Effective Time.

 

“Producer”
NOBLE ENERGY, INC.
By:   /s/ Gary W. Willingham
  Gary W. Willingham
  Executive Vice President

 

STATE OF TEXAS    )   
   )    ss.
COUNTY OF HARRIS    )   

The foregoing instrument was acknowledged before me this 29th day of August 2016, by Gary W. Willingham as Executive Vice President of Noble Energy, Inc., a Delaware corporation.

WITNESS my hand and official seal.

My commission expires: 05/05/2018

 

/s/ Joanne Garner
Notary Public

 

Amendment 01 – Signature Page 1

Second Amended and Restated Crude Oil Gathering Agreement

Colorado River Crude Oil Gathering Agreement (NoCo)

CRNC02-OG


“Midstream Co”
COLORADO RIVER DEVCO LP
   By: Colorado River DevCo GP LLC
      By: Noble Midstream Services, LLC
         By:   /s/ Terry R. Gerhart
           Terry R. Gerhart
           Chief Executive Officer

 

STATE OF TEXAS    )   
   )    ss.
COUNTY OF HARRIS    )   

The foregoing instrument was acknowledged before me this 25th day of August 2016, by Terry R. Gerhart as Chief Executive Officer of Noble Midstream Services, LLC, which is the sole member Colorado River DevCo GP LLC, which is the general partner of Colorado River DevCo LP, a Delaware limited partnership.

WITNESS my hand and official seal.

My commission expires: 05/05/2018

 

/s/ Joanne Garner
Notary Public

 

Amendment 01 – Signature Page 2

Second Amended and Restated Crude Oil Gathering Agreement

Colorado River Crude Oil Gathering Agreement (NoCo)

CRNC02-OG

Exhibit 10.26.2

When Recorded, Mail To:

Attn: DJ Land Manager

1625 Broadway, Suite 2200

Denver, CO 80202

AMENDMENT 01

TO

THAT CERTAIN

SECOND AMENDED AND RESTATED

CRUDE OIL GATHERING AGREEMENT

M USTANG

C ONTRACT N UMBER : GRMU03-OG

This AMENDMENT 01 (this “ Amendment ”) shall be effective as among Noble Energy, Inc., a Delaware corporation (the “ Producer ”) and Green River DevCo LP, a Delaware limited partnership, together with its permitted successors and assigns (“ Midstream Co ”) as of September 1, 2016 (the “ Amendment Effective Time ”). This Amendment modifies that certain Second Amended and Restated Crude Oil Gathering Agreement, effective as of March 31, 2016 (the “ Agreement ”), which has been given contract number GRMU03-OG and is comprised of (i) that certain Second Amended and Restated Agreement Terms and Conditions Relating to Crude Oil Gathering Services (the “ Agreement Terms and Conditions ”), last updated March 31, 2016, together with (ii) that certain Second Amended and Restated Agreement Addendum 03 (the “ Agreement Addendum ”), effective as of March 31, 2016. The Agreement Terms and Conditions, the Agreement Addendum and this Amendment shall constitute one contract and shall be the Agreement of the Parties.

WHEREAS, the Parties acknowledge that the purpose of this Amendment is make certain technical modifications.

WHEREAS, the Parties agree and acknowledge that amendments to the Agreement Terms and Conditions set forth herein constitute an amendment only to the Agreement and not to any other agreement in respect of crude oil gathering services to which Producer is a party.


NOW, THEREFORE, in consideration of the foregoing recitals, which are incorporated herein and the mutual agreements in the Agreement, Midstream Co and Producer hereby agree as follows:

1. Amendments .

1.1 Section 1.1 of the Agreement (which appears in the Agreement Terms and Conditions) is hereby amended by amending and restating the following defined terms in their entirety to read as follows:

Facility Segment ” means each segment of an Individual System comprised of facilities beginning at a Receipt Point and ending at a Delivery Point. If an Individual System does not contain any such distinct segment, then the term Facility Segment shall be synonymous with Individual System.

Individual System ” means the portion of the System beginning at the Receipt Points and ending at the Delivery Points. The Individual Systems in existence on the Effective Date are more particularly described in writing between Producer and Midstream Co. Additional Individual Systems may be added to the System from time to time in satisfaction of the needs identified by Producer and evidenced in writing between Producer and Midstream Co.

Other System Fuel ” means any (a) Gas delivered by Producer to Midstream Co pursuant to a Transaction Document between Producer and Midstream Co related to gas gathering services, or (b) Flash Gas, in each case, measured and used as fuel by Midstream Co.

1.2 Section 1.1 of the Agreement (which appears in the Agreement Terms and Conditions) is further amended by amending and restating clauses (a) and (b) of the defined term “Dedicated Production” to read as follows: “(a) Product owned by Producer or an Affiliate of Producer and produced from a Well within the Dedication Area that is operated by Producer or an Affiliate under the Control of Producer, (b) Reserved,”.

1.3 Section 2.3(d) of the Agreement (which appears in the Agreement Terms and Conditions) is hereby amended and restated in its entirety to read: “(d) to pool, communitize or unitize Producer’s interests with respect to Dedicated Production”.

1.4 Section 2.4(b)(iv) of the Agreement (which appears in the Agreement Terms and Conditions) is amended and restated in its entirety to read: “(iv) Reserved.”.

1.5 Section 3.1(e) of the Agreement (which appears in the Agreement Terms and Conditions) is hereby amended by deleting the sentence that reads as follows “In the sole discretion of each Person serving as a Midstream Co under a Midstream Agreement Addendum, such Midstream Co may work with any other Midstream Co to prepare and deliver a System Plan jointly.” and inserting in place thereof the following sentence: “Midstream Co may, in its sole discretion, work with OpCo or any of OpCo’s subsidiaries to prepare and deliver a System Plan jointly with such other entity or entities.”

 

Amendment 01 – Page 2

Second Amended and Restated Crude Oil Gathering Agreement

Green River Crude Oil Gathering Agreement

GRMU03-OG


1.6 Section 3.2 of the Agreement (which appears in the Agreement Terms and Conditions) is hereby amended by inserting the following new clause (e) immediately following clause (d) of such Section 3.2:

“(e) Substation and Interconnection Facilities. The obligations of Midstream Co hereunder to design and construct the Individual System and to perform the Services do not include the design or construction of any substation or other interconnecting facilities required to procure electricity for the Individual System. If a substation or any other interconnecting facility is required in order for Midstream Co to perform its obligations hereunder, Midstream Co and Producer shall enter into a separate agreement setting forth each Party’s responsibilities in connection therewith, including an allocation of responsibility for all associated costs and expenses.”

1.7 Section 6.3(d) of the Agreement (which appears in the Agreement Terms and Conditions) is hereby amended and restated in its entirety to read as follows:

(d) Other System Fuel . Midstream Co may elect to use Other System Fuel as fuel to operate the Individual System, or to generate electricity for the operation of the Individual System and shall account for any Other System Fuel used by Midstream Co. Producer, at its sole cost and expense, shall procure all fuel, in addition to Other System Fuel used by Midstream Co, if any, required to operate the Individual System or to generate electricity for the operation of the Individual System and arrange for transportation of such fuel to the Individual System.

2. Confidentiality . Pursuant to Section 17.11 of the Agreement (which appears in the Agreement Terms and Conditions), the Parties have agreed to treat the information exchanged in connection with and the provisions of the Agreement as confidential. In addition, confidential treatment has been requested with the Securities and Exchange Commission for the pricing terms of the Agreement, and the Parties agree to take appropriate measures to abide by the requirements imposed by the Securities and Exchange Commission to preserve such confidential treatment, if granted.

3. Confirmation . The provisions of the Agreement, as amended by this Amendment, shall remain in full force and effect following the effectiveness of this Amendment. No provision of the Agreement is amended or otherwise modified hereby, except as expressly stated herein.

4. No Waiver . The execution, delivery and effectiveness of this Amendment shall not operate as a waiver of any right, power or remedy of any Party to the Agreement, nor constitute a waiver of any provision of the Agreement. On and after the Amendment Effective Time, this Amendment shall for all purposes constitute a part of the Agreement.

5. Counterparts . This Amendment may be executed in any number of counterparts, and each such counterpart hereof shall be deemed to be an original instrument, but all of such counterparts shall constitute for all purposes one agreement. Any signature hereto delivered by a Party by electronic mail shall be deemed an original signature hereto.

 

Amendment 01 – Page 3

Second Amended and Restated Crude Oil Gathering Agreement

Green River Crude Oil Gathering Agreement

GRMU03-OG


6. Governing Law . This Amendment shall be governed by and construed in accordance with the laws of the State, excluding any conflicts of law rule or principle that might refer construction of such provisions to the laws of another jurisdiction.

(Signature Pages follow)

 

Amendment 01 – Page 4

Second Amended and Restated Crude Oil Gathering Agreement

Green River Crude Oil Gathering Agreement

GRMU03-OG


IN WITNESS WHEREOF, the Parties hereto have executed this Amendment to the Agreement in duplicate originals to be effective as of the Amendment Effective Time.

 

“Producer”
NOBLE ENERGY, INC.
By:   /s/ Gary W. Willingham
  Gary W. Willingham
  Executive Vice President

 

STATE OF TEXAS    )   
   )    ss.
COUNTY OF HARRIS    )   

The foregoing instrument was acknowledged before me this 29th day of August 2016, by Gary W. Willingham as Executive Vice President of Noble Energy, Inc., a Delaware corporation.

WITNESS my hand and official seal.

My commission expires: 05/05/2018

 

/s/ Joanne Garner
Notary Public

 

Amendment 01 – Signature Page 1

Second Amended and Restated Crude Oil Gathering Agreement

Green River Crude Oil Gathering Agreement

GRMU03-OG


“Midstream Co”
GREEN RIVER DEVCO LP
   By: Green River DevCo GP LLC
      By: Noble Midstream Services, LLC
         By:   /s/ Terry R. Gerhart
           Terry R. Gerhart
           Chief Executive Officer

 

STATE OF TEXAS    )   
   )    ss.
COUNTY OF HARRIS    )   

The foregoing instrument was acknowledged before me this 25th day of August 2016, by Terry R. Gerhart as Chief Executive Officer of Noble Midstream Services, LLC, which is the sole member of Green River DevCo GP LLC, which is the general partner of Green River DevCo LP, a Delaware limited partnership.

WITNESS my hand and official seal.

My commission expires: 05/05/2018

 

/s/ Joanne Garner
Notary Public

 

Amendment 01 – Signature Page 2

Second Amended and Restated Crude Oil Gathering Agreement

Green River Crude Oil Gathering Agreement

GRMU03-OG

Exhibit 10.27.2

When Recorded, Mail To:

Attn: DJ Land Manager

1625 Broadway, Suite

2200 Denver, CO 80202

AMENDMENT 01

TO

THAT CERTAIN

SECOND AMENDED AND RESTATED

CRUDE OIL GATHERING AGREEMENT

B RONCO

C ONTRACT N UMBER : GUBR04-OG

This AMENDMENT 01 (this “ Amendment ”) shall be effective as among Noble Energy, Inc., a Delaware corporation (the “ Producer ”) and Gunnison River DevCo LP, a Delaware limited partnership, together with its permitted successors and assigns (“ Midstream Co ”) as of September 1, 2016 (the “ Amendment Effective Time ”). This Amendment modifies that certain Second Amended and Restated Crude Oil Gathering Agreement, effective as of March 31, 2016 (the “ Agreement ”), which has been given contract number GUBR04-OG and is comprised of (i) that certain Second Amended and Restated Agreement Terms and Conditions Relating to Crude Oil Gathering Services (the “ Agreement Terms and Conditions ”), last updated March 31, 2016, together with (ii) that certain Second Amended and Restated Agreement Addendum 04 (the “ Agreement Addendum ”), effective as of March 31, 2016. The Agreement Terms and Conditions, the Agreement Addendum and this Amendment shall constitute one contract and shall be the Agreement of the Parties.

WHEREAS, capitalized terms used herein have the meanings assigned to such terms in the Agreement Terms and Conditions.

WHEREAS, Section 16.1 of the Agreement (which appears in the Agreement Terms and Conditions) prohibits either Party to the Agreement from assigning its rights and obligations, except that Producer may assign its rights and obligations to any Person (herein, the “ Transferee ”) to whom Producer transfers Dedicated Properties so long as such Transferee assumes the rights and obligations of Producer with respect to such transferred Dedicated Properties.

WHEREAS, pursuant to that certain Purchase and Sale Agreement, by and among Producer, NBL Energy Royalties, Inc. and Noble Energy WyCo, LLC, collectively as the Seller, and Synergy Resources Corporation, as Purchaser (the “ Transferee ”), executed May 2, 2016 with


an effective time of April 1, 2016 at 12:01 AM, Producer agreed to sell approximately 30,000 acres of the Dedicated Properties to the Transferee.

WHEREAS, in addition, the Parties acknowledge that a purpose of this Amendment is to make certain technical modifications.

WHEREAS, the Parties agree and acknowledge that amendments to the Agreement Terms and Conditions set forth herein constitute an amendment only to the Agreement and not to any other agreement in respect of crude oil gathering services to which Producer is a party.

NOW, THEREFORE, in consideration of the foregoing recitals, which are incorporated herein and the mutual agreements in the Agreement, Midstream Co and Producer hereby agree as follows:

1. Amendments .

1.1 Section 1.1 of the Agreement (which appears in the Agreement Terms and Conditions) is hereby amended by amending and restating the following defined terms in their entirety to read as follows:

Facility Segment ” means each segment of an Individual System comprised of facilities beginning at a Receipt Point and ending at a Delivery Point. If an Individual System does not contain any such distinct segment, then the term Facility Segment shall be synonymous with Individual System.

Individual System ” means the portion of the System beginning at the Receipt Points and ending at the Delivery Points. The Individual Systems in existence on the Effective Date are more particularly described in writing between Producer and Midstream Co. Additional Individual Systems may be added to the System from time to time in satisfaction of the needs identified by Producer and evidenced in writing between Producer and Midstream Co.

Other System Fuel ” means any (a) Gas delivered by Producer to Midstream Co pursuant to a Transaction Document between Producer and Midstream Co related to gas gathering services, or (b) Flash Gas, in each case, measured and used as fuel by Midstream Co.

1.2 Section 1.1 of the Agreement (which appears in the Agreement Terms and Conditions) is further amended by amending and restating clauses (a) and (b) of the defined term “Dedicated Production” to read as follows: “(a) Product owned by Producer or an Affiliate of Producer and produced from a Well within the Dedication Area that is operated by Producer or an Affiliate under the Control of Producer, (b) Reserved,”.

 

Amendment 01 – Page 2

Second Amended and Restated Crude Oil Gathering Agreement

Gunnison River Crude Oil Gathering Agreement

GUBR04-OG


1.3 Section 2.3(d) of the Agreement (which appears in the Agreement Terms and Conditions) is hereby amended and restated in its entirety to read: “(d) to pool, communitize or unitize Producer’s interests with respect to Dedicated Production”.

1.4 Section 2.4(b)(iv) of the Agreement (which appears in the Agreement Terms and Conditions) is amended and restated in its entirety to read: “(iv) Reserved.”.

1.5 Section 3.1(e) of the Agreement (which appears in the Agreement Terms and Conditions) is hereby amended by deleting the sentence that reads as follows “In the sole discretion of each Person serving as a Midstream Co under a Midstream Agreement Addendum, such Midstream Co may work with any other Midstream Co to prepare and deliver a System Plan jointly.” and inserting in place thereof the following sentence: “Midstream Co may, in its sole discretion, work with OpCo or any of OpCo’s subsidiaries to prepare and deliver a System Plan jointly with such other entity or entities.”

1.6 Section 3.2 of the Agreement (which appears in the Agreement Terms and Conditions) is hereby amended by inserting the following new clause (e) immediately following clause (d) of such Section 3.2:

“(e) Substation and Interconnection Facilities. The obligations of Midstream Co hereunder to design and construct the Individual System and to perform the Services do not include the design or construction of any substation or other interconnecting facilities required to procure electricity for the Individual System. If a substation or any other interconnecting facility is required in order for Midstream Co to perform its obligations hereunder, Midstream Co and Producer shall enter into a separate agreement setting forth each Party’s responsibilities in connection therewith, including an allocation of responsibility for all associated costs and expenses.”

1.7 Section 6.3(d) of the Agreement (which appears in the Agreement Terms and Conditions) is hereby amended and restated in its entirety to read as follows:

(d) Other System Fuel . Midstream Co may elect to use Other System Fuel as fuel to operate the Individual System, or to generate electricity for the operation of the Individual System and shall account for any Other System Fuel used by Midstream Co. Producer, at its sole cost and expense, shall procure all fuel, in addition to Other System Fuel used by Midstream Co, if any, required to operate the Individual System or to generate electricity for the operation of the Individual System and arrange for transportation of such fuel to the Individual System.

 

Amendment 01 – Page 3

Second Amended and Restated Crude Oil Gathering Agreement

Gunnison River Crude Oil Gathering Agreement

GUBR04-OG


1.8 The description of the “Dedication Area” appearing in Agreement Addendum is hereby amended and restated in its entirety to read as follows:

 

            Dedication Area                

The following areas within Weld County, Colorado

 

           Township                    Range            Sections
   5N    65W    13, S/2 21, S/2 22, 23-27, 33-36
   5N    64W    7-9, 16-21, 28-33
   4N    67W    25, 36
   4N    66W    1-3, 8-36
   4N    65W    ALL
   4N    64W    4-9, 16-21, 28-31
  

 

Except and excluding the wells, leases, and other acreage described in the property exhibits
attached to the Releases of Dedication.

2. Confidentiality . Pursuant to Section 17.11 of the Agreement (which appears in the Agreement Terms and Conditions), the Parties have agreed to treat the information exchanged in connection with and the provisions of the Agreement as confidential. In addition, confidential treatment has been requested with the Securities and Exchange Commission for the pricing terms of the Agreement, and the Parties agree to take appropriate measures to abide by the requirements imposed by the Securities and Exchange Commission to preserve such confidential treatment, if granted.

3. Confirmation . The provisions of the Agreement, as amended by this Amendment, shall remain in full force and effect following the effectiveness of this Amendment. No provision of the Agreement is amended or otherwise modified hereby, except as expressly stated herein.

4. No Waiver . The execution, delivery and effectiveness of this Amendment shall not operate as a waiver of any right, power or remedy of any Party to the Agreement, nor constitute a waiver of any provision of the Agreement. On and after the Amendment Effective Time, this Amendment shall for all purposes constitute a part of the Agreement.

5. Counterparts . This Amendment may be executed in any number of counterparts, and each such counterpart hereof shall be deemed to be an original instrument, but all of such counterparts shall constitute for all purposes one agreement. Any signature hereto delivered by a Party by electronic mail shall be deemed an original signature hereto.

6. Governing Law . This Amendment shall be governed by and construed in accordance with the laws of the State, excluding any conflicts of law rule or principle that might refer construction of such provisions to the laws of another jurisdiction.

(Signature Pages follow)

 

Amendment 01 – Page 4

Second Amended and Restated Crude Oil Gathering Agreement

Gunnison River Crude Oil Gathering Agreement

GUBR04-OG


IN WITNESS WHEREOF, the Parties hereto have executed this Amendment to the Agreement in duplicate originals to be effective as of the Amendment Effective Time.

 

“Producer”

 

NOBLE ENERGY, INC.

By:   /s/ Gary W. Willingham
 

Gary W. Willingham

 

Executive Vice President

 

STATE OF TEXAS

     )     
     )      ss.
COUNTY OF HARRIS      )     

The foregoing instrument was acknowledged before me this 29th day of August 2016, by Gary W. Willingham as Executive Vice President of Noble Energy, Inc., a Delaware corporation.

WITNESS my hand and official seal.

My commission expires: 05/05/2018

 

/s/ Joanne Garner
Notary Public

 

Amendment 01 – Signature Page 1

Second Amended and Restated Crude Oil Gathering Agreement

Gunnison River Crude Oil Gathering Agreement

GUBR04-OG


“Midstream Co”

GUNNISON RIVER DEVCO LP

  By:   Gunnison River DevCo GP LLC
      By:   Noble Midstream Services, LLC
          By:   /s/ Terry R. Gerhart
           

Terry R. Gerhart

           

Chief Executive Officer

 

STATE OF TEXAS

     )     
     )      ss.
COUNTY OF HARRIS      )     

The foregoing instrument was acknowledged before me this 25th day of August 2016, by Terry R. Gerhart as Chief Executive Officer of Noble Midstream Services, LLC, which is the sole member of Gunnison River DevCo GP LLC, which is the general partner of Gunnison River DevCo LP, a Delaware limited partnership.

WITNESS my hand and official seal.

My commission expires: 05/05/2018

 

/s/ Joanne Garner
Notary Public

 

Amendment 01 – Signature Page 2

Second Amended and Restated Crude Oil Gathering Agreement

Gunnison River Crude Oil Gathering Agreement

GUBR04-OG

Exhibit 10.28.1.1

When Recorded, Mail To:

Attn: DJ Land Manager

1625 Broadway, Suite 2200

Denver, CO 80202

AMENDMENT 01

TO

THAT CERTAIN

SECOND AMENDED AND RESTATED

CRUDE OIL GATHERING AGREEMENT

G REELEY C RESCENT

C ONTRACT N UMBER : LAGC05-OG

This AMENDMENT 01 (this “ Amendment ”) shall be effective as among Noble Energy, Inc., a Delaware corporation (the “ Producer ”) and Laramie River DevCo LP, a Delaware limited partnership, together with its permitted successors and assigns (“ Midstream Co ”) as of September 1, 2016 (the “ Amendment Effective Time ”). This Amendment modifies that certain Second Amended and Restated Crude Oil Gathering Agreement, effective as of March 31, 2016 (the “ Agreement ”), which has been given contract number LAGC05-OG and is comprised of (i) that certain Second Amended and Restated Agreement Terms and Conditions Relating to Crude Oil Gathering Services (the “ Agreement Terms and Conditions ”), last updated March 31, 2016, together with (ii) that certain Second Amended and Restated Agreement Addendum 05 (the “ Agreement Addendum ”), effective as of March 31, 2016. The Agreement Terms and Conditions, the Agreement Addendum and this Amendment shall constitute one contract and shall be the Agreement of the Parties.

WHEREAS, capitalized terms used herein have the meanings assigned to such terms in the Agreement Terms and Conditions.

WHEREAS, Section 16.1 of the Agreement (which appears in the Agreement Terms and Conditions) prohibits either Party to the Agreement from assigning its rights and obligations, except that Producer may assign its rights and obligations to any Person (herein, the “ Transferee ”) to whom Producer transfers Dedicated Properties so long as such Transferee assumes the rights and obligations of Producer with respect to such transferred Dedicated Properties.

WHEREAS, pursuant to that certain Purchase and Sale Agreement, by and among Producer, NBL Energy Royalties, Inc. and Noble Energy WyCo, LLC, collectively as the Seller, and Synergy Resources Corporation, as Purchaser (the “ Transferee ”), executed May 2, 2016 with an effective time of April 1, 2016 at 12:01 AM, Producer agreed to sell approximately 30,000 acres of the Dedicated Properties to the Transferee.


WHEREAS, in addition, the Parties acknowledge that a purpose of this Amendment is to make certain technical modifications.

WHEREAS, the Parties agree and acknowledge that amendments to the Agreement Terms and Conditions set forth herein constitute an amendment only to the Agreement and not to any other agreement in respect of crude oil gathering services to which Producer is a party.

NOW, THEREFORE, in consideration of the foregoing recitals, which are incorporated herein and the mutual agreements in the Agreement, Midstream Co and Producer hereby agree as follows:

1. Amendments .

1.1 Section 1.1 of the Agreement (which appears in the Agreement Terms and Conditions) is hereby amended by amending and restating the following defined terms in their entirety to read as follows:

Facility Segment ” means each segment of an Individual System comprised of facilities beginning at a Receipt Point and ending at a Delivery Point. If an Individual System does not contain any such distinct segment, then the term Facility Segment shall be synonymous with Individual System.

Individual System ” means the portion of the System beginning at the Receipt Points and ending at the Delivery Points. The Individual Systems in existence on the Effective Date are more particularly described in writing between Producer and Midstream Co. Additional Individual Systems may be added to the System from time to time in satisfaction of the needs identified by Producer and evidenced in writing between Producer and Midstream Co.

Other System Fuel ” means any (a) Gas delivered by Producer to Midstream Co pursuant to a Transaction Document between Producer and Midstream Co related to gas gathering services, or (b) Flash Gas, in each case, measured and used as fuel by Midstream Co.

1.2 Section 1.1 of the Agreement (which appears in the Agreement Terms and Conditions) is further amended by amending and restating clauses (a) and (b) of the defined term “Dedicated Production” to read as follows: “(a) Product owned by Producer or an Affiliate of Producer and produced from a Well within the Dedication Area that is operated by Producer or an Affiliate under the Control of Producer, (b) Reserved,”.

 

Amendment 01 – Page 2

Second Amended and Restated Crude Oil Gathering Agreement

Laramie River Crude Oil Gathering Agreement

LAGC05-OG


1.3 Section 2.3(d) of the Agreement (which appears in the Agreement Terms and Conditions) is hereby amended and restated in its entirety to read: “(d) to pool, communitize or unitize Producer’s interests with respect to Dedicated Production”.

1.4 Section 2.4(b)(iv) of the Agreement (which appears in the Agreement Terms and Conditions) is amended and restated in its entirety to read: “(iv) Reserved.”.

1.5 Section 3.1(e) of the Agreement (which appears in the Agreement Terms and Conditions) is hereby amended by deleting the sentence that reads as follows “In the sole discretion of each Person serving as a Midstream Co under a Midstream Agreement Addendum, such Midstream Co may work with any other Midstream Co to prepare and deliver a System Plan jointly.” and inserting in place thereof the following sentence: “Midstream Co may, in its sole discretion, work with OpCo or any of OpCo’s subsidiaries to prepare and deliver a System Plan jointly with such other entity or entities.”

1.6 Section 3.2 of the Agreement (which appears in the Agreement Terms and Conditions) is hereby amended by inserting the following new clause (e) immediately following clause (d) of such Section 3.2:

“(e) Substation and Interconnection Facilities. The obligations of Midstream Co hereunder to design and construct the Individual System and to perform the Services do not include the design or construction of any substation or other interconnecting facilities required to procure electricity for the Individual System. If a substation or any other interconnecting facility is required in order for Midstream Co to perform its obligations hereunder, Midstream Co and Producer shall enter into a separate agreement setting forth each Party’s responsibilities in connection therewith, including an allocation of responsibility for all associated costs and expenses.”

1.7 Section 6.3(d) of the Agreement (which appears in the Agreement Terms and Conditions) is hereby amended and restated in its entirety to read as follows:

(d) Other System Fuel . Midstream Co may elect to use Other System Fuel as fuel to operate the Individual System, or to generate electricity for the operation of the Individual System and shall account for any Other System Fuel used by Midstream Co. Producer, at its sole cost and expense, shall procure all fuel, in addition to Other System Fuel used by Midstream Co, if any, required to operate the Individual System or to generate electricity for the operation of the Individual System and arrange for transportation of such fuel to the Individual System.

 

Amendment 01 – Page 3

Second Amended and Restated Crude Oil Gathering Agreement

Laramie River Crude Oil Gathering Agreement

LAGC05-OG


1.8 The description of the “Dedication Area” appearing in Agreement Addendum is hereby amended and restated in its entirety to read as follows:

 

Dedication Area  

The following areas within Weld County, Colorado

 

   
      Township    Range    Sections    
      T7N    R65W    ALL    
      T6N    R65W    1-5, 9-17, 20-29, 33-36    
      T5N    R67W    13, 14, 23-26, 35, 36    
      T5N    R66W    18-20, 25, S/2 26, 27-36    
      T5N    R65W    1-3, E/2 4, 14    
      T4N    R67W    1,2, 26, 27, 34, 35    
   
   

Except and excluding the wells, leases, and other acreage described in the property exhibits attached to the Releases of Dedication.

 

2. Confidentiality . Pursuant to Section 17.11 of the Agreement (which appears in the Agreement Terms and Conditions), the Parties have agreed to treat the information exchanged in connection with and the provisions of the Agreement as confidential. In addition, confidential treatment has been requested with the Securities and Exchange Commission for the pricing terms of the Agreement, and the Parties agree to take appropriate measures to abide by the requirements imposed by the Securities and Exchange Commission to preserve such confidential treatment, if granted.

3. Confirmation . The provisions of the Agreement, as amended by this Amendment, shall remain in full force and effect following the effectiveness of this Amendment. No provision of the Agreement is amended or otherwise modified hereby, except as expressly stated herein.

4. No Waiver . The execution, delivery and effectiveness of this Amendment shall not operate as a waiver of any right, power or remedy of any Party to the Agreement, nor constitute a waiver of any provision of the Agreement. On and after the Amendment Effective Time, this Amendment shall for all purposes constitute a part of the Agreement.

5. Counterparts . This Amendment may be executed in any number of counterparts, and each such counterpart hereof shall be deemed to be an original instrument, but all of such counterparts shall constitute for all purposes one agreement. Any signature hereto delivered by a Party by electronic mail shall be deemed an original signature hereto.

6. Governing Law . This Amendment shall be governed by and construed in accordance with the laws of the State, excluding any conflicts of law rule or principle that might refer construction of such provisions to the laws of another jurisdiction.

(Signature Pages follow)

 

Amendment 01 – Page 4

Second Amended and Restated Crude Oil Gathering Agreement

Laramie River Crude Oil Gathering Agreement

LAGC05-OG


IN WITNESS WHEREOF, the Parties hereto have executed this Amendment to the Agreement in duplicate originals to be effective as of the Amendment Effective Time.

“Producer”

 

NOBLE ENERGY, INC.
By:   /s/ Gary W. Willingham
  Gary W. Willingham
  Executive Vice President

STATE OF TEXAS                      )

                                                          ) ss.

COUNTY OF HARRIS                     )

The foregoing instrument was acknowledged before me this 29th day of August 2016, by Gary W. Willingham as Executive Vice President of Noble Energy, Inc., a Delaware corporation.

WITNESS my hand and official seal.

My commission expires: 05/05/2018

 

/s/ Joanne Garner
Notary Public

 

Amendment 01 – Signature Page 1

Second Amended and Restated Crude Oil Gathering Agreement

Laramie River Crude Oil Gathering Agreement

LAGC05-OG


“Midstream Co”

LARAMIE RIVER DEVCO LP

  By:   Laramie River DevCo GP LLC
      By:   Noble Midstream Services, LLC
          By:   /s/ Terry R. Gerhart
           

Terry R. Gerhart

           

Chief Executive Officer

STATE OF TEXAS                      )

                                                          ) ss.

COUNTY OF HARRIS                     )

The foregoing instrument was acknowledged before me this 25th day of August 2016, by Terry R. Gerhart as Chief Executive Officer of Noble Midstream Services, LLC, which is the sole member of Laramie River DevCo GP LLC, which is the general partner of Laramie River DevCo LP, a Delaware limited partnership.

WITNESS my hand and official seal.

My commission expires: 05/05/2018

 

/s/ Joanne Garner
Notary Public

 

Amendment 01 – Signature Page 2

Second Amended and Restated Crude Oil Gathering Agreement

Laramie River Crude Oil Gathering Agreement

LAGC05-OG

Exhibit 10.35

TEXAS CRUDE OIL GATHERING AGREEMENT

consisting of the

TEXAS AGREEMENT TERMS AND CONDITIONS RELATING TO

CRUDE OIL GATHERING SERVICES

taken together with the applicable

TEXAS AGREEMENT ADDENDUM

now or in the future effective


TABLE OF CONTENTS

 

ARTICLE 1 DEFINITIONS

     1   

Section 1.1

  

Definitions

     1   

Section 1.2

  

Other Terms

     13   

Section 1.3

  

References and Rules of Construction

     13   

ARTICLE 2 PRODUCT DEDICATION AND REAL PROPERTY DEDICATION

     14   

Section 2.1

  

Producer’s Dedications

     14   

Section 2.2

  

Conflicting Dedications

     14   

Section 2.3

  

Producer’s Reservation

     15   

Section 2.4

  

Releases from Dedication

     15   

Section 2.5

  

Covenants Running with the Land

     17   

Section 2.6

  

Recording of Agreement

     18   

ARTICLE 3 SYSTEM EXPANSION AND CONNECTION OF WELLS

     18   

Section 3.1

  

Development Report; System Plan; Meetings

     18   

Section 3.2

  

Expansion of System and Connection of Separator Facilities

     22   

Section 3.3

  

Temporary Services

     23   

Section 3.4

  

Cooperation

     24   

Section 3.5

  

Grant of Access; Real Property Rights

     24   

ARTICLE 4 MEASUREMENT DEVICES

     25   

Section 4.1

  

Measurement Devices

     25   

Section 4.2

  

Measurement Procedures

     27   

Section 4.3

  

Product Meter Adjustments

     28   

ARTICLE 5 TENDER, NOMINATION, AND GATHERING OF PRODUCTION

     28   

Section 5.1

  

Limitations on Service to Third Parties

     28   

Section 5.2

  

Tender of Dedicated Production

     29   

Section 5.3

  

Services; Service Standard

     29   

Section 5.4

  

Nominations, Scheduling, and Curtailment

     29   

Section 5.5

  

Suspension/Shutdown of Service

     31   

Section 5.6

  

Marketing and Transportation

     32   

Section 5.7

  

No Prior Flow of Product in Interstate Commerce

     32   

ARTICLE 6 FEES

     32   

Section 6.1

  

Fees

     32   

Section 6.2

  

Fee Adjustments

     32   

Section 6.3

  

Treatment of Byproducts, System Gains/Losses, Fuel and Related Matters

     33   

 

Texas Crude Oil Gathering Agreement

i


ARTICLE 7 QUALITY

     35   

Section 7.1

  

Quality Specifications

     35   

Section 7.2

  

Failure to Meet Specifications

     36   

Section 7.3

  

Indemnification Regarding Quality

     37   

ARTICLE 8 TERM

     37   

Section 8.1

  

Term

     37   

Section 8.2

  

Effect of Termination or Expiration of the Term

     37   

ARTICLE 9 TITLE AND CUSTODY

     37   

Section 9.1

  

Title

     37   

Section 9.2

  

Custody

     37   

ARTICLE 10 BILLING AND PAYMENT

     38   

Section 10.1

  

Statements

     38   

Section 10.2

  

Payments

     38   

Section 10.3

  

Adequate Assurances

     39   

Section 10.4

  

Audit

     39   

ARTICLE 11 REMEDIES

     40   

Section 11.1

  

Suspension of Performance; Temporary Release from Dedication

     40   

Section 11.2

  

No Election

     41   

Section 11.3

  

DIRECT DAMAGES

     41   

ARTICLE 12 FORCE MAJEURE

     41   

Section 12.1

  

Force Majeure

     41   

Section 12.2

  

Extension Due to Force Majeure

     42   

ARTICLE 13 CHANGE IN LAW; UNECONOMIC SERVICE

     42   

Section 13.1

  

Changes in Applicable Law

     42   

Section 13.2

  

Unprofitable Operations and Rights of Termination

     42   

ARTICLE 14 REGULATORY STATUS

     44   

Section 14.1

  

Non-Jurisdictional System

     44   

Section 14.2

  

Government Authority Modification

     45   

ARTICLE 15 INDEMNIFICATION AND INSURANCE

     45   

Section 15.1

  

Reciprocal Indemnity

     45   

Section 15.2

  

Indemnification Regarding Third Parties

     46   

Section 15.3

  

Penalties

     46   

Section 15.4

  

Insurance

     46   

 

Texas Crude Oil Gathering Agreement

ii


ARTICLE 16 ASSIGNMENT

     46   

Section 16.1

  

Assignment of Rights and Obligations under this Agreement

     46   

Section 16.2

  

Pre-Approved Assignments

     47   

Section 16.3

  

Change of Control

     48   

ARTICLE 17 OTHER PROVISIONS

     48   

Section 17.1

  

Relationship of the Parties

     48   

Section 17.2

  

Notices

     48   

Section 17.3

  

Entire Agreement; Conflicts

     49   

Section 17.4

  

Waivers; Rights Cumulative

     49   

Section 17.5

  

Amendment

     49   

Section 17.6

  

Governing Law; Arbitration

     49   

Section 17.7

  

Parties in Interest

     50   

Section 17.8

  

Preparation of Agreement

     50   

Section 17.9

  

Severability

     50   

Section 17.10

  

Counterparts

     50   

Section 17.11

  

Confidentiality

     50   

EXHIBITS

 

EXHIBIT A    RESERVED
EXHIBIT B    DOWNTIME FEE REDUCTION
EXHIBIT C    OPERATING PRESSURE FEE REDUCTION
EXHIBIT D    INSURANCE

 

 

Texas Crude Oil Gathering Agreement

iii


TEXAS AGREEMENT TERMS AND CONDITIONS RELATING TO

CRUDE OIL GATHERING SERVICES

These TEXAS AGREEMENT TERMS AND CONDITIONS RELATING TO CRUDE OIL GATHERING SERVICES (these “ Agreement Terms and Conditions ”) (i) shall be effective with respect to each signatory of each Agreement Addendum as of the Effective Date specified in the applicable Agreement Addendum (defined below), (ii) were last updated as of the Effective Date, (iii) are incorporated into and made a part of each Agreement Addendum, and (iv) taken together with the applicable Agreement Addendum shall constitute one Agreement, separate and apart from any other Agreement governed by these Agreement Terms and Conditions.

Recitals:

A. Producer owns rights, title and interests in certain oil and gas leases and other interests located within the Dedication Area (defined below) that require services related to the gathering of hydrocarbons.

B. Producer wishes to obtain such gathering services from each Midstream Co (defined below) that executes and delivers an Agreement Addendum (defined below) pursuant to these Agreement Terms and Conditions, as modified by the applicable Agreement Addendum.

C. Producer desires to dedicate all crude oil it Controls (defined below) that is attributable to its right, title, and interest in certain oil and gas leases and other interests located within the Dedication Area (defined below) to the Individual System (defined below).

D. Each Midstream Co that executes and delivers an Agreement Addendum owns and operates an Individual System that gathers gas from certain oil and gas leases and other interests.

Agreements:

NOW, THEREFORE, in consideration of the foregoing Recitals, which are incorporated herein, the mutual agreements in this Agreement, and other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, Midstream Co and Producer hereby agree as follows:

Article 1

Definitions

Section 1.1 Definitions . As used in this Agreement, the following capitalized terms shall have the meanings ascribed to them below:

Abandonment Date ” has the meaning given to it in Section 3.2(d) .

Additional/Accelerated Well ” has the meaning given to it in Section 3.2(c) .

 

Texas Crude Oil Gathering Agreement

- 1 -


Adequate Assurance of Performance ” has the meaning given to it in Section 10.3 .

Adjustment Year ” has the meaning given to it in Section 6.2(a)(ii) .

Affiliate ” means, with respect to any Person, any other Person that directly, or indirectly through one or more intermediaries, Controls, or is Controlled by, or is under common Control with, such Person. The following sentence shall not apply to the term “Affiliate” as used in Section 2.2(b) or the definition of “Conflicting Dedication”: Producer and its subsidiaries (other than OpCo and its subsidiaries), on the one hand, and OpCo and its subsidiaries, on the other, shall not be considered Affiliates of each other for purposes of this Agreement.

Agreement ” means the applicable Agreement Addendum taken together with these Agreement Terms and Conditions, as modified by such Agreement Addendum.

Agreement Addendum ” means each Agreement Addendum by and between a Producer and a Midstream Co that expressly states that it is governed by these Agreement Terms and Conditions. “ Agreement Addenda ” shall be the collective reference to each Agreement Addendum then in effect.

Agreement Terms and Conditions ” has the meaning given to it in the introductory paragraph.

Applicable Month ” has the meaning set forth in Section 6.2(c) .

Associated Water ” means water that is produced with Producer’s owned or Controlled Product and delivered with such Product to the System at the Receipt Point, which Midstream Co will separate (if and to the degree required) from such Product prior to the redelivery of such Product to Producer at the Delivery Point; provided that from and after the point that such water has been separated from such Product (such term, in this context, used excluding Associated Water) and delivered into the Water System, such water shall cease to be Associated Water hereunder and shall be deemed to be Produced Water.

Barrel ” means a quantity consisting of forty-two Gallons.

Beneficiary ” has the meaning given to it in Section 4.1(g).

BS&W ” means basic sediment and water (which for the avoidance of doubt, includes both Associated Water and Produced Water).

Business Day ” means a Day (other than a Saturday or Sunday) on which federal reserve banks are open for business.

Cancellation Date ” has the meaning given to it in Section 3.1(c) .

Claiming Party ” has the meaning given to it in the definition of “Force Majeure”.

Communications ” has the meaning given to it in Section 17.2 .

 

Texas Crude Oil Gathering Agreement

- 2 -


Conditional Amount ” has the meaning set forth in Section 10.1(a) .

Conflicting Dedication ” means any gathering agreement, commitment, or arrangement (including any volume commitment) that requires Producer’s owned or Controlled Product to be trucked from or sold to a Third Party at the lease or to be gathered on any gathering system or similar system other than the System, including any such agreement, commitment, or arrangement burdening properties hereinafter acquired by Producer in the Dedication Area. No dedication of acreage shall constitute a Conflicting Dedication if Producer’s requirement under such dedication is to deliver Product from the tailgate of the System or any other point that is a Delivery Point hereunder. A right of first refusal in favor of an entity other than Original Producer, OpCo, or any of their Affiliates shall be deemed to be a “Conflicting Dedication” if Affiliates of Original Producer are prohibited from providing Services pursuant to the applicable agreement creating such right of first refusal.

Control ” (including the term “ Controlled ”) means (a) with respect to any Person, the possession, direct or indirect, of the power to direct or cause the direction of the management and policies of a Person, whether through the ownership of voting shares, by contract, or otherwise and (b) with respect to any Product, such Product produced from the Dedication Area and owned by a Third Party or an Affiliate and with respect to which Producer has the contractual right or obligation (pursuant to a marketing, agency, operating, unit, or similar agreement) to market such Product and Producer elects or is obligated to market such Product on behalf of the applicable Third Party or Affiliate.

Credit-Worthy Person ” means a Person with a senior unsecured and credit-unenhanced long term debt rating equivalent to A- or better as determined by at least two rating agencies, one of which must be either Standard & Poor’s or Moody’s (or if either one or both are not available, equivalent ratings from alternate rating sources reasonably acceptable to Midstream Co).

Day ” means a period of time from 7:00 a.m. Central Time on a calendar day until 7:00 a.m. Central Time on the succeeding calendar day. The term “ Daily ” shall have the correlative meaning.

Dedicated Production ” means (a) Product owned by Producer or an Affiliate of Producer and produced from a Well within the Dedication Area that is operated by Producer or an Affiliate under the Control of Producer, (b) Reserved, (c) Product produced within the Dedication Area that is owned by a Third Party and under the Control of Producer, and (d) Purchased Dedicated Production. Notwithstanding the foregoing, (i) any Product that was released pursuant to the Releases of Dedication shall not be included in this definition of “Dedicated Production,” (ii) any Product that is permanently released pursuant to Section 2.4(a) or otherwise shall cease to be included in this definition of “Dedicated Production” immediately upon the effectiveness of such permanent release, and (iii) in the event of an assignment by a Producer (“X”) to an assignee (“Y”) that is permitted under Article 16 , any Product that is so assigned shall cease to be included in X’s Dedicated Production and shall solely be included in Y’s Dedicated Production as of the effective date of such assignment.

Dedicated Properties ” means the interests held by Producer or its Affiliates in the oil and gas leases, mineral interests, and other similar interests as of the Effective Date or acquired by

 

Texas Crude Oil Gathering Agreement

- 3 -


Producer or its Affiliates after the Effective Date that relate to land within the Dedication Area. Notwithstanding the foregoing, (a) any interest that was released pursuant to the Releases of Dedication shall not be included in this definition of “Dedicated Properties,” (b) any interest that is permanently released pursuant to Section 2.4(a) or otherwise shall cease to be included in this definition of “Dedicated Properties” immediately upon the effectiveness of such permanent release and (c) in the event of an assignment by a Producer (“X”) to an assignee (“Y”) that is permitted under Article 16 , any interest that is so assigned shall cease to be included in X’s Dedicated Properties and shall solely be included in Y’s Dedicated Properties as of the effective date of such assignment.

Dedications ” means the Product Dedication and the Real Property Dedication together, and “ Dedication ” means the Product Dedication or the Real Property Dedication, as applicable.

Dedication Area ” means, with respect to this Agreement, the area described on the applicable Agreement Addendum. Notwithstanding the foregoing, (a) any acreage that was released pursuant to the Releases of Dedication shall not be included in this definition of “Dedication Area,” (b) any acreage that is permanently released pursuant to Section 2.4(a) or otherwise shall cease to be included in this definition of “Dedication Area” immediately upon the effectiveness of such permanent release and (c) in the event of an assignment by a Producer (“X”) to an assignee (“Y”) that is permitted under Article 16 , any acreage that is so assigned shall cease to be included in X’s Dedication Area and shall solely be included in Y’s Dedication Area as of the effective date of such assignment.

Delivery Point ” means the point at which custody transfers from Midstream Co to or for the account of Producer. The custody transfer point may include (a) the facilities of a Downstream Facility, (b) trucks, (c) the facilities of an oil processing facility or (d) any other point as may be mutually agreed between the Parties. The Delivery Points for each Individual System in existence on the Effective Date shall be set forth in writing between Producer and Midstream Co, and additional points may become Delivery Points hereunder upon mutual agreement of the Parties as construction is completed on additional facilities in satisfaction of the needs identified by Producer and the Parties shall continuously update the list of Delivery Points by mutual agreement.

Development Report ” has the meaning given to it in Section 3.1(a) .

Downstream Facility ” means any pipeline downstream of any Delivery Point on the System.

Downtime Event ” means, with respect to any Facility Segment, or, as applicable, all of the Facilities Segments of an Individual System, a period during which Midstream Co is unable to receive Product into the central facility of such Facility Segment for a reason other than (i) Force Majeure, (ii) an event or condition downstream of the Individual System of which such Facility Segment is a part that was not caused by Midstream Co, (iii) planned maintenance for which Midstream Co provided notice as described in Section 5.5(b)(ii) , or (iv) Producer’s production exceeding the production forecast in the Development Report on which the applicable Facility Segment was based.

 

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Downtime Hours ” means, with respect to any Facility Segment, the hours during the Applicable Month during which such Facility Segment was unavailable to provide Services.

Downtime Percentage ” means, with respect to any Facility Segment during the Applicable Month, an amount equal to the quotient of (a) the aggregate number of Downtime Hours during the Applicable Month, divided by (b) the total hours during the Applicable Month.

Drip Condensate ” means that portion of Gas Controlled by Producer received into the Gas System (without manual separation or injection) that condenses in the Gas System, and is recovered by Midstream Co. If at any time Midstream Co is not providing gathering services to Producer in the Dedication Area with respect to Gas, there will be no Drip Condensate delivered into the Individual System.

Effective Date ” has the meaning given to it in the applicable Agreement Addendum.

Escalation Percentage ” means 2.50%.

Excluded Amounts ” means Midstream Co’s general and administrative costs and any costs for design or construction of facilities that can be used to connect other Planned Wells or Planned Separator Facilities in the Development Report that Producer at such time intends to develop.

Facility Segment ” means each segment of an Individual System comprised of facilities beginning at a Receipt Point and ending at a Delivery Point. If an Individual System does not contain any such distinct segment, then the term Facility Segment shall be synonymous with Individual System.

First Development Report ” means the first report delivered by Original Producer to Midstream Co that satisfies the requirements for a Development Report in Section 3.1(a) and Section 3.1(b) (an “ Original Report ”); and, in the event that Producer assigns all or any part of the Dedicated Properties to a Producer Assignee, then with respect to such Producer Assignee, the First Development Report shall not refer to the Original Report but rather to the first Development Report delivered by such Producer Assignee to Midstream Co that satisfies the requirements for such report in Section 3.1(a) and Section 3.1(b) .

Flash Gas ” means any gas that has been vaporized from Product resulting from the gathering and treating of Product in the Individual System pursuant to this Agreement and has been collected by Midstream Co.

Force Majeure ” means an event that is not within the reasonable control of the Party claiming suspension (the “ Claiming Party ”), and that by the exercise of reasonable due diligence the Claiming Party is unable to avoid or overcome in a reasonable manner. To the extent meeting the foregoing requirements, Force Majeure includes: (a) acts of God; (b) wars (declared or undeclared); (c) insurrections, hostilities, riots; (d) floods, droughts, fires, storms, storm warnings, landslides, lightning, earthquakes, washouts; (e) industrial disturbances, acts of a public enemy, acts of terror, sabotage, blockades, epidemics; (f) arrests and restraints of rulers and peoples; (g) civil disturbances; (h) explosions, breakage or accidents to machinery or lines of pipe; (i) hydrate obstruction or blockages of any kind in lines of pipe; (j) freezing of wells or

 

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delivery facilities, partial or entire failure of wells, and other events beyond the reasonable control of the Claiming Party that affect the timing of production or production levels; (k) ( reserved ); (l) action or restraint by any Governmental Authority (so long as the Claiming Party has not applied for or assisted in the application for, and has opposed where and to the extent commercially reasonable, such action or restraint), (m) delays or failures by a Governmental Authority to grant Permits applicable to the System (or any Individual System) so long as the Claiming Party has used its commercially reasonable efforts to make any required filings with such Governmental Authority relating to such Permits, and (n) delays or failures by the Claiming Party to obtain easements and rights of way, surface leases and other real property interests related to the System (or any Individual System) from Third Parties, so long as the Claiming Party has used its commercially reasonable efforts to obtain such easements and rights of way, surface leases and other real property interests. The failure of a Claiming Party to settle or prevent a strike or other labor dispute with employees shall not be considered to be a matter within such Claiming Party’s control.

Gallon ” means one U.S. Standard gallon measured at 60 degrees Fahrenheit.

Gas ” means any mixture of gaseous hydrocarbons, consisting essentially of methane and heavier hydrocarbons, including Flash Gas and, unless otherwise expressly provided herein, liquefiable hydrocarbons and Drip Condensate, and including inert and noncombustible gases, produced in the Dedication Area.

Gas System ” means the Gas gathering system providing Gas gathering services to Producer.

Governmental Authority ” means any federal, state, local, municipal, tribal or other government; any governmental, regulatory (including self-regulatory) or administrative agency, commission, body or other authority exercising or entitled to exercise any administrative, executive, judicial, legislative, regulatory or taxing authority or power; and any court or governmental tribunal, including any tribal authority having or asserting jurisdiction.

Group ” means (a) with respect to Midstream Co, the Midstream Co Group, and (b) with respect to Producer, the Producer Group.

Increase in Fee ” has the meaning given to it in Section 6.2(b) .

Individual Fee ” means the rate for each Individual System set forth on the applicable Agreement Addendum.

Individual System ” means the portion of the System beginning at the Receipt Points and ending at the Delivery Points. The Individual Systems in existence on the Effective Date are more particularly described in writing between Producer and Midstream Co. Additional Individual Systems may be added to the System from time to time in satisfaction of the needs identified by Producer and evidenced in writing between Producer and Midstream Co.

Initial Term ” has the meaning given to it in Section 8.1 .

 

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Interest Rate ” means, on the applicable date of determination, the prime rate (as published in the “Money Rates” table of The Wall Street Journal , eastern edition, or if such rate is no longer published in such publication or such publication ceases to be published, then as published in a similar national business publication as mutually agreed by the Parties) plus an additional two percentage points (or, if such rate is contrary to any applicable Law, the maximum rate permitted by such applicable Law).

Interruption Conditions ” has the meaning given to it in Section 2.4(b) .

Inventory Account ” has the meaning given to it in Section 5.4(f) .

Invoice Month ” has the meaning given to it in Section 10.1(a) .

Law ” means any applicable statute, law, rule, regulation, ordinance, order, code, ruling, writ, injunction, decree or other official act of or by any Governmental Authority.

Losses ” means any actions, claims, causes of action (including actions in rem or in personam), settlements, judgments, demands, liens, encumbrances, losses, damages, fines, penalties, interest, costs, liabilities, expenses (including expenses attributable to the defense of any actions or claims and attorneys’ fees) of any kind or character, including Losses for bodily injury, death, or property damage, whether under judicial proceedings, administrative proceedings or otherwise, and under any theory of tort, contract, breach of contract, breach of representation or warranty (express or implied) or by reason of the conditions of the premises of or attributable to any Person or Person or any Party or Parties.

Measurement Device ” means the lease automatic custody transfer, coriolis, or other metering device or equipment which, along with application of test results (e.g. shrinkage factors, BS&W factors, meter proves, etc), as required for the Individual System, measure the amount of oil, water, and BS&W, all of which shall conform to industry standards and government regulations, as further described in Article 4 .

Measurement Point ” means the Measurement Device that the Parties have agreed in writing will measure the volume of Product moving through the Individual System.

Meetings of Senior Management ” means meetings between senior members of management of Midstream Co and Producer, or, if applicable, senior members of management of an Affiliate of Midstream Co or Producer, respectively, that Controls such entity.

Midstream Co ” means the Original Midstream Co, together with its permitted successors and assigns, including any Midstream Co Assignee.

Midstream Co Assignee ” means any Third Party to whom Midstream Co assigns its rights and obligations in accordance with this Agreement.

Midstream Co Group ” means Midstream Co, its Affiliates, and the directors, officers, employees, and agents, of Midstream Co and its Affiliates; provided that all subsidiaries of OpCo that do not hold equity in Midstream Co shall be excluded from this definition.

 

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Modifications ” has the meaning given to it in Section 3.1(c) .

Month ” means a period of time from 7:00 a.m. Central Time on the first Day of a calendar month until 7:00 a.m. Central Time on the first Day of the next succeeding calendar month. The term “ Monthly ” shall have the correlative meaning.

Monthly Loss/ Gain Report ” means, with respect to any Invoice Month, the report delivered pursuant to Section 10.1(d) , which shall include statements of the following with respect to such Invoice Month: (a) the System Gains/Losses, (b) the Other System Fuel used by Midstream Co in the operation of the Individual System, (c) the Associated Water returned to Producer, and (d) to the extent required by a writing signed by Producer and Midstream Co, the Drip Condensate, the Recovered Oil and Flash Gas recovered by Midstream Co and returned to Producer. With respect to any allocated volumes (specifically, those described in clauses (c) and, if applicable, (d)), the information included shall be of sufficient detail such that Producer may verify that the allocation procedures then in effect for the applicable Invoice Month were applied.

Moody’s ” means Moody’s Investors Service, Inc., or any successor to its statistical rating business.

Net Acres ” means (a) with respect to any oil and gas lease in which Producer has an interest, (i) the number of gross acres in the lands covered by such oil and gas lease, multiplied by (ii) the undivided percentage interest in oil, gas and other minerals covered by such oil and gas lease, multiplied by (iii) Producer’s working interest in such oil and gas lease, and (b) with respect to any mineral fee interest of Producer, (i) the number of gross acres in the lands covered by such mineral fee interest, multiplied by (ii) the undivided percentage interest of Producer in oil, gas and other minerals in such lands.

Net Standard Volume ” means, with respect to Product, the gross standard volume, excluding BS&W. For purposes of this definition, the following terms have the definitions set forth below:

 

  1. Indicated Volume ” means the change in meter reading which occurs during a receipt or delivery (Indicated Volume = closed meter reading - open meter reading).

 

  2. Gross Volume ” means the Indicated Volume multiplied by the meter factor for the particular liquid and flow rate under which the meter was proved.

 

  3. Gross Standard Volume ” means the Gross Volume, corrected for base gravity, at standard temperature corrected to standard pressure.

Oil Quality ” means the inherent characteristics of Product as determined by measurement or tests including BS&W, API gravity, sulfur content, viscosity, pour point, wax crystallization temperature, metals content, and similar characteristics.

On-Line Deadline ” has the meaning given to it in Section 3.2(b) .

 

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OpCo ” means Noble Midstream Services, LLC, together with its permitted successors and assigns.

Operating Hours ” has the meaning set forth in Section 6.2(c) .

Original Midstream Co ” means the entity identified as the “Midstream Co” in the applicable Agreement Addendum as of the Effective Date.

Original Producer ” means Rosetta Resources Operating LP, a Delaware limited partnership .

Original Report ” has the meaning set forth in the definition of “First Development Report.”

Other System Fuel ” means any (a) Gas delivered by Producer to Midstream Co pursuant to a Transaction Document between Producer and Midstream Co related to gas gathering services, or (b) Flash Gas, in each case, measured and used as fuel by Midstream Co.

Outbound Acreage ” has the meaning given to it in Section 16.2(b)(i) .

Overage Period ” has the meaning given to it in Section 5.4(d)(ii) .

Owner ” has the meaning given to it in Section 4.1(g) .

Party ” or “ Parties ” with respect to each Agreement Addendum shall mean the applicable Producer and the applicable Midstream Co. Unless expressly stated otherwise, references to “Parties” shall not refer to all parties to all Agreements governed hereby. Rather, references to “Parties” shall refer only to such Parties as determined by the applicable Agreement Addendum.

Period of Five Years ” means, with respect to any report delivered hereunder, the period from the first Day of the fiscal quarter during which such report is required to be delivered until the fifth anniversary thereof.

Period of Two Years ” means, with respect to any report delivered hereunder, the period beginning on the first Day of the fiscal quarter during which such report is required to be delivered and ending 24 Months after such date.

Permits ” means any permit, license, approval, or consent from a Governmental Authority.

Person ” means any individual, corporation, company, partnership, limited partnership, limited liability company, trust, estate, Governmental Authority, or any other entity.

Planned Separator Facility ” has the meaning given to it in Section 3.1(b)(i) .

Planned Well ” has the meaning given to it in Section 3.1(b)(i) .

Pressure Overage Percentage ” means an amount equal to the quotient of (a) the difference between (i) the highest actual operating pressure of the applicable Facility Segment, as

 

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measured at the inlet to the applicable central facility, sustained during any Overage Period and (ii) the Target Pressure for such Facility Segment divided by (b) the Target Pressure for such Facility Segment.

Produced Water ” means water that is produced as a byproduct of Producer’s operation of the Wells that are located in the Dedication Area; provided that any water that is Associated Water shall not constitute Produced Water hereunder until such time as it has been separated from Product and ceases being Associated Water. The term “Produced Water” shall refer to all water that is in the Water System, whether such water is in the form of saltwater or water that has completed the recycling and treating processes.

Producer ” means the Original Producer, together with its permitted successors and assigns, including any Producer Assignee.

Producer Assignee ” means any Person to whom Original Producer or any subsequent Producer sells, assigns, or otherwise transfers acreage subject to the Dedications.

Producer Group ” means Producer, its Affiliates, and the directors, officers, employees, and agents of Producer and its Affiliates.

Producer Line Fill ” has the meaning given to it in Section 5.4(f)(i) .

Producer Meters ” means any Measurement Device owned and operated by Producer (or caused to be installed or operated by Producer).

Product ” means the crude oil produced from oil or gas wells, in its natural form, which may include Associated Water and Flash Gas naturally produced therewith.

Product Dedication ” means the dedication and commitment made by Producer pursuant to Section 2.1(a) .

Psig ” means pounds per square inch gauge.

Purchased Dedicated Production ” means Product produced by a Third Party that (a) either (i) has been purchased by Producer or (ii) the Parties have mutually agreed should be considered “Dedicated Production,” and (b) for which the Parties have agreed upon a Receipt Point for delivery into the Individual System.

Real Property Dedication ” means the dedication and commitment made by Producer pursuant to the first sentence in Section 2.1(b) .

Receipt Point ” means the point at which custody transfers from Producer to Midstream Co. The custody transfer point may include: (a) with respect to any Well serviced by a Separator Facility, each of the connecting flanges on the System located at or near such Separator Facility, which flanges connect such Separator Facility to the System, (b) with respect to any Well that is not serviced by a Separator Facility, each of the connecting flanges on the System that connect the Producer’s line to the System, (c) with respect to any Product delivered to an Individual System by truck, the applicable truck unload facility or (d) any other point as may be mutually

 

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agreed between the Parties. The Receipt Points in existence on the Effective Date shall be set forth in writing between Producer and Midstream Co, and additional points may become Receipt Points hereunder upon mutual agreement of the Parties as construction is completed on additional facilities in satisfaction of the needs identified by Producer and the Parties shall continuously update the list of Receipt Points by mutual agreement.

Recovered Oil ” means that portion of Product Controlled by Producer received into the Water System that is recovered by Midstream Co. If at any time Midstream Co is not providing gathering services to Producer in the Dedication Area with respect to Produced Water, there will be no Recovered Oil delivered into the Individual System.

Redetermination Deadline ” has the meaning given to it in Section 6.2(a)(ii) .

Redetermination Proposal ” has the meaning given to it in Section 6.2(a)(i) .

Redetermined Individual Fee ” has the meaning given to it in Section 6.2(a)(i) .

Reimbursed Amount ” has the meaning given to it in Section 10.1(a) .

Release Conditions ” has the meaning given to it in Section 2.4(a) .

Releases of Dedication ” is not applicable to Original Producer. For purposes of this Agreement, there have been no Releases of Dedication.

Rules ” has the meaning given to it in Section 17.6 .

Separator Facility ” means the surface facility where the Product produced from one or more Wells in the Dedication Area is collected and gas and Associated Water are separated from the Product. A Separator Facility may be known by the Original Producer as an econode but may also refer to a well pad or other facility from which Product is delivered into the System.

Services ” means: (a) the receipt of Producer’s owned or Controlled Product (including Associated Water and Flash Gas, as applicable in the approved System Plan) at the Receipt Points; (b) the receipt of Producer’s owned or Controlled Drip Condensate and Recovered Oil, (c) the gathering of such Product; (d) the storage of such Product; (e) the gathering of such Associated Water from the applicable Well to the point in the Individual System where Associated Water is delivered into the Water System, (f) the heating, separation, and chemical and other treatment of Product to remove Associated Water and Flash Gas from the Product prior to the applicable Delivery Point to the extent agreed between Producer and Midstream Co and to the extent required to meet Oil Quality specification of Downstream Facilities or markets designated by the Producer; (g) the redelivery of Product to Producer at the applicable Delivery Point for Producer’s account (inclusive of actual System gains or losses for the respective Individual System), (h) the delivery of Flash Gas into the Gas System at an appropriate Delivery Point; and (i) the other services to be performed by Midstream Co in respect of such Product as set forth in this Agreement and the System Plan for an Individual System, all in accordance with the terms of this Agreement (including any services with respect to metering services).

Services Fee ” means, collectively, the fees described in Section 6.1 .

 

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Spacing Unit ” means the area fixed for the drilling of one Well by order or rule of any applicable Governmental Authority, or (if no such order or rule is applicable) the area fixed for the drilling of a Well or Planned Well reasonably established by the pattern of drilling in the applicable area or otherwise established by Producer in its reasonable discretion.

Standard & Poor’s ” means Standard & Poor’s Rating Group, a division of McGraw Hill, Inc., or any successor to its statistical rating business.

State ” means the state in which the Individual System is located.

System ” means all Individual Systems described in all of the Agreement Addenda, collectively, including: (a) pipelines; (b) central facilities inclusive of pumping, heating, separating, treating, stabilizing, vapor recovery, and other equipment, (c) controls; (d) Delivery Points, meters and measurement facilities; (e) storage for Product; (f) easements, licenses, rights of way, fee parcels, surface rights and Permits; (g) pumping facilities, if any, and (h) all appurtenant facilities, in each case, that are owned, leased or operated by each Midstream Co to provide Services to Producer or Third Parties, as such gathering system and facilities are modified or extended from time to time to provide Services to Producer pursuant to the terms hereof or to Third Parties, including the Facility Segments operated under this Agreement by each Midstream Co specified in the Agreement Addenda.

System Gains/Losses ” means any Product, in terms of Barrels, received into the System that is lost, gained, or otherwise not accounted for incident to, or occasioned by, the gathering, and redelivery, of Product, including Product lost or gained in connection with the operation of a pipeline, excluding line pack for new facilities. System Gains/Losses will be determined and allocated on an Individual System basis.

System Plan ” has the meaning given to it in Section 3.1(c) .

Target On-Line Date ” means (a) with respect to a Planned Separator Facility or, with respect to a Planned Well that is not intended to be serviced by a Separator Facility, such Planned Well, in either case, that is described for the first time in the Original Report, the date specified in the Original Report for the applicable Planned Separator Facility or Planned Well, as applicable, (b) with respect to any Planned Separator Facility or, with respect to any Planned Well that is not intended to be serviced by a Separator Facility, such Planned Well, in either case, that is described in a First Development Report that is not the Original Report, 18 Months after the date of such First Development Report, unless Midstream Co consents to a shorter time period, and (c) with respect to any Planned Separator Facility or, with respect to any Planned Well that is not intended to be serviced by a Separator Facility, such Planned Well, in either case, that is not described in the First Development Report, 18 Months after the date of the Development Report that initially reflects the Planned Separator Facility or Planned Well, as applicable, unless Midstream Co consents to a shorter time period.

Target Pressure ” means 90 Psig, as measured at the inlet to the applicable central facility, unless otherwise set forth in writing between Producer and Midstream Co.

Tender ” means the act of Producer’s making Product available or causing Product to be made available to the System at a Receipt Point. “ Tendered ” shall have the correlative meaning.

 

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Term ” has the meaning given to it in Section 8.1 .

Third Party ” means any Person other than a Party to this Agreement or any Affiliate of a Party to this Agreement.

Third Party Assignment ” has the meaning given to it in Section 16.1(a) .

Transaction Document ” means each agreement entered into pursuant to the agreement terms and conditions related to gas gathering services, agreement terms and conditions related to oil gathering services, agreement terms and conditions related to produced water services, agreement terms and conditions related to gas processing services, agreement terms and conditions related to crude oil treating services, and agreement terms and conditions related to fresh water services, now or in the future existing between Producer and Midstream Co.

Transfer ” means a sale, conveyance, assignment, exchange, farmout, disposition or other transfer of Dedicated Properties by Original Producer under Section 16.2(b) . In other Sections of this Agreement where the term uses a lower case, the term is not intended to have such a restrictive meaning.

Water System ” means the Produced Water system used to provide Produced Water services to Producer.

Well ” means a well (i) for the production of hydrocarbons, (ii) that is located in the Dedication Area, (iii) in which Producer owns an interest, and (iv) for which Producer has a right or obligation to market Product produced thereby through ownership or pursuant to a marketing, agency, operating, unit, or similar agreement.

Year ” means a period of time from January 1 of a calendar year through December 31 of the same calendar year; provided that the first Year shall commence on the Effective Date and run through December 31 of that calendar year, and the last Year shall commence on January 1 of the calendar year and end on the Day on which this Agreement terminates.

Section 1.2 Other Terms . Other capitalized terms used in this Agreement and not defined in Section 1.1 above have the meanings ascribed to them throughout this Agreement.

Section 1.3 References and Rules of Construction . All references in this Agreement to Exhibits, Appendices, Articles, Sections, subsections and other subdivisions refer to the corresponding Exhibits, Appendices, Articles, Sections, subsections and other subdivisions of or to this Agreement unless expressly provided otherwise. Titles appearing at the beginning of any Articles, Sections, subsections and other subdivisions of this Agreement are for convenience only, do not constitute any part of this Agreement, and shall be disregarded in construing the language hereof. The words “this Agreement,” “herein,” “hereby,” “hereunder” and “hereof,” and words of similar import refer to this Agreement as a whole, including the applicable Agreement Addendum and all Exhibits, Appendices, and other attachments to these Agreement Terms and Conditions and the applicable Agreement Addendum, all of which are incorporated herein, and not to any particular Exhibit, Appendix, Article, Section, subsection or other subdivision unless expressly so limited. The word “including” (in its various forms) means “including without limitation.” The word “or” shall mean “and/or” unless a clear contrary

 

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intention exists. The word “from” means from and including, the word “through” means through and including, and the word “until” means until but excluding. All references to “$” or “dollars” shall be deemed references to United States dollars. The words “will” and “shall” have the same meaning, force, and effect. Each accounting term not defined herein will have the meaning given to it under generally accepted accounting principles. Pronouns in masculine, feminine or neuter genders shall be construed to state and include any other gender, and words, terms and titles (including terms defined herein) in the singular form shall be construed to include the plural and vice versa, unless the context otherwise requires. References to any Law, contract or other agreement mean such Law, contract or agreement as it may be amended, supplemented, released, revised, replaced, or otherwise modified from time to time.

Article 2

Product Dedication and Real Property Dedication

Section 2.1 Producer’s Dedications .

(a) Product Dedication . Subject to Section 2.2 through Section 2.4 , during the Term, Producer exclusively dedicates and commits to deliver to Midstream Co under this Agreement, as and when produced, all of the Dedicated Production and agrees not to deliver any Dedicated Production to any other gatherer, purchaser, marketer, or other Person prior to delivery to Midstream Co at the Receipt Points.

(b) Real Property Dedication . Subject to Section 2.2 through Section 2.4 , during the Term, Producer grants, dedicates, and commits the Dedicated Properties to Midstream Co for performance of the Services pursuant to this Agreement. Except for the Parties’ performance of their obligations under this Agreement, no further performance is required by either Party to effectuate the Real Property Dedication.

Section 2.2 Conflicting Dedications .

(a) Notwithstanding anything in this Agreement to the contrary, Producer shall have the right to comply with (i) each of the Conflicting Dedications existing on the Effective Date or, in the case of a Producer Assignee, the effective date of such assignment, and (ii) any other Conflicting Dedication applicable as of the date of acquisition of any oil and gas leases, mineral interests, and other similar interests within the Dedication Area that are acquired by Producer after the Effective Date and otherwise would have become subject to the Dedications (but not any Conflicting Dedications entered into in connection with such acquisition). Without the prior written consent of Midstream Co (which shall not be unreasonably withheld), Producer shall not extend or renew any Conflicting Dedication and shall terminate each Conflicting Dedication as soon as permitted under the underlying contract without causing Producer to incur any costs or expenses deemed unreasonable or inappropriate in the opinion of Producer and shall not enter into any new Conflicting Dedication. If services of the type provided hereunder are being provided to Producer by a Third Party with respect to Dedicated Properties under a Conflicting Dedication, then 180 Days prior to the expiration of such Conflicting Dedication, if requested by Producer, Midstream Co and Producer shall have a Meeting of Senior Management (unless both Parties agree that a Meeting of Senior Management is not required) to assess whether Midstream Co is ready, willing and able to begin providing Services with respect to such Dedicated

 

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Properties concurrently with the anticipated expiration or termination of the applicable Conflicting Dedication. If Midstream Co cannot provide Producer such assurances, then Midstream Co shall deliver to Producer a written consent to the extension of the applicable Conflicting Dedication. In no event shall Producer be required to begin using Services provided by Midstream Co on a Day other than the first Day of a Month.

(b) Certain Conflicting Dedications contain rights of first refusal or other provisions that (i) entitle Producer to a release of acreage from such Conflicting Dedication if Producer dedicates the released acreage to a Third Party or (ii) expressly prohibit Producer from dedicating such released acreage to an Affiliate of Producer. As used herein, the term “ Conflicting Dedication ” shall include both the original right of first refusal (or similar right) and the dedication resulting from an exercise of such right of first refusal (or similar right) so long as the resulting dedication covers the same acreage as the original Conflicting Dedication.

(c) To the extent Producer claims that a Conflicting Dedication exists with respect to certain Services on specified Dedicated Properties, Midstream Co shall have the right to review the documentation creating such Conflicting Dedication, subject to confidentiality requirements applicable to such Conflicting Dedication.

Section 2.3 Producer’s Reservation . Producer reserves the following rights respecting Dedicated Production for itself:

(a) to operate (or cause to be operated) Wells producing Dedicated Production in its sole discretion, including the right to drill new Wells, repair and rework old Wells, temporarily shut in Wells, renew or extend, in whole or in part, any oil and gas lease or term mineral interest, or cease production from or abandon any Well or surrender any applicable oil and gas lease, in whole or in part, when no longer deemed by Producer to be capable of producing in paying quantities under normal methods of operation;

(b) Reserved;

(c) to deliver such Dedicated Production or furnish such Dedicated Production to Producer’s lessors and holders of other burdens on production with respect to such Dedicated Production as is required to satisfy the terms of the applicable oil and gas leases or other applicable instruments; and

(d) to pool, communitize or unitize Producer’s interests with respect to Dedicated Production.

Section 2.4 Releases from Dedication .

(a) Permanent Releases . Midstream Co shall permanently release from the Dedications: (i) any Dedicated Production from any Well, Dedicated Properties, or Spacing Unit affected by one or more of the Release Conditions, (ii) any Dedicated Production that would have been delivered to a Separator Facility affected by one or more of the Release Conditions, (iii) any Dedicated Properties affected by one or more of the Release Conditions and (iv) any Purchased Dedicated Production for which the Individual System has been affected by one or more of the Release Conditions. The “ Release Conditions ” are:

(i) Midstream Co’s failure to complete the facilities that are described on a System Plan and that are necessary to connect any Planned Separator Facility or Planned Wells to the System or failure to commence the Services with respect to any Planned Separator Facility or Planned Wells by the applicable On-Line Deadline (so long as such failure was not the result of Producer’s failure to comply with the then-applicable Development Report);

 

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(ii) Midstream Co’s election (x) pursuant to Section 3.1(c) not to provide Services for any Well or Separator Facility included in a Development Report delivered by a Producer that is not the Original Producer or (y) pursuant to Section 3.3(b) not to provide Services for (1) any Well or Separator Facility for which Producer failed to deliver a Development Report on or before the applicable deadline set forth in Section 3.1(a) , (2) any Well or Separator Facility not described in the applicable Development Report or (3) any excess volume of Product produced from any Well during any Day that exceeds the volume included in Producer’s estimate set forth in the most recent Development Report delivered to Midstream Co;

(iii) expiration of the Term, as further described in Section 8.2 ;

(iv) written agreement of Producer and Midstream Co, and each Party shall consider in good faith any proposal by the other Party to permanently release any Dedicated Production or Dedicated Properties;

(v) the occurrence of a Force Majeure of the type described in clauses (l), (m) or (n) of the definition of “ Force Majeure ” affecting Midstream Co that continues for a period of 120 Days or more;

(vi) Midstream Co’s interruption or curtailment of receipts and deliveries of Product from any Well or Separator Facility pursuant to Section 5.5 that continues for 90 Days or more, except to the extent (A) such interruption or curtailment is caused by the acts or omissions of Producer, or (B) Producer elects to reduce the Individual Fee with respect to any volumes that are affected by a Downtime Event pursuant to Section 6.2(c) ;

(vii) a default (other than a default of the type covered by Section 2.4(a)(i) ) by Midstream Co that remains uncured for 90 Days or more;

(viii) Producer’s rejection of any increase in the Individual Fee pursuant to Section 13.1(b) ; or

(ix) Midstream Co’s suspension of Services pursuant to Section 13.2(a)(ii) that extends for the period of time stated in such Section or (y) Midstream Co’s election not to expand an Individual System pursuant to Section 13.2(b) .

Producer may deliver any Dedicated Production released from the Dedications pursuant to this Section 2.4(a) to such other gatherers as it shall determine.

(b) Temporary Release . Midstream Co shall temporarily release from the Dedications: (i) any Dedicated Production from any Well, Dedicated Properties, or Spacing Unit

 

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affected by one or more of the Interruption Conditions, (ii) any Dedicated Production that would have been delivered to a Separator Facility affected by one or more of the Interruption Conditions, (iii) any Dedicated Properties affected by one or more of the Interruption Conditions, and (iv) any Purchased Dedicated Production for which the Individual System has been affected by one or more of the Interruption Conditions. The “ Interruption Conditions ” are:

(i) the occurrence and continuation of an uncured default by Midstream Co;

(ii) Midstream Co’s interruption or curtailment of receipts and deliveries of Product pursuant to Section 5.5 that continues for a period of 15 consecutive Days, except to the extent (A) such interruption or curtailment is caused by the acts or omissions of Producer, or (B) Producer elects to reduce the Individual Fee with respect to any volumes that are affected by a Downtime Event pursuant to Section 6.2(c) ; and

(iii) Until a permanent release is required under Section 2.4(a) or Section 13.2 , Midstream Co’s suspension of Services pursuant to Section 13.2(a) (and, if Section 13.2(a)(i) applies, such temporary release shall continue at the discretion of Midstream Co, subject to the time limits set forth in Section 13.2(a)(i) ).

Producer may make alternative arrangements for the gathering of any Dedicated Production temporarily released from the Dedications pursuant to this Section 2.4(b) . To the extent that an interruption or curtailment can be limited to a Facility Segment, Midstream Co shall so limit such interruption or curtailment, and to the extent that Midstream Co does so limit such curtailment or interruption, the temporary release permitted by this Section 2.4(b) shall only apply to the affected Facility Segment. Such temporary release shall continue until the first Day of the Month after the Month during which Midstream Co cures the applicable default or the interruption, curtailment, or suspension of Services terminates; provided that, if Producer obtained temporary services from a Third Party (pursuant to a contract that does not give rise to a default under this Agreement) during the pendency of such default, interruption, curtailment, or suspension, such release shall continue until the earlier of (A) the first Day of the Month that is six Months after the event or condition that gave rise to the interruption, curtailment or other temporary cessation has been corrected and (B) the first Day of the Month after the termination of the applicable contract with such Third Party. For the avoidance of doubt, the temporary services that Producer may obtain under Section 3.3 shall not constitute a release under the terms of this Agreement; provided that, if Producer cannot obtain such temporary services without a temporary release, Midstream Co may in its discretion grant or refuse to grant a temporary release on such terms as reasonably required by Midstream Co (including, for example, conditioning the grant of a temporary release on the establishment of a termination date for such temporary release).

(c) Evidence of Release . At the request of Producer, the Parties shall execute a release agreement reasonably acceptable to all Parties (which, in the case of a permanent release, shall be in recordable form) reflecting any release of Dedicated Production or Dedicated Properties pursuant to this Section 2.4 .

Section 2.5 Covenants Running with the Land . Subject to the provisions of Section 2.3 and Section 2.4 , each of the Dedications (a) is a covenant running with the Dedicated

 

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Properties, (b) touches and concerns Producer’s interests in the Dedicated Properties, and (c) shall be binding on and enforceable by Midstream Co and its successors and assigns. Except as set forth in Article 16, (i) in the event Producer sells, transfers, conveys, assigns, grants or otherwise disposes of any or all of its interest in the Dedicated Properties, then any such sale, transfer, conveyance, assignment, grant or other disposition shall be made subject to this Agreement and (ii) in the event Midstream Co sells, transfers, conveys, assigns, grants or otherwise disposes of any or all of its interest in the Individual System, then any such sale, transfer, conveyance, assignment, grant or other disposition shall be made subject to this Agreement. The Real Property Dedication is not an executory contract under Section 365 of Title 11 of the United States Code (11 U.S.C. § 365).

Section 2.6 Recording of Agreement . Producer hereby authorizes Midstream Co to record a memorandum of the Agreement in the real property records of the counties in which the Dedication Area is located. Midstream Co and Producer agree that until Midstream Co provides notice to the contrary, all payment terms and pricing information shall remain confidential and be redacted from any filings in the real property records.

Article 3

System Expansion and Connection of Wells

Section 3.1 Development Report; System Plan; Meetings .

(a) Development Report . Original Producer will provide, on or before October 1, 2016, and each Producer Assignee will provide, on or before the date stated in Section 16.1 , Midstream Co with its First Development Report, which shall describe (x) in detail the planned development, drilling, and production activities relating to the Dedicated Production through the end of the applicable Period of Two Years, and (y) generally the long-term drilling and production expectations for those project areas in which drilling activity is expected to occur during the applicable Period of Five Years, including the information described in Section 3.1(b) . On or before each January 1, each April 1, each July 1, and each October 1 of each Year following the date on which the First Development Report is to be delivered, Producer shall provide to Midstream Co an update of the then-current report (the First Development Report, as updated in accordance with the foregoing and as the then current report may be updated from time to time, the “ Development Report ”).

(b) Development Report Content . With respect to the Dedication Area, the Development Reports shall include information as to

(i) the Wells (each, a “ Planned Well ”) and Separator Facilities (each, a “ Planned Separator Facility ”) that Producer expects to drill or install during the applicable Period of Two Years, including the expected locations, completion dates thereof (which completion dates shall not be earlier than the applicable Target On-Line Dates), the expected spud dates of such Planned Wells, and dates flow is anticipated to initiate from such Wells;

(ii) the anticipated Oil Quality of the production from any Well and Separator Facility that Producer expects to produce during the applicable Period of Two Years;

 

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(iii) the Receipt Points and Delivery Points (including proposed receipt points and delivery points not yet agreed in writing among the Parties) at which Product produced from each Well is to be delivered by or redelivered to Producer during the applicable Period of Two Years;

(iv) the number of Planned Wells and Planned Separator Facilities anticipated to be producing after the Period of Two Years and before the end of the Period of Five Years, broken out by an appropriate geographic area, such as a development plan area;

(v) the actual lateral length for each Well described in the Period of Two Years, the anticipated lateral length for each Planned Well described in the Period of Two Years and initial assumptions for the planned lateral length for each Planned Well anticipated to be producing after the Period of Two Years and before the end of the Period of Five Years;

(vi) the number of rigs that Producer intends to operate in the Dedication Area each year during the Period of Five Years (including sufficient detail regarding the anticipated location of such rigs to allow Midstream Co to determine which Individual System would be impacted by such rig activity);

(vii) with respect to the Period of Two Years, the anticipated date of each frac, the quantity of fresh water required to complete such frac and an indication of the type of frac to be performed (slick, hybrid gel, gel, etc);

(viii) with respect to the Period of Two Years, the anticipated date on which Midstream Co may initiate construction or other development activities at the Well or Separator Facility in order to complete the interconnection into the Individual System; and

(ix) such other information as may be reasonably requested by Midstream Co with respect to Wells and Separator Facilities that Producer intends to drill or from which Producer intends to deliver Product during the Period of Two Years and Period of Five Years.

To the extent possible, any information Producer is required to provide under this Section 3.1(b) with respect to Wells or Separator Facilities shall also include such information related to Planned Wells and Planned Separator Facilities. In addition, if appropriate to provide a complete and accurate Development Report, any information requested with respect to Planned Wells and Planned Separator Facilities shall also be provided with respect to existing Wells or Separator Facilities.

(c) System Plan . Based on the Development Report and such other information about the expected development of the Dedicated Properties as shall be provided to Midstream Co by or on behalf of Producer, including as a result of meetings between representatives of Midstream Co and Producer, Midstream Co shall develop and periodically update a plan (the “ System Plan ”) describing or depicting the modifications, extensions, enhancements, major maintenance and other actions necessary in order for the Individual System to be able to provide timely Services for the Product produced by the Wells and Separator Facilities described in the

 

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most recent Development Report (including Planned Wells, Planned Separator Facilities and changes in anticipated production from existing Wells and Separator Facilities). Without limiting or otherwise altering Midstream Co’s rights under Section 13.2 , unless the applicable Well or Separator Facility is operated by Original Producer, Midstream Co may elect, in its sole discretion, not to make such modifications, extensions, enhancements, major maintenance, or other actions to the System (the “ Modifications ”) and not to provide Services for any Wells or Separator Facilities included in a Development Report delivered by a Producer that is not the Original Producer. If (i) Midstream Co elects to make such Modifications, (ii) Producer thereafter modifies the Development Report or provides other information (the date on which the modified Development Report or such other information is provided to Midstream Co, the “ Cancellation Date ”) indicating that such Modifications are no longer necessary, and (iii) as of the Cancellation Date, the actual aggregate costs and expenses (excluding Excluded Amounts) incurred or committed by Midstream Co to make such cancelled Modifications exceeds $100,000.00, then Producer shall reimburse Midstream Co for all reasonable and documented costs and expenses (other than the Excluded Amounts) incurred or committed by Midstream Co through the Cancellation Date to make such Modifications. The System Plan (or, with respect to the allocation procedures described in clause (vi), the applicable writing signed by Midstream Co and Producer) shall include information as to:

(i) each Facility Segment then existing and operational, under construction, or planned and the Individual System of which such Facility Segment is a part;

(ii) all Receipt Points and Delivery Points served or to be served by each such Facility Segment;

(iii) estimated gathering pressures for the 12 Month period beginning on the Target On-Line Date for the applicable Facility Segment and the Target Pressures for each Individual System included in the Development Report;

(iv) all pumps, heaters, stabilizers, treatment, Associated Water and Flash Gas separation, and other major physical facilities located or to be located on or within each such Facility Segment, together with their sizes, operating parameters, capacities, and other relevant specifications (including the maximum operating pressures of the low pressure gathering lines and the high pressure gathering lines), which sizes, parameters, capacities and other relevant specifications shall be sufficient to (x) connect the Individual System to the Receipt Points and Delivery Points for all Planned Separator Facilities and (with respect to any Planned Wells not intended to be serviced by a Separator Facility) Planned Wells set forth in the most recent Development Report and (y) perform the Services for all Dedicated Production projected to be produced from the Dedicated Properties as contemplated by the most recent Development Report;

(v) the anticipated schedule for completing the construction and installation of the planned Facility Segments and all planned Receipt Points and Delivery Points, in each case, for all Planned Separator Facilities or Planned Wells, as applicable, included in the most recent Development Report;

 

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(vi) the allocation methodologies to be used by Midstream Co with respect to System Gains/ Losses, Other System Fuel and other allocations hereunder (including, to the extent required by a writing signed by Producer and Midstream Co, allocations with respect to Drip Condensate, Recovered Oil and Flash Gas) and, with respect to any System Plan after the initial System Plan, any proposed changes to the allocation methodologies then in effect, which allocation methodologies shall (A) permit allocations to be made by Midstream Co in a commercially reasonable manner; and (B) be based upon the measurements taken and quantities determined for the applicable Month. To the extent required by a writing signed by Producer and Midstream Co, Midstream Co shall allocate, in a manner that is commercially reasonable and determined by Midstream Co in good faith, to a particular Receipt Point, the Flash Gas, Recovered Oil and Drip Condensate from a Facility Segment.

(vii) other information reasonably requested by Producer that is relevant to the design, construction, and operation of the System, the relevant Individual System, the relevant Facility Segment, and the relevant Receipt Points and Delivery Points; provided that in no event shall Midstream Co be obligated to supply to Producer (A) pricing, budget or similar financial information or (B) information that is covered by a confidentiality agreement or confidentiality obligations;

Midstream Co shall deliver the applicable System Plan (including any updated System Plan) to Producer for Producer’s review and comment not later than 30 Days after Producer’s delivery to Midstream Co of the applicable Development Report or amendment thereto.

(d) Meetings . Midstream Co shall make representatives of Midstream Co available to discuss the most recent System Plan with Producer and its representatives at Producer’s written request. Producer shall make representatives of Producer available to discuss the most recent Development Report with Midstream Co and its representatives at Midstream Co’s written request. The Parties agree that the meetings described in the previous sentences of this clause (d) may occur (and shall, if requested by either Party) on a Monthly basis. At all such meetings, the Parties shall exchange updated information about their respective plans for the development and expansion of the Dedicated Properties (including amendments to the Development Report) and the System (including amendments to the System Plan for Producer’s review and comment) and shall have the opportunity to discuss and provide comments on the other Party’s plans.

(e) Scope and Purpose of Planning Tools . The Development Report and the System Plan are intended to assist Midstream Co and Producer with long-term planning and goals. None of the Development Reports nor the System Plans shall amend or modify this Agreement in any way. Midstream Co may, in its sole discretion, work with OpCo or any of OpCo’s subsidiaries to prepare and deliver a System Plan jointly with such other entity or entities. To the extent that a Development Report or System Plan that satisfies the requirements above is delivered or deemed delivered under any other Transaction Document, such Development Report or System Plan shall be deemed delivered hereunder.

 

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Section 3.2 Expansion of System and Connection of Separator Facilities .

(a) Service Standards . Midstream Co shall, at its sole cost and expense, design, construct (as applicable), and own the Individual System in a good and workmanlike manner and in accordance with the System Plan and this Section 3.2 . Until such time as Producer has delivered a Development Report, Midstream Co shall have no obligation under this Section 3.2 (a) .

(b) On-Line Deadline . Subject to Section 12.2 , Midstream Co shall by the later of (x) the date that the first Planned Well on a particular Planned Separator Facility (or, with respect to a Planned Well that is not intended to be serviced by a Separator Facility, the date that such Planned Well) is ready for connection to the System and (y) the applicable Target On-Line Date (such later date, the “ On-Line Deadline ”): (i) have completed (or caused the completion of) the construction of the necessary facilities, in accordance with the then current System Plan, (A) to connect such Planned Separator Facility or such Planned Well to the System and (B) to connect the System to each planned Delivery Point for such Planned Separator Facility or such Planned Well, as applicable, and (ii) be ready and able to commence Services with respect to Dedicated Production from such Planned Separator Facility or Planned Well, as applicable.

(c) Additional/Accelerated Well . From time to time, Producer may provide notice to Midstream Co that Producer has accelerated the Target On-Line Date for a Planned Well or Planned Separator Facility (any such Well or Separator Facility, an “ Additional/Accelerated Well ”). Midstream Co will use its commercially reasonable efforts to modify the System Plan and to cause the necessary gathering facilities to be constructed prior to the On-Line Deadline for such Additional/Accelerated Well. From time to time, Producer may provide notice to Midstream Co that Producer (i) has delayed the Target On-Line Date for a Planned Well or Planned Separator Facility, (ii) subject to Section 3.2(d) , anticipates eliminating a Planned Well or Planned Separator Facility from its development plans and the Development Report, or (iii) anticipates shutting in a Well or Separator Facility that has been producing. Midstream Co may adjust the System Plan as it determines to be appropriate and commercially reasonable to accommodate such elimination of such Wells and Separator Facilities.

(d) Cancellation of Planned Wells and Planned Separator Facilities . If (i) Midstream Co reasonably determines that Producer has permanently abandoned the drilling or installation of any Planned Well or Planned Separator Facility or Producer notifies Midstream Co that Producer intends to permanently abandon the drilling or installation of any Planned Well or Planned Separator Facility (whether through the delivery of an updated Development Report or otherwise, the date on which such determination is made, the “ Abandonment Date ”), (ii) Midstream Co had begun to design or construct the Facility Segment to connect such Planned Well or Planned Separator Facility to the System prior to such Abandonment Date, and (iii) the actual aggregate costs and expenses (excluding Excluded Amounts) incurred or committed by Midstream Co prior to the Abandonment Date exceeds $100,000.00, then Producer shall reimburse Midstream Co for all reasonable and documented costs and expenses (other than the Excluded Amounts) incurred or committed by Midstream Co prior to such Abandonment Date to design and construct such Facility Segment.

(e) Substation and Interconnection Facilities . The obligations of Midstream Co hereunder to design and construct the Individual System and to perform the Services do not include the design or construction of any substation or other interconnecting facilities required to procure electricity for the Individual System. If a substation or any other interconnecting facility is required in order for Midstream Co to perform its obligations hereunder, Midstream Co and Producer shall enter into a separate agreement setting forth each Party’s responsibilities in connection therewith, including an allocation of responsibility for all associated costs and expenses.

 

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Section 3.3 Temporary Services.

(a) Pending the completion of facilities contemplated in a System Plan or that may be required to service Wells in existence as of the Effective Date, Producer may enter into a contract with a Third Party to provide services with respect to the Dedicated Production that is anticipated to be serviced by the new, modified, or enhanced facilities if the term of such contract does not exceed six Months (and may be renewed in six-Month increments until such time as Midstream Co has completed the applicable facilities).

(b) If at any time, (i) Producer fails to deliver a Development Report on or before the applicable deadline set forth in Section 3.1(a) , (ii) a Development Report delivered by Producer failed to describe any Well, or (iii) the average rate of production at any Receipt Point described in the then-applicable Development Report exceeds Producer’s forecast for such Receipt Point set forth in such Development Report, and as a result, Midstream Co has not completed any new, modified, or enhanced facilities necessary to allow Midstream Co to accept all of the Product Tendered by Producer at a Receipt Point, then (x) within a reasonable time after Midstream Co becomes aware of the need for such new, modified, or enhanced facilities, Midstream Co shall elect, in its sole discretion, whether to proceed with the development and completion of such facilities by providing notice to Producer, and (y) if Midstream Co elects to proceed with the development and completion of such facilities, (1) Midstream Co shall cause such facilities to be completed within a reasonable time after such election, and (2) pending the completion of such facilities, Midstream Co may elect (in its reasonable discretion and in exchange for reasonable compensation) to permit Producer to enter into a contract with a Third Party as provided in Section 3.3(a) to provide services with respect to the Dedicated Production that Midstream Co is unable to accept.

(c) Any time Producer makes alternative arrangements with a Third Party for the provision of services or to accept Product as provided for in this Agreement, Producer shall (i) if Midstream Co anticipates being able to provide Services hereunder or to accept Product within a period of time that is shorter than six Months, use commercially reasonable efforts to enter into a contract with a term that expires on or around the date on which Midstream Co anticipates being able to provide Services hereunder or to accept Product, and (ii) notify Midstream Co of the term of such contract promptly after execution thereof. Prior to requiring Producer to begin using, or resume using, as applicable, Services hereunder, Midstream Co shall provide notice to Producer of the date on which Midstream Co expects to be ready, willing and able to begin providing Services to Producer no later than 45 Days prior to the expiration of the Third Party contract. In no event shall Producer be required to begin using, or resume using, as applicable, Services on a Day other than the first Day of a Month.

 

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Section 3.4 Cooperation . The Parties shall work (at their own cost and expense) together in good faith to obtain such Permits as are necessary to drill and complete each Planned Well and construct the required extensions of the System to each Planned Separator Facility (and each Planned Well, as applicable) as expeditiously as reasonably practicable, all as provided in this Agreement. The Parties shall cooperate with each other and to communicate regularly regarding their efforts to obtain such Permits. Upon request by Producer, Midstream Co shall promptly provide to Producer copies of all Permits obtained by Midstream Co in order to construct any Facility Segment (or portion of a Facility Segment) of the System.

Section 3.5 Grant of Access; Real Property Rights .

(a) Producer s Grant of Access . Producer hereby grants to Midstream Co, without warranty of title, either express or implied, to the extent that it may lawfully and is contractually permitted to do so without the incurrence of additional expense, the rights of ingress and egress with respect to, and the right to access, all lands constituting Dedicated Properties for the purpose of using, maintaining, servicing, inspecting, repairing, and operating all or any portion of the applicable Individual System, including all pipelines, meters and other equipment necessary for the performance by Midstream Co of this Agreement. Such right of access shall not include any right to install, replace, disconnect, or remove all or any portion of the applicable Individual System, which rights may only be granted pursuant to a separate instrument entered into pursuant to Section 3.5(f) .

(b) Producer Does Not Have Obligation to Maintain . Producer shall not have a duty to maintain in force and effect any underlying agreements (such as any lease, easement, or surface use agreement) that the grant of access by Producer to Midstream Co under Section 3.5(a) is based upon, and such grant will terminate if Producer loses its rights to the applicable property, regardless of the reason for such loss of rights.

(c) Midstream Co s Grant of Access . Midstream Co hereby grants to Producer, without warranty of title, either express or implied, to the extent that it may lawfully and is contractually permitted to do so without the incurrence of additional expense, the rights of ingress and egress with respect to, and the right to access, all lands covered by the Individual System in order to exercise its rights and obligations hereunder. Such right shall not include any right to install, replace, disconnect, or remove any facilities on such lands, which rights may only be granted pursuant to a separate instrument entered into pursuant to Section 3.5(f) . Producer shall release, protect, defend, indemnify and hold harmless Midstream Co Group from and against all Losses directly or indirectly arising out of or in connection with bodily injury, death, illness, disease, or loss or damage to property of Midstream Co or any member of Midstream Co Group directly arising from Producer’s exercise of its access rights hereunder, except to the extent such Losses are caused by the gross negligence or willful misconduct of Midstream Co Group.

(d) Midstream Co Does Not Have Obligation to Maintain . Midstream Co shall not have a duty to maintain in force and effect any underlying agreements that the grant of access by Midstream Co to Producer pursuant to this Section 3.5(d) is based upon, and such grant will terminate if Midstream Co loses its rights to the applicable property, regardless of the reason for such loss of rights.

 

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(e) No Interference . A Party’s exercise of the rights granted to a Party by the other Party pursuant to this Section 3.5 shall not unreasonably interfere with the granting Party’s operations or with the rights of owners in fee with respect to the applicable lands, and such rights will be exercised in material compliance with all applicable Laws and the safety and other reasonable access requirements of the granting Party. Each Party obtaining a right of access pursuant to this Section 3.5 shall have the status of “licensee,” except when such Party is accessing the applicable real property by way of a right-of-way, easement, or other similar real property right granted pursuant to a separate instrument.

(f) Real Property Rights . Each Party shall acquire and maintain all easements, rights of way, surface use, surface access agreements, and other real property rights from Third Parties necessary to perform its obligations hereunder. To the extent a Party has the contractual right and title to do so, such Party shall provide to the other Party the right of co-usage on the easements, sub-easements, rights of way, surface use, and other real property rights held by such Party covering lands for which the other Party requires real property rights to perform its obligations hereunder, all at no cost to the providing Party and on terms and conditions mutually acceptable to the Parties in their reasonable discretion. Where a Party does not have the contractual right to do so, such Party shall provide reasonable assistance to the other Party in obtaining the real property rights with respect to such lands as necessary or desirable to perform its obligations hereunder.

Article 4

Measurement Devices

Section 4.1 Measurement Devices.

(a) Midstream Co shall construct, install, own, and operate (or cause to be constructed, installed, and operated) the Measurement Devices located at the Measurement Points. Midstream Co may, in its discretion, construct, install, own, and operate (or cause to be constructed, installed, and operated) Measurement Devices located at or upstream of the Delivery Points or at or downstream of the Receipt Points.

(b) Midstream Co shall cause all Measurement Devices that are owned by Midstream Co to be constructed, installed, and operated in accordance with applicable industry standards and applicable Laws, and as set forth in the current System Plan.

(c) Producer shall have the right, at its sole expense, to install, own and operate Measurement Devices located at the Measurement Points, Receipt Points and Delivery Points. Producer shall cause Producer Meters to be installed, subsequent to providing a minimum of 72 hours’ notice to Midstream Co, so as not to interfere with Midstream Co’s Measurement Devices and shall take steps that are reasonable and customary in the industry to mitigate or prevent any problems that may interfere with Midstream Co’s Measurement Devices at the Measurement Points.

(d) Midstream Co may elect to use a Producer Meter as the Measurement Device for a Measurement Point in lieu of constructing, installing, owning, and operating a Measurement Device located at such Measurement Point by providing notice to Producer (including by

 

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detailing such election in the applicable System Plan). If Midstream Co elects to use such Producer Meter as the Measurement Device for a Measurement Point, Producer shall provide Midstream Co reasonable access to such Producer Meter, including prior advance notice of, and the ability to witness, the calibration of such Producer Meter.

(e) Producer and Midstream Co shall cause Measurement Devices owned by such Party to be constructed, installed and operated in accordance with the following depending on the type of meter used:

(i) API Manual of Petroleum Measurement Standard, Chapter 6.1, Metering Assemblies, Lease Automatic Custody Transfer (LACT)

(ii) API, MPMS, Spec 11N, Specification for Lease Automatic Custody Transfer (LACT)

(f) Midstream Co may (but shall not be obligated to) replace or make any alterations to the Measurement Devices necessary to comply with any subsequent amendments, revisions or modifications of applicable Law or the American Gas Association Reports cited above. With respect to Producer Meters that Midstream Co has elected to use, Producer may (but shall not be obligated to) replace or make any alterations to the Measurement Devices necessary to comply with any subsequent amendments, revisions or modifications of applicable Law or the American Gas Association Reports cited above.

(g) The accuracy of all Measurement Devices at the Measurement Points and Delivery Points and of all Measurement Devices that serve as “check meters” for any such Measurement Point or Delivery Point Measurement Devices will be verified by the owner of such Measurement Device (the “ Owner ”) at Monthly intervals and, if requested, in the presence of a representative of the other Party (the “ Beneficiary ”). The Owner shall verify the accuracy of any owned Measurement Device before the next Monthly verification required by the preceding sentence if the Beneficiary makes a written request for a special test as described below. Notwithstanding the foregoing, when Daily deliveries of Product at any Measurement Point or Delivery Point average 100 Barrels per Day or less during any Month, the Owner may request from the Beneficiary that the accuracy of the Measurement Devices at such Measurement Point or Delivery Point be verified quarterly. If, upon any test, any (i) Measurement Device at the Measurement Point is found to be inaccurate by 2.0% or less or (ii) Measurement Device at the Delivery Point is found to be inaccurate by 0.25% or less, previous readings of such Measurement Device will be considered correct in computing the deliveries of Product under this Agreement. If, upon any test, any (1) Measurement Device at the Measurement Point is found to be inaccurate by more than 2.0% or (2) Measurement Device at the Delivery Point is found to be inaccurate by more than 0.25% (excessive meter factor deviation), such Measurement Device will immediately be removed from service, adjusted, repaired or replaced to record accurately (within the manufacturer’s allowance for error) and reproved prior to returning to service. If the excessive meter factor deviation can be explained by changing conditions (gravity, temperature or flow-rate) no corrective action may be taken if mutually agreed upon by both the Owner and the Beneficiary. Any previous recordings of such Measurement Device with an excessive meter factor deviation will be corrected by using the arithmetic average of the malfunction factor and the previous factor shall be applied to the production measured through the meter between the

 

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date of the previous factor and the date of the malfunction factor. The proving report must clearly indicate the meter’s malfunction factor and all remarks associated with the repairs or adjustments. If the Beneficiary desires a special test of any Measurement Device, at least 72 hours’ advance written notice will be given to the Owner, and the Parties will cooperate to secure a prompt test of the accuracy of such Measurement Device. If the Measurement Device so tested is found to be inaccurate by 2.0% or less or 0.25% or less, as applicable, the Owner will have the right to bill the Beneficiary for the costs incurred due to such special test, including any labor and transportation costs, and the Beneficiary will pay such costs promptly upon invoice therefor.

(h) If requested by the Beneficiary, the Measurement Devices owned by Owner shall include a sufficient number of data ports, and Owner shall permit Beneficiary to connect to such data ports, as shall be required to provide to Beneficiary on a real-time basis all measurement data generated by such measurement equipment. Beneficiary shall be responsible at its own cost for obtaining equipment and services to connect to such data ports and receive and process such data.

(i) Each Party shall make the charts and records by which measurements are determined available for the use of the other Party in fulfilling the terms and conditions thereof. Each Party shall, upon written request of the other Party, mail, email or deliver for checking and calculation all volume, BS&W, and gravity, average flowing temperature, average flowing pressure and other meter or test records in its possession and used in the measurement or allocation of Product delivered under this Agreement within 30 Days after the last chart for each billing period is removed from the meter. Such data shall be returned within 90 Days after the receipt thereof.

(j) Each Party shall preserve or cause to be preserved for mutual use all test data or other similar records in accordance with the applicable rules and regulations of regulatory bodies having jurisdiction, if any, with respect to the retention of such records, and, in any event, for at least 24 Months.

(k) So long as the Parties to this Agreement are also parties to a Transaction Document that covers Gas, the requirements for Measurement Devices in respect of Flash Gas shall be covered by such Transaction Document. If at any time the Parties to this Agreement are not also party to another Transaction Document that covers Gas, the Parties shall set forth in the Agreement Addendum or an appropriate amendment to this Agreement the requirements for Measurement Devices pertaining to Flash Gas; absent such agreement, Midstream Co shall install and maintain measuring equipment at the Delivery Points that is in accordance with applicable API standards.

Section 4.2 Measurement Procedures . Midstream Co shall use the Measurement Devices owned by Midstream Co (or if Midstream Co’s rights under Section 4.1(d) are exercised, then the Measurement Devices owned by Producer) at the Measurement Points to determine the volumes of Product passing through the Individual System for purposes of Article 6 and Article 10 . Midstream Co shall cause (or if Midstream Co’s rights under Section 4.1(d) are exercised, then Producer shall cause) the measurements of the quantity and quality of all Product measured at the Measurement Points (and at each Receipt Point or Delivery Point at which measurements are taken) to be conducted in accordance with industry standards (referenced below) and governmental regulations, BLM Onshore Order No. 4: Measurement of Oil.

 

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API Manual of Petroleum Measurement Standards:

Chapter 4, Proving Systems

Chapter 5.1. General Considerations for Measurement by Meters

Chapter 5.6, Measurement of Liquid by Coriolis Meters

Chapter 7, Temperature Determination

Chapter 8, Sampling

Chapter 8.2, Automatic Sampling of Petroleum and Petroleum Products

Chapter 9, Density Determination

Chapter 10, Sediment and Water

Chapter 12.2, Calculation of Petroleum Quantities Measured by Turbine or Displacement Meters

Section 4.3 Product Meter Adjustments . If a Measurement Device is out of service or registering inaccurately, the Parties shall determine the quantities of Product received or delivered during such period as follows:

(a) By using the registration of any check meter or meters, if installed and accurately registering; or in the absence of such check meters,

(b) By using a meter operating in parallel with the estimated volume corrected for any differences found when the meters are operating properly,

(c) By correcting the error if the percentage of error is ascertainable by calibration, tests or mathematical calculation, such as step change, uncertainty calculation or balance adjustment; or in the absence of check meters and the ability to make corrections under this Section 4.3(c) , then,

(d) By estimating the quantity received or delivered by receipts or deliveries during periods under similar conditions when the meter was registering accurately.

Article 5

Tender, Nomination, and Gathering of Production

Section 5.1 Limitations on Service to Third Parties . Midstream Co shall obtain Original Producer’s consent prior to offering services on an Individual System to any Third Party, unless (a) Midstream Co is required by a Governmental Authority to offer service to a Third Party, in which case Midstream Co shall provide Producer prior notice of offering such

 

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service to such Third Party, (b) such Third Party has become a Producer hereunder by virtue of assignment of Dedicated Properties to such Party, or (c) Original Producer has ceased to operate acreage serviced by such Individual System.

Section 5.2 Tender of Dedicated Production . Subject to Section 5.3(c) , (a) each Day during the Term, Producer shall Tender to the Individual System at each applicable Receipt Point all of the Dedicated Production available to Producer at such Receipt Point, and (b) Producer shall have the right to Tender to Midstream Co for Services under this Agreement Product other than Dedicated Production.

Section 5.3 Services; Service Standard.

(a) Services . Subject to Section 5.3(c) , Midstream Co shall (i) provide Services for all Product that is Tendered by the Producer to Midstream Co at the applicable Receipt Point, (ii) redeliver to Producer or for the benefit of Producer at the relevant Delivery Point (as designated by Producer) equivalent quantities of such Product, less any Associated Water and Flash Gas removed therefrom attributable to Producer’s owned or Controlled Product, taking into account any System Gains/ Losses, and (iii) cause the System to be able to flow such Product at volumes produced into each Individual System, in each case, so long as total crude volumes for the respective Individual System are not greater than the current capacity of the System.

(b) Services Standard . Midstream Co shall own and operate the System and perform the Services in a good and workmanlike manner in accordance with standards customary in the industry.

(c) Priority of Service . Midstream Co shall cause (i) Product delivered by Original Producer to have priority service on the System over Product of any Producer Assignee to the extent not in violation of applicable Law, and (ii) Product delivered by Producer to have priority service on the System over Product of any Third Party. Midstream Co’s performance of its obligations under Section 5.3(a) with respect to any Product (A) of any Producer Assignee, or (B) produced from any Well but not included on a Development Report or for which new, modified, or enhanced facilities are contemplated in a System Plan, shall at all times be subject to the available capacity on the System at the time that Product is available to be Tendered by Producer at a Receipt Point; provided, however, that in the case of clause (B), Producer may make alternative arrangements for the Product not received by Midstream Co pursuant to Section 3.3 .

Section 5.4 Nominations, Scheduling, and Curtailment . Nominations and scheduling of Product available for, and interruptions and curtailment of, Services under this Agreement shall be performed in accordance with the following provisions:

(a) Nominations . Product shall be received only under a nomination submitted by Producer. For purposes of this Agreement, a nomination is the volume, in Barrels per day, forecasted by Producer to be delivered to Receipt Points and redelivered by Midstream Co to Delivery Points for a particular month of Deliver. Nominations shall be submitted on or before the 25th day of the Month preceding the Month of delivery.

 

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(b) Reserved.

(c) Consistent Quantities . Producer and Midstream Co shall use commercially reasonable efforts to cause Product to be received and redelivered under this Agreement at similar quantities for a delivery Month. System storage shall be used only for the operational purposes of Midstream Co, as determined solely by Midstream Co.

(d) Target Pressures .

(i) Reserved.

(ii) Maintenance of Pressure on System.   Midstream Co shall use its commercially reasonable efforts to maintain the operating pressure of each Facility Segment, as measured at the inlet flange of the central facility of the applicable Facility Segment, at a level that is equal to or less than the Target Pressure. Except in the event of (A) Force Majeure or an event or condition downstream of the System that was not caused by Producer or Midstream Co, or (B) maintenance or repairs that result in a suspension, shutdown or curtailment of the applicable Facility Segment as specified in Section 5.5 , if (1) the operating pressure of a Facility Segment measured at such inlet flange continuously exceeds the Target Pressure for a period of more than 5 Days (any such period, an “ Overage Period ”), (2) such increased operating pressure is not a result of Producer’s production exceeding the production forecast in the Development Report on which the applicable Facility Segment was based, and (3) Midstream Co has sufficient production data available to confirm that the increased pressure is not a result of Producer’s production exceeding such production forecast, then commencing on the first day after the expiration of the applicable Overage Period, the Individual Fee for the applicable Facility Segment shall be reduced by the reduction percentage corresponding to the applicable Pressure Overage Percentage on the chart on Exhibit C for a period of time equal in length to such Overage Period.

(e) Adjustments . Nothing contained in this Agreement shall preclude Midstream Co from taking reasonable actions necessary to adjust receipts or deliveries under this Agreement in order to maintain the operational integrity and safety of the System.

(f) Line Fill .

(i) Producer shall deliver to Midstream Co a pro rata portion of the Product that Midstream Co determines is necessary for efficient operation of the System (such pro rata portion, the “ Producer Line Fill ”), and Midstream Co shall not be obligated to receive any Product Tendered by Producer until Producer’s delivery of Product to Midstream Co has met the Producer Line Fill.

(ii) Midstream Co shall maintain an inventory account (the “ Inventory Account ”) for Producer and each other shipper or producer on the System which reflects for each Month with respect to each producer and shipper on the System (including Producer) (i) the total volumes received and delivered; (ii) the starting and ending minimum line fill required; (iii) the starting and ending amount of crude oil inventory in Midstream Co’s facilities above the minimum line fill required; and (iv) any other

 

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information deemed necessary and appropriate by Midstream Co, all on an Individual System basis. Midstream Co shall provide a statement of Producer’s Inventory Account as part of the supplemental and supporting information for each invoice.

(iii) At the end of the Term, Producer’s Product in inventory (both Producer Line Fill and any amounts above Producer Line Fill quantities) within Midstream Co’s System, or within the respective Individual System within Midstream Co’s System, will be delivered by Midstream Co to the Delivery Point specified by Producer within sixty (60) days after the end of the Term.

Section 5.5 Suspension/Shutdown of Service .

(a) Shutdown . During any period when all or any portion of the Individual System is shut down (i) because of maintenance, repairs, or Force Majeure, (ii) because such shutdown is necessary to avoid injury or harm to Persons or property, to the environment or to the integrity of all or any portion of the Individual System or (iii) because providing Services hereunder has become uneconomic as further described in Section 13.2 , Midstream Co may interrupt or curtail receipts of Producer’s Product and the Product of other producers as set forth herein. In such cases, Midstream Co shall have no liability to Producer (subject to Section 11.1(b) ) for its failure to receive Product, except to the extent such shutdown is caused by the negligence, gross negligence or willful misconduct of Midstream Co. If Midstream Co is required to so interrupt or curtail receipts of Product, Midstream Co will advise (by telephone, following up by writing, which writing may be in the form of electronic mail) Producer of such interruption or curtailment as soon as practicable or in any event within twenty-four hours after the occurrence of such event.

(b) Planned Curtailments and Interruptions.

(i) Midstream Co shall have the right to curtail or interrupt receipts and deliveries of Product for brief periods to perform necessary maintenance of and repairs or modifications (including modifications required to perform its obligations under this Agreement) to the Individual System; provided, however, that to the extent reasonably practicable, Midstream Co shall coordinate its maintenance, repair and modification operations with the operations of Producer and, in any case, will use its reasonable efforts to schedule maintenance, repair and modification operations so as to avoid or minimize to the greatest extent possible service curtailments or interruptions.

(ii) Midstream Co shall provide Producer (x) with 60 Days prior notice of any upcoming normal and routine maintenance, repair and modification projects that Midstream Co has planned that would result in a curtailment or interruption of Producer’s deliveries and the estimated time period for such curtailment or interruption and (y) with six Months prior notice of any maintenance (A) of which Midstream Co has knowledge at least six Months in advance and (B) that is anticipated to result in a curtailment or interruption of Producer’s deliveries for five or more consecutive Days.

(iii) On or before January 1, 2017, Midstream Co shall provide a schedule of the expected planned maintenance for the System for the subsequent 12 Months.

 

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Thereafter, on or before October 1 of each Year, starting October 1, 2017, Midstream Co shall deliver a schedule of the expected planned maintenance for the System for the subsequent 12 Months. The delivery of this plan is intended as a tool to assist the Parties in planning and does not replace the notices required in the foregoing clauses and in no way commits Midstream Co to adhere to the schedule set forth in such 12-Month plan.

Section 5.6 Marketing and Transportation . As between the Parties, Producer shall make all necessary arrangements at and downstream of the Delivery Points, for the receipt, further transportation, and marketing of Producer’s owned and Controlled Product.

Section 5.7 No Prior Flow of Product in Interstate Commerce . Producer represents and warrants that at the time of Tender, none of the Product delivered at a Receipt Point hereunder has flowed in interstate commerce.

Article 6

Fees

Section 6.1 Fees . Producer shall pay Midstream Co each Month in accordance with the terms of this Agreement for all Services provided by Midstream Co with respect to Dedicated Production received by Midstream Co from Producer or for Producer’s account during such Month, an amount, for each Individual System, equal to the sum of (i) the product of (x) the Net Standard Volume of Product, stated in Barrels, received by Midstream Co from Producer or for Producer’s account at the applicable Receipt Points for such Product within the applicable Individual System during such Month, multiplied by (y) the applicable Individual Fee, (ii) ( reserved ) and (iii) an amount equal to Producer’s allocated portion of the actual costs incurred by Midstream Co for electricity required to provide Services, such allocation to be based upon the aggregate quantities of Product received by Midstream Co.

Section 6.2 Fee Adjustments .

(a) Redetermination .

(i) Redetermination Proposal . Between November 1 and December 31 of any Year, Midstream Co shall prepare and deliver to Producer for its review and comment a written proposal (each, a “ Redetermination Proposal ”) to redetermine each Individual Fee (unless the Parties mutually agree not to redetermine any particular Individual Fee) in accordance with this Section 6.2(a) . Each Redetermination Proposal shall include relevant supporting documentation based upon the latest updated Development Report and System Plan and shall take into account future items including projected production volumes, operating revenue projections, and budgeted amounts for capital expenditures and all estimated operating expenses that Midstream Co believes will be necessary to provide the applicable Services as contemplated by the latest updated Development Report and System Plan; provided that a redetermined Individual Fee as agreed to by the Parties (a “ Redetermined Individual Fee ”) shall not recoup the difference between (A) estimated operating expenses or revenues and (B) actual operating expenses or revenues for periods prior to the effective date of such Redetermined Individual Fee. The Parties may agree to redetermine a particular Individual Fee without obligation to agree to redetermine any other Individual Fee.

(ii) Subsequent Redetermination Timing . Any Redetermined Individual Fee agreed to by the Parties on or prior to the last Business Day of February of the applicable Adjustment Year (“ Redetermination Deadline ”) shall become effective as of the first Day of the Month following the Month in which agreement has been reached. If the Parties fail to agree upon a redetermination of any Individual Fee set forth in the applicable Redetermination Proposal on or prior to the Redetermination Deadline, such Individual Fee shall remain in effect without redetermination pursuant to this Section 6.2(a) . For purposes of this Section 6.2(a)(ii) , the Year immediately after the Year during which a Redetermination Proposal is delivered is herein the “ Adjustment Year .”

 

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(b) Annual Escalation . Effective as of July 1 of each Year, the Individual Fee will be increased by multiplying the then-applicable Individual Fee by the Escalation Percentage (herein, the “ Increase in Fee ”) and adding the then-applicable Individual Fee to the Increase in Fee; provided that Reimbursed Amounts shall not be subject to this Section 6.2(b) . Such annual increase to the Individual Fee shall become effective on July 1 of the applicable Year, even if such Individual Fee was redetermined pursuant to Section 6.2(a) , with an effective date during the same Year.

(c) Downtime Events . If during any Month (as applicable, the “ Applicable Month ”), (i) one or more Downtime Events occur with respect to a Facility Segment, (ii) such Downtime Events caused the Downtime Percentage for such Facility Segment during the Applicable Month to exceed the lowest percentage specified on Exhibit B during such Month, and (iii) Producer has waived its right to a temporary release of Dedicated Production under Section 2.4(b) , then the Individual Fee for the applicable Facility Segment shall be reduced by the reduction percentage corresponding to the applicable Downtime Percentage on the chart on Exhibit B during each hour in which such Facility Segment is available to provide Services (an “ Operating Hour ”) during the subsequent Month until the reduced Individual Fee has been applied to an aggregate number of Operating Hours equal to the aggregate number of Downtime Hours during the Applicable Month. If the aggregate number of Operating Hours during the subsequent Month is less than the aggregate number of Downtime Hours during the Applicable Month, the applicable reduced Individual Fee shall be applied to Operating Hours during the next-subsequent Month or Months until the reduced Individual Fee has been applied to an aggregate number of Operating Hours equal to the aggregate number of Downtime Hours during the Applicable Month. A reduced Individual Fee that would otherwise apply during any Month subsequent to an Applicable Month shall not be applied until all Downtime Hours from previous Applicable Months have been addressed as provided in this Section.

Section 6.3 Treatment of Byproducts, System Gains/Losses, Fuel and Related Matters . No separate fee shall be chargeable by Midstream Co and no refund or reduction in the Individual Fee shall be chargeable by or owed to Producer for the hydrocarbons or services described in this Section 6.3 , except as provided in Section 6.3(d) .

(a) Drip Condensate and Recovered Oil . Midstream Co shall deliver to Producer, each Month, all Drip Condensate and Recovered Oil allocated to Producer or for Producer’s account to the extent Producer and Midstream Co have agreed in writing to require such allocation.

 

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(b) Flash Gas . Midstream Co shall deliver to Producer, each Month, all Flash Gas allocated to Producer or for Producer’s account by delivering such Flash Gas into the Gas System to the extent Producer and Midstream Co have agreed in writing to require such allocation. At all times during the Term, either (x) Midstream Co and Producer shall be party to both this Agreement and another Transaction Document that covers Gas (in which case Producer shall not owe any amount under this Agreement or any other Transaction Document to which Midstream Co is a Party as a result of Flash Gas being transported through the Gas System) or (y) the Parties shall set forth in the Agreement Addendum or an appropriate amendment to this Agreement the methodology for Midstream Co to deliver Flash Gas to Producer and any fee applicable thereto.

(c) System Gains/Losses .

(i) Midstream Co will perform a Monthly material balance for each Individual System based on comparison of Product delivered, Product inventory change within Midstream Co’s facilities, and the theoretical Product (after removal of Associated Water and Flash Gas) received into the Individual System at Receipt Points (or measured if Associated Water and Flash Gas of Product at Receipt Points meets Oil Quality specifications of Downstream Facilities or markets without treatment by Midstream Co). Actual System gains or losses from the material balance will be allocated back to Producer’s Receipt Points to determine allocated quantities of Product received at Receipt Points for each Month.

(ii) If, during any Month, System Gains/Losses on an Individual System allocated to Producer in accordance with this Agreement exceeds 2.00% of the total quantities of Producer’s owned or Controlled Product delivered to the Individual System in such Month, then Midstream Co will, for the respective Individual System, obtain updated test data (i.e. sample results, meter proves, etc.) from Receipt Points involved in calculating theoretical Product (after removal of Associated Water and Flash Gas) received into the System at Receipt Points on the Individual System and conduct a field-wide (on an Individual System basis) meter inspection and proving, if necessary, followed by an updated balance. If Midstream Co determines that a repair to the Individual System is needed to reduce the System Gains/Losses below 2.00%, Midstream Co shall undertake such repairs in a commercially reasonable manner and as soon after making such determination as is commercially reasonable.

(iii) Midstream Co shall provide Producer with prior notice of, and reasonable access to observe, any such field-wide meter balance.

(d) Other System Fuel . Midstream Co may elect to use Other System Fuel as fuel to operate the Individual System, or to generate electricity for the operation of the Individual System and shall account for any Other System Fuel used by Midstream Co. Producer, at its sole cost and expense, shall procure all fuel except diesel, in addition to Other System Fuel used by Midstream Co, if any, required to operate the Individual System or to generate electricity for the operation of the Individual System and arrange for transportation of such fuel to the Individual System.

(e) Associated Water . Midstream Co shall deliver to Producer, each Month, all Associated Water allocated to Producer or for Producer’s account by delivering such Associated Water into the Water System. The Parties acknowledge that there is no separate fee chargeable by Midstream Co hereunder for Services with respect to Associated Water and that the fees chargeable by Midstream Co hereunder for Product sufficiently compensate Midstream Co for Services with respect to Associated Water. The Monthly Loss/ Gain Report shall include a statement of the Associated Water separated from the Product and delivered to Producer into the Water System.

 

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Article 7

Quality

Section 7.1 Quality Specifications .

(a) Each Individual System will be operated as a field System, and as such, Product received from Producer at the Receipt Points shall conform to the following quality specifications, provided that the following may be varied or adjusted as described in this Section 7.1 or by express language set forth in the applicable Agreement Addendum. Midstream Co will not accept any Product unless it meets the specifications listed in the chart below and unless other properties of such Product (viscosity, pour point, and other properties) are such that it will be readily susceptible to transportation through Midstream Co’s pipeline system. These specifications may be applied to each Barrel of Producer’s nomination and not be limited to the composite sample of the nomination.

 

    

Crude Oil

Sulfur Content, Weight %    <= 0.40
BS&W    <= 3.5%
   Of which, basic sediment is no more than
   <= 0.5%

(b) Reserved

(c) All Product delivered by Producer to Midstream Co shall have a maximum temperature of one hundred forty degrees (140º) Fahrenheit at the Receipt Point.

(d) From time to time, Midstream Co may require that Producer furnish certified laboratory reports showing the results of quality tests on the Product tendered for gathering. Midstream Co may also from time to time obtain samples for laboratory analysis to check compliance with the specifications cited above.

 

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(e) If any Product Tendered by Producer to the Individual System fails at any time to conform to the applicable specifications, then Midstream Co will have the rights specified in Section 7.2 .

(f) If Producer’s Product delivered to the Receipt Points complies with such quality specifications, then all Product redelivered at the Delivery Points by Midstream Co to Producer shall meet the quality specifications of the applicable Downstream Facility. Midstream Co may commingle Product received into the Individual System with other Product shipments and, subject to Midstream Co’s obligation to redeliver to Producer at the Delivery Points Product that satisfies the applicable quality specifications of the Delivery Points, (a) such Product shall be subject to such changes in quality, composition and other characteristics as may result from such commingling and the removal of Associated Water and Flash Gas (if any), (b) Midstream Co shall have no other obligation to Producer associated with changes in quality of Product as the result of such commingling and Associated Water and Flash Gas removal, and (c) Midstream Co shall have the right to change the quality specifications to comply with any changes in the Downstream Facility specifications.

Section 7.2 Failure to Meet Specifications . If any Product Tendered by Producer to the Individual System fails at any time to conform to the applicable specifications, then Midstream Co will have the right to discontinue receipt of such non-conforming Product. Unless such non-conforming Product creates a safety hazard or may damage existing infrastructure (in the opinion of Midstream Co), Midstream Co shall provide notice (which notice may be verbal initially, followed by written confirmation) to Producer twenty-four (24) hours prior to such discontinuation, and Producer shall cease delivery of Product until such time as the Product Tendered by Producer will again conform to the applicable specifications. If Producer fails to comply with the discontinuation notice (or deliver a formal dispute, as specified in the following sentence) prior to the expiration of twenty-four (24) hours after receiving such notice from Midstream Co, then Midstream Co shall be entitled to unilaterally cease receiving Product. If Producer disputes Midstream Co’s determination that any Product fails to conform to the applicable specifications, then Producer shall (a) notify Midstream Co thereof within twenty-four (24) hours after receiving such notice from Midstream Co, (b) submit the applicable Product to a mutually agreed upon Third Party laboratory, and (c) cause such laboratory to analyze the Product within seventy-two (72) hours after Producer’s receipt of Midstream Co’s notice of non-conformance (during which time Midstream Co shall continue to accept deliveries from Producer, unless Midstream Co believes such deliveries present a safety hazard or may damage installed infrastructure). If the results of such analysis provide that the applicable Product is non-conforming, the costs and expenses associated with such analysis shall be borne by Producer; if the results of such analysis provide that the applicable Product conforms to the specifications, then Midstream Co shall reimburse Producer for all reasonable and documented costs and expenses incurred by Producer to cause such Third Party laboratory to perform such analysis. Producer will promptly undertake commercially reasonable measures to eliminate the cause of such non-conformance. Midstream Co, in its sole discretion, may accept receipt, or continue to receive, non-conforming Product if the blending and commingling of such Producer’s non-conforming Product with other Product in the Individual System does not materially affect the System and the ability of Midstream Co to deliver Product at Delivery Points within applicable Delivery Point specifications. Midstream Co’s continued taking of non-conforming Product shall not relieve Producer of the responsibility to undertake commercially reasonable measures to eliminate the cause of such non-conformance.

Section 7.3 Indemnification Regarding Quality . PRODUCER SHALL RELEASE, PROTECT, DEFEND, INDEMNIFY AND HOLD HARMLESS MIDSTREAM CO GROUP FROM AND AGAINST ALL LOSSES DIRECTLY OR INDIRECTLY ARISING OUT OF, IN CONNECTION WITH OR IN ANY MANNER ATTRIBUTABLE TO THE FAILURE OF THE PRODUCT DELIVERED BY PRODUCER TO THE INDIVIDUAL SYSTEM TO MEET THE QUALITY SPECIFICATIONS SET FORTH HEREIN, INCLUDING DISPOSAL COSTS, DAMAGE TO OR SUSTAINED BY THE INDIVIDUAL SYSTEM (INCLUDING THE EQUIPMENT AND COMPONENT PARTS), COSTS EXPENDED BY MIDSTREAM CO OR ANY OF ITS AFFILIATES TO RETURN THE INDIVIDUAL SYSTEM AND RELATED FACILITIES TO SERVICES, CLAIMS OF OTHER PRODUCERS ON THE INDIVIDUAL SYSTEM, AND CLAIMS OF OWNERS OF ALL DOWNSTREAM FACILITIES.

 

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Article 8

Term

Section 8.1 Term . The term of this Agreement commenced on the Effective Date, and this Agreement shall remain in effect until the 16 th anniversary of the Effective Date (the “ Initial Term ”) and thereafter on a Year to Year basis until terminated by Midstream Co or Producer effective upon the expiration of the Initial Term or the expiration of any Year thereafter upon notice no less than 90 Days prior to the expiration of the Initial Term or the expiration of any Year thereafter (such period of time, the “ Term ”).

Section 8.2 Effect of Termination or Expiration of the Term . Upon the termination of the Term, this Agreement shall forthwith become void and the Parties shall have no liability or obligation under this Agreement, except that (a) the termination of this Agreement shall not relieve any Party from any expense, liability or other obligation or remedy therefor that has accrued or attached prior to the date of such termination, (b) the provisions of Section 7.3 , this Section 8.2 , Article 15 and Section 17.1 through Section 17.10 shall survive such termination and remain in full force and effect indefinitely, (c) the indemnities set forth in Section 3.5(c) shall survive such termination and remain in full force and effect indefinitely, and (d) Section 10.4 and Section 17.11 shall survive such termination and remain in full force and effect for the period of time specified in such Sections.

Article 9

Title and Custody

Section 9.1 Title . A nomination of Product by Producer shall be deemed a warranty of title to such Product by Producer or a warranty that Producer Controls the Product and has the right to deliver such Product for gathering under this Agreement, as applicable. Title to Product shall not transfer to Midstream Co by reason of Midstream Co’s performance of the Services.

Section 9.2 Custody . From and after Producer’s delivery of its owned or Controlled Product to Midstream Co at the Receipt Points, and until Midstream Co’s redelivery of such

 

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Product to or for Producer’s account at the applicable Delivery Points, as between the Parties, Midstream Co shall have custody and control of, and be responsible for, such Product. In all other circumstances, as between the Parties, Producer shall be deemed to have custody and control of, and be responsible for, such Product.

Article 10

Billing and Payment

Section 10.1 Statements .

(a) Ordinary Course . Midstream Co shall submit invoices to Producer on or before the 25th Day after the end of a Month (the “ Invoice Month ”). Each invoice shall be accompanied by supporting information for all amounts charged by such invoice. All amounts owed for Services provided during an Invoice Month shall be reflected on the applicable invoice for such Invoice Month; provided that to the extent any amount appearing on an invoice is in respect of an amount paid by Midstream Co to a Third Party (collectively, the “ Reimbursed Amount ”) or the calculation of such amount is contingent on information provided by a Third Party (collectively, the “ Conditional Amount ”), such Reimbursed Amount and Conditional Amount, shall be reflected on an invoice within 90 Days after the end of the Month in which such Reimbursed Amount was paid by Midstream Co.

(b) Reserved.

(c) Detail .  Midstream Co shall cause its invoices and supporting information to include information reasonably sufficient to explain and support any estimates and charges reflected therein, the reconciliation of any estimates made in a prior Month to the actual measurements for such Month, and any adjustments to prior period volumes and quantities.

(d) Monthly Loss/ Gain Report .  Midstream Co shall deliver to Producer, on or before the close of business of the 40th Day after the applicable Invoice Month a Monthly Loss/ Gain Report. If Midstream Co elects, it may deliver such Monthly Loss/ Gain Report concurrently with the applicable invoice.

(e) One Invoice; Netting .  To the extent that Midstream Co and Producer are party to this Agreement and one or more other Transaction Documents, one invoice may be delivered in respect of all amounts owing under such Transaction Documents. The Parties shall net all undisputed amounts due and owing or past due and owing arising under the Transaction Documents to which Producer and Midstream Co are parties such that the Party owing the greater amount shall make a single payment of the net amount to the other Party. No amounts owing to or by any Midstream Co may be set off against amounts owing to or by any other Midstream Co. No amounts owing to or by any Producer may be set off against amounts owing to or by any other Producer. To the extent possible, all fee adjustments set forth in Article 6 shall be accomplished by setoff or netting.

Section 10.2 Payments .

(a) Unless otherwise agreed by the Parties, all invoices under this Agreement shall be due and payable in accordance with each invoice’s instructions on or before the later of the 30th

 

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Day of each Month and the 10th Day after receipt of the invoice or, if such Day is not a Business Day, then on the next Business Day. All payments by Producer under this Agreement shall be made by electronic funds transfer to the account designated by Midstream Co. Any amounts not paid by the due date will be deemed delinquent and, with respect to amounts owed to Midstream Co, will accrue interest at the Interest Rate, such interest to be calculated from and including the due date but excluding the date the delinquent amount is paid in full.

(b) If Producer, in good faith, disputes the amount of any invoice of Midstream Co, Producer will pay Midstream Co such amount, if any, that is not in dispute and shall provide Midstream Co notice, no later than 30 Days after the date that payment of such invoice would be due under Section 10.2(a) , of the disputed amount accompanied by reasonable documentation to support Producer’s dispute. If Producer fails to provide notice of dispute within such 30-Day period, then Producer shall be deemed to have waived its right to dispute the applicable invoice, except for a dispute following an audit conducted in accordance with Section 10.4 . Following Midstream Co’s receipt of such dispute notice, Producer and Midstream Co shall endeavor in good faith to resolve such dispute, and if the Parties are unable to resolve such dispute within a reasonable time, such dispute may be resolved in accordance with Section 17.6 of this Agreement. Upon resolution of the dispute, any required payment shall be made within 15 Days after such resolution, and, if such amount shall be paid to Midstream Co, such amount shall be paid along with interest accrued at the Interest Rate from and including the due date but excluding the date paid.

Section 10.3 Adequate Assurances . If (a) Producer fails to pay according to the provisions hereof and such failure continues for a period of 5 Business Days after written notice of such failure is provided to Producer, (b) Producer is not the Original Producer or (c) Midstream Co has reasonable grounds for insecurity regarding the performance by Producer of any obligation under this Agreement, then Midstream Co, by notice to Producer, may, singularly or in combination with any other rights it may have, demand Adequate Assurance of Performance from Producer. “ Adequate Assurance of Performance ” means, at the option of Producer, any of the following, (x) advance payment in cash by Producer to Midstream Co for Services to be provided under this Agreement in the following Month or (y) delivery to Midstream Co by Producer of an irrevocable standby letter of credit or a performance bond, in form and substance reasonably acceptable to Midstream Co, issued by a Credit-Worthy Person, in an amount equal to not less than the aggregate proceeds due from Producer under Section 10.1 for the prior 2-Month period. Promptly following the termination of the condition giving rise to Midstream Co’s reasonable grounds for insecurity or payment in full of amounts outstanding, as applicable, Midstream Co shall release to Producer the cash, letter of credit, bond or other assurance provided by Producer (including any accumulated interest, if applicable, and less any amounts actually applied to cover Producer’s obligations hereunder).

Section 10.4 Audit . Each Party has the right, at its sole expense and during normal working hours, to examine the records of the other Party to the extent reasonably necessary to verify the accuracy of any statement, charge or computation made pursuant to the provisions of the Transaction Documents. The scope of such examination will be limited to the 24 Months preceding the date such notice of audit, statement, charge or computation was presented. No Party may conduct more than one audit (taking all Transaction Documents to which Producer is a party together) of another Party during any Year (except that, if a Party is in default hereunder,

 

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additional audits may be conducted during the continuance of such default). If any such examination reveals any inaccuracy in any statement or charge, the necessary adjustments in such statement or charge and the payments necessitated thereby shall be made within 60 Days of resolution of the inaccuracy. This provision of this Agreement will survive any termination of this Agreement for the later of (a) a period of 24 Months from the end of the Year in which the date of such termination occurred or (b) until a dispute initiated within the 24 Month period is finally resolved, in each case for the purpose of such statement and payment objections.

Article 11

Remedies

Section 11.1 Suspension of Performance; Temporary Release from Dedication .

(a) Suspension by Midstream Co as Remedy for Payment Default . If Producer fails to pay any invoice rendered under Article 10 , such failure is not due to a good faith dispute by Producer in accordance with Section 10.2(b) , and such failure is not remedied within 5 Business Days after Producer’s receipt of written notice of such failure from Midstream Co, Midstream Co shall have the right, at its sole discretion, to (i) suspend performance (including withholding any payments that are owed by Midstream Co to Producer, and such withheld amounts shall not be subject to setoff under Section 10.1(e) ) under this Agreement until such amount, including interest at the Interest Rate, is paid in full or (ii) continue performing the Services under this Agreement, and, acting in a commercially reasonable manner, sell any Product delivered by Producer to the Receipt Points on Producer’s behalf, and use the proceeds therefrom to reimburse Midstream Co for any amounts due and owing to Midstream Co, and, at Producer’s election, either (y) remit any excess amounts received under such sale to Producer or (z) reduce the Services Fee due from Producer to Midstream Co for the following Month by the amount of such excess.

(b) Additional Suspensions as Remedies . If a Party fails to perform or comply with any material warranty, covenant or obligation (other than as provided in Section 11.1(a) or Section 2.4(a)(i)) contained in this Agreement and such failure has not been remedied within 60 Days after its receipt of written notice from the other Party of such failure, then the non-defaulting Party shall have the right to suspend performance of its obligations under this Agreement that are affected by such failure or non-compliance (including withholding any payments that are owed to the other Party, and such withheld amounts shall not be subject to netting or setoff under Section 10.1(e)); provided that Producer may not withhold any payments that are owed to Midstream Co for Services actually performed by Midstream Co. Original Producer’s failure to accurately track, calculate and timely provide support of the total Net Acres sold pursuant to Section 16.2(b)(ii) shall constitute a material breach of Original Producer’s obligations hereunder.

(c) Specific Performance and Declaratory Judgments . Damages in the event of breach of this Agreement by a Party hereto may be difficult, if not impossible, to ascertain. Therefore, each Party, in addition to and without limiting any other remedy or right it may have, will have the right to seek a declaratory judgment and 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

 

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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 Party from pursuing any other rights and remedies at law or in equity that such Party may have.

Section 11.2 No Election . In the event of a default by a Party under this Agreement, the other Party shall be entitled in its sole discretion to pursue one or more of the remedies set forth in this Agreement, or such other remedy as may be available to it under this Agreement, at Law or in equity, subject, however, to the limitations set forth in Section 11.3 and Article 15 . No election of remedies shall be required or implied as the result of a Party’s decision to avail itself of a remedy under this Agreement.

Section 11.3 DIRECT DAMAGES . A PARTY’S DAMAGES RESULTING FROM A BREACH OR VIOLATION OF ANY REPRESENTATION, WARRANTY, COVENANT, AGREEMENT OR CONDITION CONTAINED IN THIS AGREEMENT OR ANY ACT OR OMISSION ARISING FROM OR RELATED TO THIS AGREEMENT SHALL BE LIMITED TO ACTUAL DIRECT DAMAGES AND SHALL NOT INCLUDE ANY OTHER LOSS OR DAMAGE, INCLUDING INDIRECT, SPECIAL, CONSEQUENTIAL, INCIDENTAL, EXEMPLARY OR PUNITIVE DAMAGES, INCLUDING LOST PROFITS, PRODUCTION, OR REVENUES, AND EACH PARTY RELEASES THE OTHER PARTY FROM ALL SUCH CLAIMS FOR LOSS OR DAMAGE OTHER THAN ACTUAL DIRECT DAMAGES; PROVIDED THAT THIS LIMITATION TO DIRECT DAMAGES SHALL NOT LIMIT THE PARTIES’ INDEMNIFICATION OBLIGATIONS UNDER Section 3.5(c) , Section 7.3 , AND Article 15 .

Article 12

Force Majeure

Section 12.1 Force Majeure . If either Midstream Co or Producer is rendered unable by an event of Force Majeure to carry out, in whole or part, its obligations under this Agreement and such Party gives notice (which notice may initially be delivered orally so long as written notice is delivered as soon as reasonably practicable thereafter) and reasonably full details of the event (including the nature, extent, effect, and likely duration of the event or circumstances constituting the Force Majeure event) to the other Party as soon as practicable after the occurrence of the event, then, during the pendency of such Force Majeure, but only during that period, the obligations of the Party affected by the event shall be canceled or suspended, as applicable, to the extent required; provided , however , that notwithstanding anything in the foregoing to the contrary, no Party shall be relieved from any indemnification obligation or any obligation to make payments, as the result of Force Majeure, regardless of which Party is affected; provided further that if the Force Majeure impacts only a particular Facility Segment or Individual System, then the suspension of obligations described in this sentence shall apply only to the applicable Facility Segment or Individual System and not to the obligations owing in connection with the rest of the System. The Party affected by Force Majeure shall use commercially reasonable efforts to remedy the Force Majeure condition with all reasonable dispatch, shall give notice to the other Party of the termination of the Force Majeure, and shall resume performance of any suspended obligation promptly after termination of such Force Majeure.

Section 12.2 Extension Due to Force Majeure . If a Party is unable to meet any deadline set forth herein as a result of a Force Majeure, then provided that such Party complies with the provisions of Section 12.1 , such deadline shall be extended for a period of time equal to the period of time during which such Party is delayed due to the Force Majeure.

 

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Article 13

Change in Law; Uneconomic Service

Section 13.1 Changes in Applicable Law .

(a) If any new Laws are enacted or amended or any new interpretations in respect of previously existing Laws are issued after the Effective Date that require Midstream Co to make capital expenditures with respect to the System, then Midstream Co may propose an increase to the applicable Individual Fee as may be necessary or appropriate to preserve and continue for the Parties the rights and benefits originally contemplated for the Parties by this Agreement; provided, however , that no increase to the applicable Individual Fee pursuant to this Section 13.1 shall be applicable unless and until, in the reasonable judgment of Midstream Co, Midstream Co would be required to make capital expenditures with respect to the System in order to comply with such new Law that materially and adversely affects the economics of the Services provided, fees received, or the other economic benefits of this Agreement for Midstream Co.

(b) Producer shall accept or reject, in its sole discretion, Midstream Co’s proposed increase to the Individual Fee within 30 Days after receiving such proposal from Midstream Co. If Producer fails to provide notice of such acceptance or rejection within such 30-Day period, then Producer shall be deemed to have accepted such increase. If Producer rejects the amount of the proposed increase, then Midstream Co shall release the Wells, Separator Facilities, Receipt Points, Spacing Units, and Dedicated Production that would have been affected by such increase in accordance with Section 2.4(a)(viii) . The Parties will amend, update, or revise the applicable Agreement Addendum in accordance with this Agreement to reflect any changes in the applicable Individual Fees agreed to in accordance with this Section 13.1 .

(c) Producer and Midstream Co shall use their commercially reasonable efforts to comply with new and amended applicable Laws and new interpretations of existing Laws.

Section 13.2 Unprofitable Operations and Rights of Termination .

(a) Cessation of Services . If, in the sole discretion of Midstream Co, (x) the gathering of Product from any Wells, Separator Facilities or Receipt Points, (y) the delivery of Product to any Delivery Points or (z) the provision of any other Service under this Agreement, is or becomes uneconomical due to its volume, quality, or for any other cause, then Midstream Co shall not be obligated to provide the applicable Services so long as such condition exists.

(i) If Midstream Co suspends Services under this Section 13.2(a) as a result of Producer’s (A) negligence, willful misconduct, or breach of this Agreement, (B) delivery of Product that fails to meet the quality specifications required by Section 7.1 , or (C) execution of a plan of development that deviates from the then-applicable Development Report, then Midstream Co may resume providing such Services at any

 

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time, upon two months’ advance written notice delivered to Producer, and the affected Wells, Separator Facilities, Receipt Points, Spacing Units and Dedicated Production shall only be permanently released as a result of suspension under this clause by mutual agreement of the Parties under Section 2.4(a)(iv) .

(ii) If Midstream Co suspends Services under this Section 13.2(a) for any reason other than as specified in clause (i) above and (x) such suspension continues for six consecutive Months or (y) Midstream Co delivers notice to Producer that such suspension shall be permanent, then the applicable Wells, Separator Facilities, Receipt Points, Spacing Units, and Dedicated Production shall be permanently released as specified in Section 2.4(a)(viii) .

(b) Election not to Expand System . If Midstream Co determines, in its discretion, that an expansion of the Individual System to satisfy the needs of Producer, as described in Section 3.2 hereof, would be uneconomical, then Midstream Co shall neither be obligated to undertake such expansion nor to provide the applicable Services. Producer shall be entitled to a release of the applicable Planned Wells, Planned Separator Facilities and Dedicated Production pursuant to Section 2.4(a)(ix) immediately upon Midstream Co’s delivery of a System Plan (marked as “Final”) indicating that a requested expansion would be uneconomical pursuant Section 13.2(d) .

(c) Start Date of Suspension of Services . Midstream Co shall cause any suspension of Services permitted by this Section 13.2 to commence on the first Day of a Month and not on any other Day.

(d) Supporting Documentation and Management Discussions . As soon as Midstream Co determines that an expansion of the Individual System will not be economic or that continuing to provide Services at existing facilities has been rendered uneconomic, Midstream Co shall communicate the same to Producer.

(i) With respect to existing facilities, such notice shall be delivered to Producer at least 180 Days in advance of any proposed curtailment under this Section 13.2 and such notice shall be accompanied by documentation supporting its claim that certain Services have become uneconomical. Commencing on the date on which such notice is delivered and continuing for 180 Days, Midstream Co shall participate in Meetings of Senior Management if so requested by Producer, so long as such Meetings of Senior Management are scheduled at mutually agreeable times and locations, in order to negotiate a transition of Services that will not materially adversely affect Producer. Such discussions may include the following matters and such other matters aimed at ameliorating the detrimental effects of Midstream Co ceasing to provide Services: (A) purchase by Producer from Midstream Co of the pipe, rights of way or other assets necessary for the types of services that otherwise would have been performed under this Agreement, (B) a continuation of the provision of Services hereunder by Midstream Co for a period of time longer than the 180 Days required hereby in order to permit Producer sufficient time to take over operations or find an alternate midstream service provider and (C) adjustments to the Development Plan or rework certain Wells in order to address the concerns of Midstream Co with respect to providing Services thereto. In no event shall

 

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Midstream Co’s obligation to be available for Meetings of Senior Management create an obligation on Midstream Co to continue providing services past the 180 Days required hereby, and Midstream Co is under no obligation to agree to any amendments to this Agreement or modifications to the Services provided in order to accommodate requests of Producer during such negotiations. However, both Parties have an obligation to negotiate in good faith during such discussions.

(ii) With respect to planned facilities, Midstream Co shall indicate that providing Services to Planned Wells or Planned Separator Facilities is uneconomical by failing to include the necessary expansion projects in the applicable System Plan and shall provide supporting documentation for its determination that such expansion would be uneconomical, if requested by Producer. If Midstream Co delivers a System Plan (marked as “Final”) describing the necessary expansion projects, such delivery shall be deemed to be a commitment by Midstream Co to complete such expansion without exercising its rights under Section 13.2(b) , so long as conditions (including anticipated throughput, pricing, the ability to obtain rights-of-way, Producer’s continued execution of the Development Report, and any other factors deemed material by Midstream Co) do not materially change; provided, however that upon the initiation of Services through such expansion project or through a component part of such expansion project, such expansion (or applicable portion thereof) shall be considered “existing facilities” for purposes of this Section 13.2 and Midstream Co shall have all of the rights set forth herein with respect to existing facilities that become uneconomical. Nothing in this Section 13.2(d) shall give Producer a right to consent to a suspension under this Section 13.2 .

(e) No Obligation to Drill or Operate . Without limiting the right of Producer to revise the Development Report to eliminate any proposed Wells or Separator Facilities, nothing herein shall be construed to require Producer to drill any Well, to continue to operate any Well, to place any new Separator Facility into service or to maintain the operation of any Separator Facility that a prudent operator would not in like circumstances drill or continue to operate.

Article 14

Regulatory Status

Section 14.1 Non-Jurisdictional System . The Services being provided by Midstream Co hereunder are intended to be gathering services, and no Governmental Authority currently establishes the rates or terms of service relating to the Services. This Agreement is subject to all valid present and future Laws of Governmental Authorities now or hereafter having jurisdiction over the Parties, this Agreement, the Services performed, or the System. It is the intent of the Parties that no Governmental Authority shall alter any provisions in the Agreement in such a way that would have the effect of altering the economic benefits of either Party, as originally contemplated under this Agreement. The Parties shall (a) vigorously defend and support in good faith the enforceability of this Agreement and the continuance, without alternation, of the Services in any and all proceedings before any Governmental Authority in which this Agreement is subject to review and (b) not initiate or support, either directly or indirectly, any challenge with any Governmental Authorities to the rates provided herein or any other modification to this Agreement that would alter the economic benefits of a Party as originally contemplated under this Agreement.

 

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Section 14.2 Government Authority Modification . Notwithstanding the provisions of Section 14.1 , if the rates are changed or required to be changed or any other modification to this Agreement that alters the economic benefits of a Party, as originally contemplated under this Agreement, in response to any order, regulation, or other mandate of a Governmental Authority, then no such change or modification shall constitute a breach or other default under the terms of this Agreement, and the Parties shall negotiate in good faith to enter into such amendments to this Agreement or a separate arrangement in order to give effect, to the greatest extent possible, the economic benefit as originally contemplated in this Agreement. If, in the reasonable opinion of Midstream Co’s counsel, a Governmental Authority’s regulation of Midstream Co’s results in (a) Midstream Co not having the same economic benefits as originally contemplated under this Agreement or (b) Midstream Co’s or any of its Affiliate’s pipelines becoming subject to additional legal requirements or regulation, and the Parties have not mutually agreed as to how to mitigate or alleviate the foregoing, then Midstream Co shall have the right, without liability, to terminate this Agreement.

Article 15

Indemnification and Insurance

Section 15.1 Reciprocal Indemnity . To the fullest extent permitted by applicable Law and except as otherwise set forth in Section 3.5(c) and Section 7.3 :

(a) Producer Indemnification . Producer shall release, protect, defend, indemnify and hold harmless Midstream Co Group from and against all Losses directly or indirectly arising out of or in connection with bodily injury, death, illness, disease, or loss or damage to property of Producer or any member of Producer Group in any way arising out of or relating to this Agreement, directly or indirectly. THIS RELEASE, DEFENSE AND INDEMNITY OBLIGATION SHALL APPLY REGARDLESS OF FAULT OF MIDSTREAM CO GROUP OR ANY OTHER PERSONS.

(b) Midstream Co Indemnification . Midstream Co shall release, protect, defend, indemnify and hold harmless Producer Group from and against all Losses directly or indirectly arising out of or in connection with bodily injury, death, illness, disease, or loss or damage to property of Midstream Co or any member of Midstream Co Group in any way arising out of or relating to this Agreement, directly or indirectly. THIS RELEASE, DEFENSE AND INDEMNITY OBLIGATION SHALL APPLY REGARDLESS OF FAULT OF PRODUCER GROUP OR ANY OTHER PERSONS.

(c) Regardless of Fault . AS USED IN THE PRECEDING TWO SUBCLAUSES, THE PHRASE “REGARDLESS OF FAULT” SHALL MEAN, WITH RESPECT TO ANY LOSS THAT IS CAUSED IN WHOLE OR IN PART BY THE NEGLIGENCE (WHETHER SOLE, JOINT, CONCURRENT, COMPARATIVE, CONTRIBUTORY, ACTIVE, PASSIVE, OR OTHERWISE), STRICT LIABILITY, OR OTHER FAULT, OF ANY MEMBER OF MIDSTREAM CO GROUP OR THE PRODUCER GROUP, WITHOUT REGARD TO THE CAUSE OR CAUSES THEREOF AND WITHOUT LIMITATION OF SUCH LOSS AND WHETHER OR NOT CAUSED BY A PRE-EXISTING CONDITION.

 

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Section 15.2 Indemnification Regarding Third Parties . Each Party shall release, protect, defend, indemnify and hold the other Party harmless against any Loss by a Third Party that is not a member of the Producer Group or Midstream Co Group, to the extent such Loss (a) is caused by the negligence or willful misconduct of said indemnifying Party or such Party’s Group, or (b) in the case of Producer as indemnifying Party, results from claims by a Third Party of title, rights, or encumbrances in or to Product delivered by Producer to a Receipt Point.

Section 15.3 Penalties . Producer shall release, protect, defend, indemnify, and hold harmless Midstream Co from any Losses resulting from penalties imposed by a Downstream Facility in any transportation contracts or service agreements associated with, or related to, Producer’s owned or Controlled Product, including any penalties imposed pursuant to the Downstream Facility’s tariff.

Section 15.4 Insurance . Midstream Co and Producer shall (a) carry and maintain no less than the insurance coverage set forth in Exhibit   D , and (b) cause such insurance to be (i) the primary coverage without any right of contribution from any other insurance held by the other Party to the extent of the insured Party’s indemnification obligations hereunder, and (ii) written and endorsed to include waivers of all subrogation rights of the insurers against Midstream Co and its Group (in the case of Producer’s insurance) or Producer and its Group (in the case of Midstream Co’s insurance). Unless Producer is Original Producer, Producer shall also cause the insurance carried and maintained by it pursuant to this Section 15.4 to be endorsed to name Midstream Co and its Group as additional insureds or provide blanket additional insured status that covers Midstream Co and its Group as additional insureds, except in the case of worker’s compensation insurance. Any insurance provided by OpCo on behalf of Midstream Co that comports with this Section 15.4 shall be deemed to satisfy these requirements.

Article 16

Assignment

Section 16.1 Assignment of Rights and Obligations under this Agreement .

(a) Assignment . Except as specifically otherwise provided in this Agreement, no Party shall have the right to assign its rights and obligations under this Agreement (in whole or in part) to another Person except with the prior consent of Midstream Co (in the case of an assignment by Producer) or Producer (in the case of an assignment by Midstream Co), which consent may be withheld at such Party’s sole discretion. Notwithstanding the foregoing, Producer may assign its rights and obligations under this Agreement to any Person to whom Producer assigns or transfers an interest in any of the Dedicated Properties insofar as this Agreement relates to such Dedicated Properties without the consent of Midstream Co; provided that (A) such Person assumes in writing the obligations of Producer under this Agreement insofar as it relates to the portion of the Dedicated Properties so assigned or transferred, such writing shall take the form of an Agreement Addendum, executed by the applicable Midstream Co and the Producer Assignee (and others, if appropriate) and such writing shall be recorded in the real property records of the counties in which the Dedication Area is located, (B) such assignment is made subject to this Agreement, (C) if such assignment or transfer is made to an Affiliate of Producer, the Original Producer shall not be released from any of its obligations under this Agreement, and (D) if such transfer or assignment is to a Producer Assignee (a “ Third Party

 

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Assignment ”): (1) the Original Producer shall be released from its obligations under this Agreement with respect to the Dedicated Properties so assigned or transferred, (2) at least thirty (30) Days prior to the closing date of the Third Party Assignment (or, if the period between signing and closing is less than thirty (30) Days, as early as possible and in no event less than two Business Days prior to the closing of the Third Party Assignment), Producer shall cause the proposed Producer Assignee to deliver an updated Development Report to Midstream Co and (3) prior to or on the closing date of the Third Party Assignment, the Producer Assignee shall deliver to Midstream Co (x) a copy of the writing pursuant to which the Third Party Assignment is occurring, and (y) documentation of any Conflicting Dedication affecting any Product of the Producer Assignee that would otherwise be considered Dedicated Production.

(b) Notice; Binding Effect . Within 30 Days prior to the date of execution of a permitted assignment by Producer, Producer shall give Midstream Co notice of any assignment of this Agreement or Dedicated Properties. Midstream Co shall give Producer written notice of any assignment of this Agreement within 30 Days after the date of execution of such permitted assignment. This Agreement shall be binding upon and inure to the benefit of the respective permitted successors and assigns of the Parties. Any attempted assignment made without compliance with the provisions set forth in this Section 16.1 shall be null and void ab initio .

(c) Releases not Assignments . Any release of any of the Dedicated Properties from the Dedications pursuant to Section 2.4 shall not constitute an assignment or transfer of such Dedicated Properties for the purposes of this Article 16 .

Section 16.2 Pre-Approved Assignments .

(a) Each Party shall have the right without the prior consent of the others to (i) mortgage, pledge, encumber or otherwise impress a lien or security interest upon its rights and interest in and to this Agreement, and (ii) make a transfer pursuant to any security interest arrangement described in (i) above, including any judicial or non-judicial foreclosure and any assignment from the holder of such security interest to another Person.

(b) Original Producer (but not any subsequent Producer) may Transfer Dedicated Properties free of the terms, conditions and obligations of this Agreement in a Transfer:

(i) where such Transfer is an exchange of undeveloped Dedicated Properties (the “ Outbound Acreage ”) for properties of a Third Party located in the Dedication Area, which such properties become subject to the Dedications under this Agreement; provided that Producer shall reimburse Midstream Co in full for all actual costs and expenses incurred by Midstream Co to install, build, construct, or otherwise place into service infrastructure for the Outbound Acreage, so long as Midstream Co had informed Producer of its intention to install, build, construct or otherwise place into service the applicable infrastructure by inclusion of the same in a System Plan delivered prior to the closing of the applicable Transfer; or

(ii) where such Transfer (x) is not of the type described in Section 16.2(b)(i) , (y) pertains solely to Dedicated Properties outside of the boundary shown on Annex A to Midstream Addendum 07, and (z) would not cause the number of Net Acres of Dedicated

 

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Properties Transferred pursuant to this Section 16.2(b)(ii) during the Term of this Agreement, on an aggregate basis, to exceed 3,500 Net Acres. Original Producer shall be responsible for tracking the total acreage sold under this Section 16.2(b)(ii) and the number of Net Acres Transferred beginning on the Effective Date and continuing through the end of the Term and shall, upon request of Midstream Co, provide evidence supporting Original Producer’s calculation thereof.

Section 16.3 Change of Control . Except as provided in Section 16.1 , nothing in this Article 16 shall prevent Producer’s members or owners from transferring their respective interests (whether equity or otherwise and whether in whole or in part) in Producer and nothing in this Article 16 shall prevent Midstream Co’s members or owners from transferring their respective interests (whether equity or otherwise and whether in whole or in part) in Midstream Co. However, if a change of control of a Party gives rise to a reasonable basis for insecurity on the part of the other Party, such change of control may be the basis for a request of Adequate Assurance of Performance. Each member or owner of Producer or Midstream Co, as applicable, shall have the right to assign and transfer such member’s or owner’s interests (whether equity or otherwise and whether in whole or in part) in Producer or Midstream Co, as applicable, without restriction contained in this Agreement.

Article 17

Other Provisions

Section 17.1 Relationship of the Parties . The execution and delivery of an Agreement Addendum shall create a binding agreement between the Parties signatory thereto consisting of the terms set forth in such Agreement Addendum together with the terms set forth in these Agreement Terms and Conditions. The signatories of one Agreement Addendum shall not be bound to or otherwise in privity of contract with the signatories of any other Agreement Addendum, and the execution and delivery of each Agreement Addendum shall form a separate and distinct contract. This Agreement shall not be deemed or construed to create, a partnership, joint venture or association or a trust between Producer and Midstream Co or the persons party to any other Agreement Addendum. This Agreement shall not be deemed or construed to authorize any Party to act as an agent, servant or employee for any other Party for any purpose whatsoever except as explicitly set forth in this Agreement. In their relations with each other under this Agreement, the Parties shall not be considered fiduciaries.

Section 17.2 Notices . Unless otherwise specified in the applicable provision, all notices, consents, approvals, requests, and other communications required or permitted to be given under this Agreement shall be in writing and delivered personally, or sent by bonded overnight courier, mailed by U.S. Express Mail or by certified or registered United States Mail with all postage fully prepaid, return receipt requested, or, except in the case of notices of breach or default, sent by electronic mail (including with a PDF of the notice or other communication attached), in each case, addressed (i) if to Producer, at the address set forth on the applicable Agreement Addendum and (ii) if to Midstream Co, at the address set forth on the applicable Agreement Addendum; provided that in the case of any notice by electronic mail, such notice is confirmed by communication via another method permitted by this Section 17.2 . Any notice, consent, approval, request, or other communication (“ Communications ”) given in accordance herewith shall be deemed to have been given when (a) actually received or rejected by the

 

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addressee in person or by courier, (b) ( reserved ), or (c) actually received or rejected by the addressee upon delivery by overnight courier or United States Mail, as shown in the tracking report or return receipt, as applicable. Communications may not be transmitted by electronic mail, except for ordinary course business communications that shall be deemed to be received, if transmitted during normal business hours on such Business Day, or if transmitted after normal business hours, on the next Business Day. Any Person may change their contact information for notice by giving notice to the other Party in the manner provided in this Section 17.2 .

Section 17.3 Entire Agreement; Conflicts . This Agreement (consisting of these Agreement Terms and Conditions and the applicable Agreement Addendum) constitutes the entire agreement of Producer and Midstream Co pertaining to the subject matter hereof and supersedes all prior agreements, understandings, negotiations, and discussions, whether oral or written, of Producer and Midstream Co pertaining to the subject matter hereof. There are no warranties, representations, or other agreements between Producer and Midstream Co relating to the subject matter hereof except as specifically set forth in this Agreement, including the exhibits hereto, and no Party shall be bound by or liable for any alleged representation, promise, inducement, or statements of intention not so set forth.

Section 17.4 Waivers; Rights Cumulative . Any of the terms, covenants, or conditions hereof may be waived only by a written instrument executed by or on behalf of the Person waiving compliance. No course of dealing on the part of any Party, or their respective officers, employees, agents, or representatives, nor any failure by a Party to exercise any of its rights under this Agreement shall operate as a waiver thereof or affect in any way the right of such Party at a later time to enforce the performance of such provision. No waiver by any Party of any condition, or any breach of any term or covenant contained in this Agreement, in any one or more instances, shall be deemed to be or construed as a further or continuing waiver of any such condition or breach or a waiver of any other condition or of any breach of any other term or covenant. The rights of Produce and Midstream Co under this Agreement shall be cumulative, and the exercise or partial exercise of any such right shall not preclude the exercise of any other right.

Section 17.5 Amendment .

(a) This Agreement may be amended only by an instrument in writing executed (except as otherwise set forth in this Section 17.5 ) by Producer and Midstream Co and expressly identified as an amendment or modification.

(b) In the event of a conflict between (i) these Agreement Terms and Conditions or any exhibit to this agreement, on the one hand, and (ii) an applicable Agreement Addendum, on the other, the applicable Agreement Addendum shall control.

Section 17.6 Governing Law; Arbitration . This Agreement shall be governed by and construed in accordance with the laws of the State, excluding any conflicts of law rule or principle that might refer construction of such provisions to the laws of another jurisdiction. Any dispute, controversy, or claim arising out of or relating to this Agreement shall be finally settled by arbitration in accordance with the CPR Institute for Dispute Resolution Rules for Non-Administered Arbitration then in effect (the “ Rules ”) by a sole arbitrator appointed in accordance

 

Texas Crude Oil Gathering Agreement

- 49 -


with the Rules. The arbitrator is not empowered to award consequential, indirect, special, punitive or exemplary damages, and each Party irrevocably waives any damages in excess of actual damages. Arbitration shall be held in the English language in the State, and the decision of the arbitration panel shall include a statement of the reasons for such decision, and the award shall be final and binding on Producer and Midstream Co. Awards shall be final and binding on Producer and Midstream Co from the date they are made and judgment upon any award may be entered in any court having jurisdiction. The arbitrator shall apply the laws of the State, excluding any conflicts of law rule or principle that might refer construction of such provisions to the laws of another jurisdiction.

Section 17.7 Parties in Interest . Except for parties indemnified hereunder, nothing in this Agreement shall entitle any Person other than the Parties to any claim, cause of action, remedy or right of any kind.

Section 17.8 Preparation of Agreement . The Parties and their respective counsel participated in the preparation of this Agreement. In the event of any ambiguity in this Agreement, no presumption shall arise based on the identity of the draftsman of this Agreement.

Section 17.9 Severability . If any term or other provision of this Agreement is invalid, illegal, or incapable of being enforced by any rule of Law or public policy, all other conditions and provisions of this Agreement shall nevertheless remain in full force and effect so long as the economic or legal substance of the transactions contemplated hereby is not affected in any adverse manner to any Party. Upon such determination that any term or other provision is invalid, illegal, or incapable of being enforced, Producer and Midstream Co, as applicable, shall negotiate in good faith to modify this Agreement so as to effect the original intent of Producer and Midstream Co as closely as possible in an acceptable manner to the end that the transactions contemplated hereby are fulfilled to the extent possible. A ruling of invalidity, illegality or unenforceability as to one Agreement shall only be applicable to that Agreement, not all the Agreements covered by these Agreement Terms and Conditions.

Section 17.10 Counterparts . This Agreement may be executed in any number of counterparts, and each such counterpart hereof shall be deemed to be an original instrument, but all of such counterparts shall constitute for all purposes one agreement. Any signature hereto delivered by a Party by electronic mail shall be deemed an original signature hereto; provided that the originals of any such electronically provided signatures shall be provided by the signatory, if requested by the other Party within a week of exchanging signatures.

Section 17.11 Confidentiality . All data and information exchanged by the Parties (other than the terms and conditions of this Agreement) and all pricing terms shall be maintained in strict and absolute confidence and no Party shall disclose, without the prior consent of the other Parties, any such data, information or pricing terms unless the release thereof is required by Law (including any requirement associated with an elective filing with a Governmental Authority) or the rules or regulations of any stock exchange on which any securities of the Parties or any Affiliates thereof are traded. Nothing in this Agreement shall prohibit the Parties from disclosing whatever information in such manner as may be required by Applicable Law; nor shall any Party be prohibited by the terms hereof from disclosing information acquired under this Agreement to any financial institution or investors providing or proposing financing to a Party or

 

Texas Crude Oil Gathering Agreement

- 50 -


to any Person proposing to purchase the equity in any Party or the assets owned by any Party. Notwithstanding the foregoing, the restrictions in this Section 17.11 will not apply to data or information that (i) is in the possession of the Person receiving such information prior to disclosure by the other Party, (ii) is or becomes known to the public other than as a result of a breach of this Agreement or (iii) becomes available to a Party a non-confidential basis from a source other than the other Party, provided that such source is not bound by a confidentiality agreement with, or other fiduciary obligations of confidentiality to, the other Party. This Section will survive any termination of this Agreement for a period of 24 Months from the end of the Year in which the date of such termination occurred.

( End of Agreement Terms and Conditions )

 

Texas Crude Oil Gathering Agreement

- 51 -


EXHIBIT A

TO TEXAS AGREEMENT TERMS AND CONDITIONS

RELATING TO CRUDE OIL GATHERING SERVICES

Reserved

 

Texas Crude Oil Gathering Agreement

Exhibit A - 1


EXHIBIT B

TO TEXAS AGREEMENT TERMS AND CONDITIONS

RELATING TO CRUDE OIL GATHERING SERVICES

DOWNTIME FEE REDUCTION

 

Facility Segment Downtime Percentage (per Month)

   Percentage Reduction of
Individual Fee with respect to
such Facility Segment
 

Greater than 4.5% and up to and including 10%

     5

Greater than 10% and up to and including 12%

     10

Greater than 12% and up to and including 15%

     15

Greater than 15%

     20

(End of Exhibit B)

 

Texas Crude Oil Gathering Agreement

Exhibit B - 1


EXHIBIT C

TO TEXAS AGREEMENT TERMS AND CONDITIONS

RELATING TO CRUDE OIL GATHERING SERVICES

OPERATING PRESSURE FEE REDUCTION

 

Pressure Overage Percentage, based on pressures at a central facility on a Facility Segment

   Percentage Reduction of
Individual Fee with respect to
such Facility Segment
 

Less than 5%

     None   

Greater than 5% and up to and including 15%

     5

Greater than 15% and up to and including 25%

     10

Greater than 25% and up to and including 35%

     15

Greater than 35% and up to and including 45%

     20

Greater than 45%

     25

(End of Exhibit C)

 

Crude Oil Gathering Agreement

Exhibit C - 1


EXHIBIT D

TO TEXAS AGREEMENT TERMS AND CONDITIONS

RELATING TO OIL GATHERING SERVICES

INSURANCE

Midstream Co and Producer shall (or, in the case of Midstream Co, Midstream Co may cause OpCo to) purchase and maintain in full force and effect at all times during the Term of this Agreement, at such Party’s sole cost and expense and from insurance companies that are rated (or whose reinsurers are rated) “A-VII” or better by AM Best or “BBB-” or better by Standard & Poor’s or an equivalent rating from another recognized rating agency, policies providing the types and limits of insurance indicated below, which insurance shall be regarded as a minimum and, to the extent of the obligations undertaken by such Party in this Agreement, shall be primary (with the exception of the Excess Liability Insurance and Workers’ Compensation) as to any other existing, valid, and collectable insurance. Each Party’s deductibles shall be borne by that Party.

 

  A. Where applicable, Workers’ Compensation and Employers’ Liability Insurance, in accordance with the statutory requirements of the State, and endorsed specifically to include the following:

 

  1. Employers’ Liability, subject to a limit of liability of not less than $1,000,000 per accident, $1,000,000 for each employee/disease, and a $1,000,000 policy limit.

The Workers’ Compensation and Employers’ Liability Insurance policy(ies) shall contain an alternate employer endorsement.

 

  B. Commercial General Liability Insurance, with limits of liability of not less than the following:

$2,000,000 general aggregate

$1,000,000 each occurrence, Bodily Injury or Property Damage Combined Single Limit

Such insurance shall include the following:

 

  1. Premises and Operations coverage.

 

  2. Contractual Liability covering the liabilities assumed under this Agreement.

 

  3. Broad Form Property Damage Liability endorsement, unless policy is written on November 1988 or later ISO form.

 

  4. Products and Completed Operations.

 

  5. Time Element Limited Pollution coverage.

 

Crude Oil Gathering Agreement

Exhibit D - 1


  C. If applicable, Automobile Liability Insurance, with limits of liability of not less than the following:

$1,000,000 Bodily Injury or Property Damage Combined Single Limit, for each occurrence.

Such coverage shall include hired and non-owned vehicles and owned vehicles where applicable.

 

  D. If applicable, Aircraft Liability Insurance. In any operation requiring the use or charter of aircraft or helicopters by Midstream Co or Producer, combined single limit insurance shall be carried or cause to be carried for public liability, passenger liability and property damage liability in an amount of not less than $8,000,000 per seat subject to a minimum of $20,000,000; this insurance shall cover all owned and non-owned aircraft, including helicopters, used by Midstream Co in connection with the performance of the work set forth in this Agreement.

 

  E. Excess Liability Insurance, with limits of liability not less than the following:

Limits of Liability - $10,000,000 Occurrence/Aggregate for Bodily Injury and Property Damage in excess of the coverage outlined in Paragraphs A, B, C and D.

The limits of coverage required in this Agreement may be met with any combination of policies as long as the minimum required limits are met.

Each Party to this Agreement shall have the right to acquire, at its own expense, such additional insurance coverage as it desires to further protect itself against any risk or liability with respect to this Agreement and operations and activities under this Agreement or related thereto. All insurance maintained by or on behalf of Producer or Midstream Co shall contain a waiver by the insurance company of all rights of subrogation in favor of the other Party.

Neither the minimum policy limits of insurance required of the Parties nor the actual amounts of insurance maintained by the Parties under their insurance program shall operate to modify the Parties’ liability or indemnity obligations in this Agreement.

A Party may self-insure the requirements in this Exhibit   D if such Party is Controlled by Noble Energy, Inc. and, otherwise, if such Party or its parent is considered investment grade (S&P BBB- or equivalent or higher).

(End of Exhibit D)

 

Crude Oil Gathering Agreement

Exhibit D -2

Exhibit 10.36

TERMS IN THIS EXHIBIT HAVE BEEN REDACTED BECAUSE CONFIDENTIAL TREATMENT FOR THOSE TERMS HAS BEEN REQUESTED. THE REDACTED MATERIAL HAS BEEN FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION, AND THE TERMS HAVE BEEN MARKED AT THE APPROPRIATE PLACE WITH TWO BRACKETED ASTERISKS [**].

TEXAS OIL GATHERING AGREEMENT

AGREEMENT ADDENDUM 01

P ERMIAN

C ONTRACT N UMBER : BLPR01-OG

This AGREEMENT ADDENDUM 01 (this “ Agreement Addendum ”) (a) shall be effective as among the Persons named below as “Producer” and “Midstream Co” as of the date specified below as the “Effective Date,” (b) incorporates the Texas Agreement Terms and Conditions Relating to Crude Oil Gathering Services (the “ Agreement Terms and Conditions ”), which were last amended effective as of the Effective Date, and (c) together with the Agreement Terms and Conditions, shall constitute one contract and shall be the Agreement of the Parties. Except as otherwise set forth herein (i) all terms shall have the meanings assigned to such terms in the Agreement Terms and Conditions, and (ii) all references to Exhibits, Appendices, Articles, Sections, subsections and other subdivisions refer to the corresponding Exhibits, Appendices, Articles, Sections, subsections and other subdivisions of or to the Agreement Terms and Conditions.

Producer desires to contract with Midstream Co for Midstream Co to provide the Services utilizing the Individual System, and Midstream Co desires to provide the Services to Producer, on the terms and subject to the conditions of this Agreement.

NOW, THEREFORE, in consideration of the mutual agreements in this Agreement, Midstream Co and Producer hereby agree as follows:

 

Producer    Rosetta Resources Operating LP, a Delaware limited partnership
Midstream Co    Blanco River DevCo LP, a Delaware limited partnership
Parties    The term “Party” or “Parties” shall refer to Producer and Midstream Co identified in this Agreement Addendum
Effective Date    September 1, 2016

 

Agreement Addendum 01 – Page 1

Texas Crude Oil Gathering Agreement

Permian


TERMS IN THIS EXHIBIT HAVE BEEN REDACTED BECAUSE CONFIDENTIAL TREATMENT FOR THOSE TERMS HAS BEEN REQUESTED. THE REDACTED MATERIAL HAS BEEN FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION, AND THE TERMS HAVE BEEN MARKED AT THE APPROPRIATE PLACE WITH TWO BRACKETED ASTERISKS [**].

 

Dedication Area

  

The following areas within Reeves County, Texas:

 

H&GNRR Block 5

H&GNRR Block 6

H&GNRR Block 13

 

PSL Block C18

PSL Block C10

PSL Block C9

PSL Block C8

PSL Block C7

PSL Block C6

 

T&P RR Block 51-T7

T&P RR Block 50-T7

Individual Fee    $[**].

 

Agreement Addendum 01 – Page 2

Texas Crude Oil Gathering Agreement

Permian


TERMS IN THIS EXHIBIT HAVE BEEN REDACTED BECAUSE CONFIDENTIAL TREATMENT FOR THOSE TERMS HAS BEEN REQUESTED. THE REDACTED MATERIAL HAS BEEN FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION, AND THE TERMS HAVE BEEN MARKED AT THE APPROPRIATE PLACE WITH TWO BRACKETED ASTERISKS [**].

 

Notices and Payments

Notice Address – General Matters & Correspondence   

Midstream Co:

 

Midstream Co

c/o Noble Midstream Services, LLC

1001 Noble Energy Way

Houston, TX 77070

Attention:     Chief Financial Officer

     John F. Bookout, IV

Telephone:   (832) 639-7134

Email:          John.Bookout@nblenergy.com

 

Producer:

 

Rosetta Resources Operating LP

c/o Noble Energy, Inc.

1001 Noble Energy Way

Houston, TX 77070

Attention: John Nedelka, Director Revenue Accounting

Telephone: (281) 872-3120

Email: John.Nedelka@nblenergy.com

 

Agreement Addendum 01 – Page 3

Texas Crude Oil Gathering Agreement

Permian


TERMS IN THIS EXHIBIT HAVE BEEN REDACTED BECAUSE CONFIDENTIAL TREATMENT FOR THOSE TERMS HAS BEEN REQUESTED. THE REDACTED MATERIAL HAS BEEN FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION, AND THE TERMS HAVE BEEN MARKED AT THE APPROPRIATE PLACE WITH TWO BRACKETED ASTERISKS [**].

 

Notice Address – Operational Matters   

Midstream Co:

 

Midstream Co

c/o Noble Midstream Services, LLC

1001 Noble Energy Way

Houston, TX 77070

Attention:     Chief Operating Officer

     John C. Nicholson

Telephone:   (281) 876-6186

Email:          John.Nicholson@nblenergy.com

 

Producer:

 

Rosetta Resources Operating LP

c/o Noble Energy, Inc.

1001 Noble Energy Way

Houston, TX 77070

Attention: John Nedelka, Director Revenue Accounting

Telephone: (281) 872-3120

Email: John.Nedelka@nblenergy.com

 

Agreement Addendum 01 – Page 4

Texas Crude Oil Gathering Agreement

Permian


TERMS IN THIS EXHIBIT HAVE BEEN REDACTED BECAUSE CONFIDENTIAL TREATMENT FOR THOSE TERMS HAS BEEN REQUESTED. THE REDACTED MATERIAL HAS BEEN FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION, AND THE TERMS HAVE BEEN MARKED AT THE APPROPRIATE PLACE WITH TWO BRACKETED ASTERISKS [**].

 

Notice Address – Force Majeure and Marketing interruptions   

Midstream Co:

 

Midstream Co

c/o Noble Midstream Services, LLC

1001 Noble Energy Way

Houston, TX 77070

Attention:     Chief Operating Officer

     John C. Nicholson

Telephone:   (281) 876-6186

Email:          John.Nicholson@nblenergy.com

 

Producer:

 

Rosetta Resources Operating LP

c/o Noble Energy, Inc.

1001 Noble Energy Way

Houston, TX 77070

Attention: John Nedelka, Director Revenue Accounting

Telephone: (281) 872-3120

Email: John.Nedelka@nblenergy.com

Notice Address – Invoicing Matters   

Midstream Co:

 

Midstream Co

c/o Noble Midstream Services, LLC

1001 Noble Energy Way

Houston, TX 77070

Attention: Ian Dams

Telephone: (832) 639-7406

Email: ian.dams@nblenergy.com

 

Producer:

 

Rosetta Resources Operating LP

c/o Noble Energy, Inc.

1001 Noble Energy Way

Houston, TX 77070

Attention: John Nedelka, Director Revenue Accounting

Telephone: (281) 872-3120

Email: John.Nedelka@nblenergy.com

 

Agreement Addendum 01 – Page 5

Texas Crude Oil Gathering Agreement

Permian


TERMS IN THIS EXHIBIT HAVE BEEN REDACTED BECAUSE CONFIDENTIAL TREATMENT FOR THOSE TERMS HAS BEEN REQUESTED. THE REDACTED MATERIAL HAS BEEN FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION, AND THE TERMS HAVE BEEN MARKED AT THE APPROPRIATE PLACE WITH TWO BRACKETED ASTERISKS [**].

 

Payments by Electronic Funds Transfer   

Midstream Co:

 

ABA for wire: 021000021

ABA for ACH: 111000614

Account Number: 880285205

Account Name: Blanco River DevCo LP

Financial Institution: JP Morgan

Bank Swift: CHASUS33

 

Producer:

 

ABA/Routing Number: 021000021

Account Number: 700628402

Account Name: Rosetta Resources Operating LP

Financial Institution: JPMorgan Chase – New York

Bank Swift: CHASUS33

(End of Agreement Addendum 01)

 

Agreement Addendum 01 – Page 6

Texas Crude Oil Gathering Agreement

Permian


TERMS IN THIS EXHIBIT HAVE BEEN REDACTED BECAUSE CONFIDENTIAL TREATMENT FOR THOSE TERMS HAS BEEN REQUESTED. THE REDACTED MATERIAL HAS BEEN FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION, AND THE TERMS HAVE BEEN MARKED AT THE APPROPRIATE PLACE WITH TWO BRACKETED ASTERISKS [**].

 

IN WITNESS WHEREOF, the Parties hereto have executed this Agreement in duplicate originals to be effective as of the Effective Date.

 

“Producer”
ROSETTA RESOURCES OPERATING LP
  BY: ROSETTA RESOURCES OPERATING GP, LLC, its general partner
By:  

/s/ Charles J. Rimer

  Name:   Charles J. Rimer
  Title:   President

 

STATE OF COLORADO    )
   ) ss.
COUNTY OF DENVER    )

The foregoing instrument was acknowledged before me this 25th day of August 2016, by Charles J. Rimer as President of Rosetta Resources Operating GP, LLC, a Delaware limited liability company, acting as the general partner of Rosetta Resources Operating LP, a Delaware limited partnership.

WITNESS my hand and official seal.

 

My commission expires:   03/17/2018

 

/s/ Christine Usher

Notary Public

 

Agreement Addendum 01 – Signature Page 1

Texas Crude Oil Gathering Agreement

Permian


TERMS IN THIS EXHIBIT HAVE BEEN REDACTED BECAUSE CONFIDENTIAL TREATMENT FOR THOSE TERMS HAS BEEN REQUESTED. THE REDACTED MATERIAL HAS BEEN FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION, AND THE TERMS HAVE BEEN MARKED AT THE APPROPRIATE PLACE WITH TWO BRACKETED ASTERISKS [**].

 

 

“Midstream Co”
BLANCO RIVER DEVCO LP
  By: Blanco River DevCo GP LLC
   

By: Noble Midstream Services, LLC

      By:  

/s/ Terry R. Gerhart

        Terry R. Gerhart
        Chief Executive Officer

 

STATE OF TEXAS    )
   ) ss.
COUNTY OF HARRIS    )

The foregoing instrument was acknowledged before me this 25th day of August 2016, by Terry R. Gerhart as Chief Executive Officer of Noble Midstream Services, LLC, in its capacity as sole member of Blanco River DevCo GP LLC, in its capacity as the general partner of Blanco River DevCo LP, a Delaware limited partnership.

WITNESS my hand and official seal.

 

My commission expires:   05/05/2018

 

/s/ Joanne Garner

Notary Public

 

Agreement Addendum 01 – Signature Page 2

Texas Crude Oil Gathering Agreement

Permian

Exhibit 10.37

Execution Version

TEXAS PRODUCED WATER SERVICES AGREEMENT

consisting of the

TEXAS AGREEMENT TERMS AND CONDITIONS RELATING TO

PRODUCED WATER SERVICES

taken together with the applicable

TEXAS AGREEMENT ADDENDUM

now or in the future effective


TABLE OF CONTENTS

 

             PAGE  
ARTICLE 1 DEFINITIONS      1   
  Section 1.1   Definitions      1   
  Section 1.2   Other Terms      13   
  Section 1.3   References and Rules of Construction      13   
ARTICLE 2 PRODUCT DEDICATION AND REAL PROPERTY DEDICATION      14   
  Section 2.1   Producer’s Dedications      14   
  Section 2.2   Conflicting Dedications      14   
  Section 2.3   Producer’s Reservation      15   
  Section 2.4   Releases from Dedication      16   
  Section 2.5   Covenants Running with the Land      18   
  Section 2.6   Recording of Agreement      18   
ARTICLE 3 SYSTEM EXPANSION AND CONNECTION OF WELLS      18   
  Section 3.1   Development Report; System Plan; Meetings      18   
  Section 3.2   Expansion of System and Connection of Separator Facilities      22   
  Section 3.3   Temporary Services      23   
  Section 3.4   Cooperation      24   
  Section 3.5   Grant of Access; Real Property Rights      24   
ARTICLE 4 MEASUREMENT DEVICES      25   
  Section 4.1   Measurement Devices      25   
  Section 4.2   Measurement Procedures      27   
  Section 4.3   Product Meter Adjustments      28   
ARTICLE 5 TENDER, NOMINATION, AND GATHERING OF PRODUCTION      28   
  Section 5.1   Limitations on Service to Third Parties      28   
  Section 5.2   Tender of Dedicated Production      29   
  Section 5.3   Services; Service Standard      29   
  Section 5.4   Designation of Recycling or Disposal, Nominations, Scheduling, and Curtailment      30   
  Section 5.5   Suspension/Shutdown of Service      30   
ARTICLE 6 FEES      31   
  Section 6.1   Fees      31   
  Section 6.2   Fee Adjustments      31   
  Section 6.3   Treatment of Byproducts, System Gains/Losses, Fuel and Related Matters      33   

 

- i -

Texas Produced Water Services Agreement


ARTICLE 7 QUALITY SPECIFICATIONS    34  
  Section 7.1   Quality Specification      34   
  Section 7.2   Failure to Meet Specifications      34   
ARTICLE 8 TERM      35   
  Section 8.1   Term      35   
  Section 8.2   Effect of Termination or Expiration of the Term      35   
ARTICLE 9 TITLE AND CUSTODY      36   
  Section 9.1   Title      36   
  Section 9.2   Custody      36   
ARTICLE 10 BILLING AND PAYMENT      36   
  Section 10.1   Statements      36   
  Section 10.2   Payments      37   
  Section 10.3   Adequate Assurances      37   
  Section 10.4   Audit      38   
ARTICLE 11 REMEDIES      38   
  Section 11.1   Suspension of Performance; Temporary Release from Dedication      38   
  Section 11.2   No Election      39   
  Section 11.3   DIRECT DAMAGES      39   
ARTICLE 12 FORCE MAJEURE      40   
  Section 12.1   Force Majeure      40   
  Section 12.2   Extension Due to Force Majeure      40   
ARTICLE 13 CHANGE IN LAW; UNECONOMIC SERVICE      40   
  Section 13.1   Changes in Applicable Law      40   
  Section 13.2   Unprofitable Operations and Rights of Termination      41   
ARTICLE 14 RESERVED      43   
ARTICLE 15 INDEMNIFICATION AND INSURANCE      43   
  Section 15.1   Reciprocal Indemnity      43   
  Section 15.2   Indemnification Regarding Third Parties      43   
  Section 15.3   Penalties      44   
  Section 15.4   Insurance      44   
  ARTICLE 16 ASSIGNMENT      44   

 

- ii -

Texas Produced Water Services Agreement


  Section 16.1   Assignment of Rights and Obligations under this Agreement      44   
  Section 16.2   Pre-Approved Assignments      45   
  Section 16.3   Change of Control      45   
ARTICLE 17 OTHER PROVISIONS      46   
  Section 17.1   Relationship of the Parties      46   
  Section 17.2   Notices      46   
  Section 17.3   Entire Agreement; Conflicts      47   
  Section 17.4   Waivers; Rights Cumulative      47   
  Section 17.5   Amendment      47   
  Section 17.6   Governing Law; Arbitration      47   
  Section 17.7   Parties in Interest      48   
  Section 17.8   Preparation of Agreement      48   
  Section 17.9   Severability      48   
  Section 17.10   Counterparts      48   
  Section 17.11   Confidentiality      48   
ARTICLE 18 PIPELINE UNAVAILABILITY      49   
EXHIBIT A TO TEXAS AGREEMENT TERMS AND CONDITIONS      1   
RELATING TO PRODUCED WATER SERVICES      1   
EXHIBIT B      1   
EXHIBIT C TO TEXAS AGREEMENT TERMS AND CONDITIONS RELATING TO PRODUCED WATER SERVICES      1   
EXHIBIT D TO TEXAS AGREEMENT TERMS AND CONDITIONS RELATING TO PRODUCED WATER SERVICES      1   

EXHIBITS

EXHIBIT A    RESERVED
EXHIBIT B    DOWNTIME FEE REDUCTION
EXHIBIT C    RESERVED
EXHIBIT D    INSURANCE

 

- iii -

Texas Produced Water Services Agreement


TEXAS AGREEMENT TERMS AND CONDITIONS RELATING TO

PRODUCED WATER SERVICES

These TEXAS AGREEMENT TERMS AND CONDITIONS RELATING TO PRODUCED WATER SERVICES (these “ Agreement Terms and Conditions ”) (i) shall be effective with respect to each signatory of each Agreement Addendum as of the Effective Date specified in the applicable Agreement Addendum (defined below), (ii) were last updated as of the Effective Date, (iii) are incorporated into and made a part of each Agreement Addendum, and (iv) taken together with the applicable Agreement Addendum shall constitute one Agreement, separate and apart from any other Agreement governed by these Agreement Terms and Conditions.

Recitals:

 

  A. Producer owns rights, title and interests in certain oil and gas leases and other interests located within the Dedication Area (defined below) that require services related to the Product (defined below).

 

  B. Producer wishes to obtain such services from each Midstream Co (defined below) that executes and delivers an Agreement Addendum (defined below) pursuant to these Agreement Terms and Conditions, as modified by the applicable Agreement Addendum.

 

  C. Producer desires to dedicate all produced water it Controls (defined below) that is attributable to its right, title, and interest in certain oil and gas leases and other interests located within the Dedication Area (defined below) to the Individual System (defined below).

 

  D. Each Midstream Co that executes and delivers an Agreement Addendum owns and operates an Individual System that gathers Product that is produced together with Producer’s Crude Oil produced from certain oil and gas leases and other interests.

Agreements:

NOW, THEREFORE, in consideration of the foregoing Recitals, which are incorporated herein, the mutual agreements in this Agreement, and other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, Midstream Co, and Producer hereby agree as follows:

Article 1

Definitions

Section 1.1 Definitions . As used in this Agreement, the following capitalized terms shall have the meanings ascribed to them below:

Abandonment Date ” has the meaning given to it in Section 3.2(d) .

 

- 1 -

Texas Produced Water Services Agreement


Additional/Accelerated Well ” has the meaning given to it in Section 3.2(c) .

Adequate Assurance of Performance ” has the meaning given to it in Section 10.3 .

Adjustment Year ” has the meaning given to it in Section 6.2(a)(ii) .

Affiliate ” means, with respect to any Person, any other Person that directly, or indirectly through one or more intermediaries, Controls, or is Controlled by, or is under common Control with, such Person. The following sentence shall not apply to the term “Affiliate” as used in Section 2.2(b) or the definition of “Conflicting Dedication”: Producer and its subsidiaries (other than OpCo and its subsidiaries), on the one hand, and OpCo and its subsidiaries, on the other, shall not be considered Affiliates of each other for purposes of this Agreement.

Agreement ” means the applicable Agreement Addendum taken together with these Agreement Terms and Conditions, as modified by such Agreement Addendum.

Agreement Addendum ” means each Agreement Addendum by and between a Producer and a Midstream Co that expressly states that it is governed by these Agreement Terms and Conditions. “ Agreement Addenda ” shall be the collective reference to each Agreement Addendum then in effect.

Agreement Terms and Conditions ” has the meaning given to it in the introductory paragraph.

Applicable Month ” has the meaning set forth in Section 6.2(c) .

Approved SWD Vendor ” means Midstream Co or a Third Party, in either case, as mutually agreed in writing by the Parties; provided, however, that if an Approved SWD Vendor rejects any Product delivered to a SWD Trucking Facility for quality or safety reasons, then Midstream Co shall be entitled to select an alternative vendor to take title to, store, handle, and dispose of such Product without obtaining Producer’s approval of such vendor, and such vendor shall be deemed an Approved SWD Vendor for such purpose.

Associated Water ” means water that is produced with Crude Oil owned or Controlled by Producer and delivered with such Crude Oil to the Crude Oil Gathering System, which will be separated prior to redelivery of such Crude Oil to Producer. Following separation from Crude Oil and delivery into the System, such water shall cease to be Associated Water and shall be deemed Product.

Barrel ” means a quantity consisting of forty-two Gallons.

Beneficiary ” has the meaning given to it in Section 4.1(g) .

Business Day ” means a Day (other than a Saturday or Sunday) on which federal reserve banks are open for business.

Cancellation Date ” has the meaning given to it in Section 3.1(c) .

 

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Texas Produced Water Services Agreement


Claiming Party ” has the meaning given to it in the definition of “Force Majeure”.

Communications ” has the meaning given to it in Section 17.2 .

Conditional Amount ” has the meaning set forth in Section 10.1(a) .

Conflicting Dedication ” means any gathering agreement, commitment, or arrangement (including any volume commitment) that requires (a) Producer’s owned or Controlled Product to be trucked from or sold to a Third Party at the lease or to be gathered on any gathering system or similar system other than the System, including any such agreement, commitment, or arrangement burdening properties hereinafter acquired by Producer in the Dedication Area or (b) Producer to utilize a Third Party for any other Services covered by this Agreement. No dedication of acreage shall constitute a Conflicting Dedication if Producer’s requirement under such dedication is to deliver Product from a Delivery Point hereunder. A right of first refusal in favor of an entity other than Original Producer, OpCo, or any of their Affiliates shall be deemed to be a “Conflicting Dedication” if Affiliates of Original Producer are prohibited from providing Services pursuant to the applicable agreement creating such right of first refusal.

Control ” (including the term “ Controlled ”) means (a) with respect to any Person, the possession, direct or indirect, of the power to direct or cause the direction of the management and policies of a Person, whether through the ownership of voting shares, by contract, or otherwise and (b) with respect to any Product, such Product produced from the Dedication Area and owned by a Third Party or an Affiliate and with respect to which Producer has the contractual right or obligation (pursuant to a marketing, agency, operating, unit, or similar agreement) to dispose of such Product and Producer elects or is obligated to dispose of such Product on behalf of the applicable Third Party or Affiliate.

Credit-Worthy Person ” means a Person with a senior unsecured and credit-unenhanced long term debt rating equivalent to A- or better as determined by at least two rating agencies, one of which must be either Standard & Poor’s or Moody’s (or if either one or both are not available, equivalent ratings from alternate rating sources reasonably acceptable to Midstream Co).

Crude Oil ” means crude oil produced from oil or gas wells in the Dedication Area and Controlled by Producer, in its natural form, which may include Associated Water naturally produced therewith.

Crude Oil Gathering System ” means the Crude Oil gathering system used to provide Crude Oil gathering services to Producer.

Day ” means a period of time from 7:00 a.m. Central Time on a calendar day until 7:00 a.m. Central Time on the succeeding calendar day. The term “ Daily ” shall have the correlative meaning.

Dedicated Production ” means (a) Product owned by Producer or an Affiliate of Producer and produced from a Well within the Dedication Area that is operated by Producer or an Affiliate under the Control of Producer, (b)  Reserved , and (c) Product produced within the Dedication Area that is owned by a Third Party and under the Control of Producer. Notwithstanding the foregoing, (i) any Product that was released pursuant to the Releases of Dedication shall not be

 

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Texas Produced Water Services Agreement


included in this definition of “Dedicated Production”, (ii) any Product that is permanently released pursuant to Section 2.4(a) or otherwise shall cease to be included in this definition of “Dedicated Production” immediately upon the effectiveness of such permanent release, and (iii) in the event of an assignment by a Producer (“X”) to an assignee (“Y”) that is permitted under Article 16 , any Product that is so assigned shall cease to be included in X’s Dedicated Production and shall solely be included in Y’s Dedicated Production as of the effective date of such assignment.

Dedicated Properties ” means the interests held by Producer or its Affiliates in the oil and gas leases, mineral interests, and other similar interests as of the Effective Date or acquired by Producer or its Affiliates after the Effective Date that relate to land within the Dedication Area. Notwithstanding the foregoing, (a) any interest that was released pursuant to the Releases of Dedication shall not be included in this definition of “Dedicated Properties”, (b) any interest that is permanently released pursuant to Section 2.4(a) or otherwise, shall cease to be included in this definition of “Dedicated Properties” immediately upon the effectiveness of such permanent release and (c) in the event of an assignment by a Producer (“X”) to an assignee (“Y”) that is permitted under Article 16 , any interest that is so assigned shall cease to be included in X’s Dedicated Properties and shall solely be included in Y’s Dedicated Properties as of the effective date of such assignment.

Dedications ” means the Product Dedication and the Real Property Dedication together, and “ Dedication ” means the Product Dedication or the Real Property Dedication, as applicable.

Dedication Area ” means, with respect to this Agreement, the area described on the applicable Agreement Addendum. Notwithstanding the foregoing, (a) any acreage that was released pursuant to the Releases of Dedication shall not be included in this definition of “Dedication Area”, (b) any acreage that is permanently released pursuant to Section 2.4(a) or otherwise shall cease to be included in this definition of “Dedication Area” immediately upon the effectiveness of such permanent release and (c) in the event of an assignment by a Producer (“X”) to an assignee (“Y”) that is permitted under Article 16 , any acreage that is so assigned shall cease to be included in X’s Dedication Area and shall solely be included in Y’s Dedication Area as of the effective date of such assignment.

Delivery Point ” means the point at which custody transfers from Midstream Co to or for the account of Producer. The custody transfer point may include (a) the facilities of a Downstream Facility, (b) trucks or (c) any other point as may be mutually agreed between the Parties. The Delivery Points for each Individual System in existence on the Effective Date shall be set forth in writing between Producer and Midstream Co, and additional points may become Delivery Points hereunder upon mutual agreement of the Parties as construction is completed on additional facilities in satisfaction of the needs identified by Producer and the Parties shall continuously update the list of Delivery Points by mutual agreement.

Development Report ” has the meaning given to it in Section 3.1(a) .

Downstream Facility ” means the disposal system into which Product is delivered at a Delivery Point or, with respect to Product that is cleaned, treated or otherwise recycled hereunder, any storage facility or pipeline, in either case, downstream of the applicable Delivery Point.

 

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Texas Produced Water Services Agreement


Downtime Event ” means, with respect to any Facility Segment, or, as applicable, all of the Facilities Segments of an Individual System, a period during which Midstream Co is unable to receive Product into the central facility of such Facility Segment for a reason other than (i) Force Majeure, (ii) an event or condition downstream of the Individual System of which such Facility Segment is a part that was not caused by Midstream Co, (iii) planned maintenance for which Midstream Co provided notice as described in Section 5.5(b)(ii) , or (iv) Producer’s production exceeding the production forecast in the Development Report on which the applicable Facility Segment was based.

Downtime Hours ” means, with respect to any Facility Segment, the hours during the Applicable Month during which such Facility Segment was unavailable to provide Services.

Downtime Percentage ” means, with respect to any Facility Segment during the Applicable Month, an amount equal to the quotient of (a) the aggregate number of Downtime Hours during the Applicable Month, divided by (b) the total hours during the Applicable Month.

Effective Date ” has the meaning given to it in the applicable Agreement Addendum.

Escalation Percentage ” means 2.50%.

Excluded Amounts ” means Midstream Co’s general and administrative costs and any costs for design or construction of facilities that can be used to connect other Planned Wells or Planned Separator Facilities in the Development Report that Producer at such time intends to develop.

Facility Segment ” means each segment of an Individual System comprised of facilities beginning at a Receipt Point and ending at an Internal Transfer Point. If an Individual System does not contain any such distinct segment, then the term Facility Segment shall be synonymous with Individual System.

First Development Report ” means the first report delivered by Original Producer to Midstream Co that satisfies the requirements for a Development Report in Section 3.1(a) and Section 3.1(b) (an “ Original Report ”); and in the event that Producer assigns all or any part of the Dedicated Properties to a Producer Assignee, then with respect to such Producer Assignee, the First Development Report shall not refer to the Original Report but rather to the first Development Report delivered by such Producer Assignee to Midstream Co that satisfies the requirements for such report in Section 3.1(a) and Section 3.1(b) .

Force Majeure ” means an event that is not within the reasonable control of the Party claiming suspension (the “ Claiming Party ”), and that by the exercise of reasonable due diligence the Claiming Party is unable to avoid or overcome in a reasonable manner. To the extent meeting the foregoing requirements, Force Majeure includes: (a) acts of God; (b) wars (declared or undeclared); (c) insurrections, hostilities, riots; (d) floods, droughts, fires, storms, storm warnings, landslides, lightning, earthquakes, washouts; (e) industrial disturbances, acts of a public enemy, acts of terror, sabotage, blockades, epidemics; (f) arrests and restraints of rulers

 

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Texas Produced Water Services Agreement


and peoples; (g) civil disturbances; (h) explosions, breakage or accidents to machinery or lines of pipe; (i) hydrate obstruction or blockages of any kind in lines of pipe; (j) freezing of wells or delivery facilities, partial or entire failure of wells, and other events beyond the reasonable control of the Claiming Party that affect the timing of production or production levels; (k) ( reserved ); (l) action or restraint by any Governmental Authority (so long as the Claiming Party has not applied for or assisted in the application for, and has opposed where and to the extent commercially reasonable, such action or restraint), (m) delays or failures by a Governmental Authority to grant Permits applicable to the System (or any Individual System) so long as the Claiming Party has used its commercially reasonable efforts to make any required filings with such Governmental Authority relating to such Permits, and (n) delays or failures by the Claiming Party to obtain easements and rights of way, surface leases and other real property interests related to the System (or any Individual System) from Third Parties, so long as the Claiming Party has used its commercially reasonable efforts to obtain such easements and rights of way, surface leases and other real property interests. The failure of a Claiming Party to settle or prevent a strike or other labor dispute with employees shall not be considered to be a matter within such Claiming Party’s control.

Gallon ” means one U.S. Standard gallon measured at 60 degrees Fahrenheit.

Governmental Authority ” means any federal, state, local, municipal, tribal or other government; any governmental, regulatory (including self-regulatory) or administrative agency, commission, body or other authority exercising or entitled to exercise any administrative, executive, judicial, legislative, regulatory or taxing authority or power; and any court or governmental tribunal, including any tribal authority having or asserting jurisdiction.

Group ” means (a) with respect to Midstream Co, the Midstream Co Group, and (b) with respect to Producer, the Producer Group.

Increase in Fee ” has the meaning given to it in Section 6.2(b) .

Individual Disposal by Truck Fee ” means the Monthly fee for providing Trucked Water Services with respect to Dedicated Production delivered to a SWD Trucking Facility, as set forth opposite the heading “Individual Disposal by Truck Fee” on the applicable Agreement Addendum; provided that the Individual Disposal by Truck Fee shall accrue only with respect to Dedicated Production delivered by truck to a SWD Trucking Facility.

Individual Fee ” means the aggregate of the Individual First Phase Fee, the Individual Second Phase Fee and the Individual Disposal by Truck Fee; provided that for purposes of the annual escalation in the Individual Fee described in Section 6.2(b) , such term shall not include any Reimbursed Amount.

Individual First Phase Fee ” means the fee calculated as described in Section 6.1(i) .

Individual First Phase Rate ” means the Monthly rate for providing Services (other than the Second Phase Services) at a particular Individual System set forth on the applicable Agreement Addendum.

 

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Texas Produced Water Services Agreement


Individual Second Phase Fee ” means the Monthly fee for providing Second Phase Services at a particular Individual System, as set forth opposite the heading “Individual Second Phase Fee” on the applicable Agreement Addendum; provided that the Individual Second Phase Fee shall accrue only with respect to Services performed by Midstream Co on Product flowing through an Individual System.

Individual System ” means the portion of the System beginning at the Receipt Points and ending at the Delivery Points. The Individual Systems in existence on the Effective Date are more particularly described in writing between Producer and Midstream Co. Additional Individual Systems may be added to the System from time to time in satisfaction of the needs identified by Producer and evidenced in writing between Producer and Midstream Co.

Initial Term ” has the meaning given to it in Section 8.1 .

Interest Rate ” means, on the applicable date of determination, the prime rate (as published in the “Money Rates” table of The Wall Street Journal , eastern edition, or if such rate is no longer published in such publication or such publication ceases to be published, then as published in a similar national business publication as mutually agreed by the Parties) plus an additional two percentage points (or, if such rate is contrary to any applicable Law, the maximum rate permitted by such applicable Law).

Internal Transfer Point ” means the point at which custody transfers from Midstream Co to a Third Party contractor for the provision of Second Phase Services. The Internal Transfer Points for each Individual System in existence on the Effective Date shall be set forth in writing between Producer and Midstream Co, and additional points may become Internal Transfer Points hereunder by mutual agreement of the Parties.

Interruption Conditions ” has the meaning given to it in Section 2.4(b) .

Invoice Month ” has the meaning given to it in Section 10.1(a) .

Law ” means any applicable statute, law, rule, regulation, ordinance, order, code, ruling, writ, injunction, decree or other official act of or by any Governmental Authority.

Losses ” means any actions, claims, causes of action (including actions in rem or in personam), settlements, judgments, demands, liens, encumbrances, losses, damages, fines, penalties, interest, costs, liabilities, expenses (including expenses attributable to the defense of any actions or claims and attorneys’ fees) of any kind or character, including Losses for bodily injury, death, or property damage, whether under judicial proceedings, administrative proceedings or otherwise, and under any theory of tort, contract, breach of contract, breach of representation or warranty (express or implied) or by reason of the conditions of the premises of or attributable to any Person or Person or any Party or Parties.

Measurement Device ” means the lease automatic custody transfer, coriolis, or other metering device or equipment which, along with application of test results (e.g. meter proves, etc.), as required for the Individual System, measure the amount of oil, water, and basic sediment and water, all of which shall conform to industry standards and government regulations, as further described in Article 4 .

 

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Texas Produced Water Services Agreement


Measurement Point ” means the Measurement Device that the Parties have agreed in writing will measure the volume of Product moving through the Individual System.

Meetings of Senior Management ” means meetings between senior members of management of Midstream Co and Producer, or, if applicable, senior members of management of an Affiliate of Midstream Co or Producer, respectively, that Controls such entity.

Midstream Co ” means the Original Midstream Co, together with its permitted successors and assigns, including any Midstream Co Assignee.

Midstream Co Assignee ” means any Third Party to whom Midstream Co assigns its rights and obligations in accordance with this Agreement.

Midstream Co Group ” means Midstream Co, its Affiliates, and the directors, officers, employees, and agents, of Midstream Co and its Affiliates; provided that all subsidiaries of OpCo that do not hold equity in Midstream Co shall be excluded from this definition.

Modifications ” has the meaning given to it in Section 3.1(c) .

Month ” means a period of time from 7:00 a.m. Central Time on the first Day of a calendar month until 7:00 a.m. Central Time on the first Day of the next succeeding calendar month. The term “ Monthly ” shall have the correlative meaning.

Monthly Loss/ Gain Report ” means, with respect to any Invoice Month, the report delivered pursuant to Section 10.1(d) , which shall include statements of the following with respect to such Invoice Month: (a) the System Gains/Losses, (b) the Other System Fuel used by Midstream Co in the operation of the Individual System, and (c) the Recovered Oil recovered by Midstream Co and returned to Producer. With respect to any allocated volumes described in clause (c), the information included shall be of sufficient detail such that Producer may verify that the allocation procedures then in effect for the applicable Invoice Month were applied.

Moody’s ” means Moody’s Investors Service, Inc., or any successor to its statistical rating business.

Net Acres ” means (a) with respect to any oil and gas lease in which Producer has an interest, (i) the number of gross acres in the lands covered by such oil and gas lease, multiplied by (ii) the undivided percentage interest in oil, gas and other minerals covered by such oil and gas lease, multiplied by (iii) Producer’s working interest in such oil and gas lease, and (b) with respect to any mineral fee interest of Producer, (i) the number of gross acres in the lands covered by such mineral fee interest, multiplied by (ii) the undivided percentage interest of Producer in oil, gas and other minerals in such lands.

On-Line Deadline ” has the meaning given to it in Section 3.2(b) .

OpCo ” means Noble Midstream Services, LLC, together with its permitted successors and assigns.

Operating Hours ” has the meaning set forth in Section 6.2(c) .

 

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Texas Produced Water Services Agreement


Original Midstream Co ” means the entity identified as the “Midstream Co” in the applicable Agreement Addendum as of the Effective Date.

Original Producer ” means Rosetta Resources Operating LP, a Delaware limited partnership.

Original Report ” has the meaning set forth in the definition of “First Development Report.”

Other System Fuel ” means any natural gas delivered into Midstream Co’s custody by Producer pursuant to a Transaction Document between Producer and Midstream Co and measured and used as fuel by Midstream Co.

Outbound Acreage ” has the meaning given to it in Section 16.2(b)(i) .

Owner ” has the meaning given to it in Section 4.1(g) .

Party ” or “ Parties ” with respect to each Agreement Addendum shall mean the applicable Producer and the applicable Midstream Co. Unless expressly stated otherwise, references to “Parties” shall not refer to all parties to all Agreements governed hereby. Rather, references to “Parties” shall refer only to such Parties as determined by the applicable Agreement Addendum.

Period of Five Years ” means, with respect to any report delivered hereunder, the period from the first Day of the fiscal quarter during which such report is required to be delivered until the fifth anniversary thereof.

Period of Two Years ” means, with respect to any report delivered hereunder, the period beginning on the first Day of the fiscal quarter during which such report is required to be delivered and ending 24 Months after such date.

Permits ” means any permit, license, approval, or consent from a Governmental Authority.

Person ” means any individual, corporation, company, partnership, limited partnership, limited liability company, trust, estate, Governmental Authority, or any other entity.

Pipeline Unavailability ” means any time after the Trucked Water Services Commencement Date during which the Individual System is not capable of accepting or transporting volumes of Product for any reason, including Pre-Connection Water that exceeds the capacity of the Individual System, Pre-Connection Water at a time when the Individual System is not yet online, curtailments on the Individual System and interruptions of Service.

Planned Separator Facility ” has the meaning given to it in Section 3.1(b) .

Planned Well ” has the meaning given to it in Section 3.1(b) .

Pre-Connection Water ” means the water-based solution that flows back to the surface during and after the completion of hydraulic fracturing a Well.

 

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Texas Produced Water Services Agreement


Pre-Connection Period ” means, with respect to a Well, the period of time commencing on the Day Pre-Connection Water begins to return to the surface and ending on the earlier of the date (a) on which such Well or the Separator Facility to which such Well is connected is connected to the Individual System or (b) that is 10 Days following the first Day of the applicable Pre-Connection Period.

Producer ” means the Original Producer, together with its permitted successors and assigns, including any Producer Assignee.

Producer Assignee ” means any Person to whom Original Producer or any subsequent Producer sells, assigns, or otherwise transfers acreage subject to the Dedications.

Producer Group ” means Producer, its Affiliates, and the directors, officers, employees, and agents of Producer and its Affiliates.

Producer Meters ” means any Measurement Device owned and operated by Producer (or caused to be installed or operated by Producer).

Product ” means water that originates in the geologic formations and is produced as a byproduct of Producer’s development and operation of the Wells that are located in the Dedication Area, including Pre-Connection Water and any Recovered Oil; provided that any water that is Associated Water shall not constitute Product hereunder until such time as it has been separated from Crude Oil and ceases being Associated Water. The term “Product” as used in this Agreement shall refer to all water that is in the Individual System from Receipt Point to Delivery Point, whether such water is in the form of saltwater or water that has completed the recycling and treating processes. In the event Producer exercises its Trucking Election, the term “Product” shall refer to all water that is accepted for delivery at a SWD Trucking Facility for the account of Midstream Co.

Product Dedication ” means the dedication and commitment made by Producer pursuant to Section 2.1(a) .

Real Property Dedication ” means the dedication and commitment made by Producer pursuant to the first sentence in Section 2.1(b) .

Receipt Point ” means the point at which custody transfers from Producer to Midstream Co. The custody transfer point may include: (a) each of the connecting flanges through which Product travels after it has been separated from crude oil on the System located at or near the applicable Separator Facility, which flanges connect such Separator Facility to the System, (b) with respect to water that is separated from crude oil at a point in the System other than the Separator Facility, the point at which such Product is delivered into the System or (c) any other point as may be mutually agreed between the Parties. The Receipt Points in existence on the Effective Date shall be set forth in writing between Producer and Midstream Co, and additional points may become Receipt Points hereunder upon mutual agreement of the Parties as construction is completed on additional facilities in satisfaction of the needs identified by Producer and the Parties shall continuously update the list of Receipt Points by mutual agreement.

 

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Texas Produced Water Services Agreement


Recovered Oil ” means that portion of Crude Oil recovered by Midstream Co from Product received into the System. If at any time Midstream Co is not providing gathering services to Producer in the Dedication Area with respect to Crude Oil there will be no Recovered Oil delivered into the Crude Oil Gathering System.

Redetermination Deadline ” has the meaning given to it in Section 6.2(a)(ii) .

Redetermination Proposal ” has the meaning given to it in Section 6.2(a)(i) .

Redetermined Individual Fee ” has the meaning given to it in Section 6.2(a)(i) .

Reimbursed Amount ” has the meaning given to it in Section 10.1(a) .

Release Conditions ” has the meaning given to it in Section 2.4(a) .

Releases of Dedication ” is not applicable to Original Producer. For purposes of this Agreement there have been no Releases of Dedication.

Rules ” has the meaning given to it in Section 17.6 .

Second Phase Services ” has the meaning set forth in the definition of “Services”.

Separator Facility ” means the surface facility where the Crude Oil produced from one or more Wells in the Dedication Area is collected and gas and Product is separated from the Crude Oil. A Separator Facility may be known by the Original Producer as an econode but may also refer to a well pad or other facility from which Product is delivered into the System.

Services ” means: (a) the receipt of Producer’s owned or Controlled Product at the Receipt Points (including Recovered Oil as set forth in the approved System Plan); (b) the collection and gathering of such Product; (c) the storage of Product; (d) the cleaning of Product; (e) the removal of the Recovered Oil from the Product prior to the delivery of Product to the applicable Internal Transfer Point; (f) the delivery of Recovered Oil into the Crude Oil Gathering System at an appropriate Delivery Point; (g) the delivery of the Product to the applicable Internal Transfer Point; (h) the further cleaning, transportation from the applicable Internal Transfer Point to the applicable Delivery Point, and disposal of Product, as applicable (this clause (h), the “ Second Phase Services ”), (i) Trucked Water Services and (j) the other services to be performed by Midstream Co in respect of such Product as set forth in this Agreement and the System Plan for an Individual System, all in accordance with the terms of this Agreement (including any services with respect to metering services).

Services Fee ” means, collectively, the fees described in Section 6.1 .

Spacing Unit ” means the area fixed for the drilling of one Well by order or rule of any applicable Governmental Authority, or (if no such order or rule is applicable) the area fixed for the drilling of a Well or Planned Well reasonably established by the pattern of drilling in the applicable area or otherwise established by Producer in its reasonable discretion.

 

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Texas Produced Water Services Agreement


Standard & Poor’s ” means Standard & Poor’s Rating Group, a division of McGraw Hill, Inc., or any successor to its statistical rating business.

State ” means the state in which the Individual System is located.

SWD Trucking Facility ” means an Approved SWD Vendor’s saltwater disposal well that Midstream Co has designated for disposal of Dedicated Production that is transported by truck.

System ” means all Individual Systems described in all of the Agreement Addenda, collectively, including: (a) pipelines; (b) central processing facilities inclusive of pumping, treating and other equipment; (c) controls; (d) Delivery Points, meters and measurement facilities; (e) storage for Product; (f) easements, licenses, rights of way, fee parcels, surface rights and Permits; (g) pumping facilities, if any and (h) all appurtenant facilities, in each case, that are owned, leased, contracted or operated by each Midstream Co to provide Services to Producer or Third Parties, as such gathering system and facilities are modified or extended from time to time to provide Services to Producer pursuant to the terms hereof or to Third Parties, including the Facility Segments specified in the Agreement Addenda.

System Gains/Losses ” means any Product, in terms of Barrels, received into the Individual System that is lost, gained, or otherwise not accounted for.

System Plan ” has the meaning given to it in Section 3.1(c) .

Target On-Line Date ” means (a) with respect to a Planned Separator Facility or, with respect to a Planned Well that is not intended to be serviced by a Separator Facility, such Planned Well, in either case, that is described for the first time in the Original Report, the date specified in the Original Report for the applicable Planned Separator Facility or Planned Well, as applicable, (b) with respect to any Planned Separator Facility or, with respect to any Planned Well that is not intended to be serviced by a Separator Facility, such Planned Well, in either case, that is described in a First Development Report that is not the Original Report, 18 Months after the date of such First Development Report, unless Midstream Co consents to a shorter time period, and (c) with respect to any Planned Separator Facility or, with respect to any Planned Well that is not intended to be serviced by a Separator Facility, such Planned Well, in either case, that is not described in the First Development Report, 18 Months after the date of the Development Report that initially reflects the Planned Separator Facility or Planned Well, as applicable, unless Midstream Co consents to a shorter time period.

Tender ” means the act of Producer’s making Product available or causing Product to be made available to the System at a Receipt Point. “ Tendered ” shall have the correlative meaning.

Term ” has the meaning given to it in Section 8.1 .

Third Party ” means any Person other than a Party to this Agreement or any Affiliate of a Party to this Agreement.

Third Party Assignment ” has the meaning given to it in Section 16.1(a) .

 

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Texas Produced Water Services Agreement


Transaction Document ” means each agreement entered into pursuant to the agreement terms and conditions related to gas gathering services, agreement terms and conditions related to oil gathering services, agreement terms and conditions related to produced water services, agreement terms and conditions related to gas processing services, agreement terms and conditions related to crude oil treating services, and agreement terms and conditions related to fresh water services, now or in the future existing between Producer and Midstream Co.

Transfer ” means a sale, conveyance, assignment, exchange, farmout, disposition or other transfer of Dedicated Properties by Original Producer under Section 16.2(b) . In other Sections of this Agreement where the term uses a lower case, the term is not intended to have such a restrictive meaning.

Transporter ” means a wastewater truck transportation company engaged by Producer or Midstream Co, as applicable, to transport Trucked Volumes to the SWD Trucking Facility.

Trucked Volumes ” has the meaning given to it in Section 18.3(a) .

Trucked Water Services ” means, at any time when Producer has exercised its Trucking Election, Midstream Co shall make arrangements for the disposal of Dedicated Production that arrives by truck at the applicable SWD Trucking Facility. In addition, in connection with a Trucking Election, (a) during a Pre-Connection Period, if Producer requests and Midstream Co agrees, then with Producer’s reasonable cooperation, Midstream Co will arrange for the dispatching of the applicable trucks to the applicable SWD Trucking Facility and otherwise coordinate the water hauling trucks and (b) at all other times during a Pipeline Unavailability in which Producer has made a Trucking Election, Midstream Co shall arrange for the dispatching of the applicable trucks to the applicable SWD Trucking Facility and otherwise coordinate the water hauling trucks.

Trucked Water Services Commencement Date ” has the meaning given to it in Section 2.3(b) .

Trucking Election ” has the meaning given to it in Section 2.3(b) .

Well ” means a well (i) for the production of hydrocarbons, (ii) that is located in the Dedication Area, (iii) in which Producer owns an interest, and (iv) for which Producer has a right or obligation to market hydrocarbons (and related byproducts) produced thereby through ownership or pursuant to a marketing, agency, operating, unit, or similar agreement.

Year ” means a period of time from January 1 of a calendar year through December 31 of the same calendar year; provided that the first Year shall commence on the Effective Date and run through December 31 of that calendar year, and the last Year shall commence on January 1 of the calendar year and end on the Day on which this Agreement terminates.

Section 1.2 Other Terms . Other capitalized terms used in this Agreement and not defined in Section 1.1 above have the meanings ascribed to them throughout this Agreement.

Section 1.3 References and Rules of Construction . All references in this Agreement to Exhibits, Appendices, Articles, Sections, subsections and other subdivisions refer to the

 

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corresponding Exhibits, Appendices, Articles, Sections, subsections and other subdivisions of or to this Agreement unless expressly provided otherwise. Titles appearing at the beginning of any Articles, Sections, subsections and other subdivisions of this Agreement are for convenience only, do not constitute any part of this Agreement, and shall be disregarded in construing the language hereof. The words “this Agreement,” “herein,” “hereby,” “hereunder” and “hereof,” and words of similar import, refer to this Agreement as a whole, including the applicable Agreement Addendum and all Exhibits, Appendices, and other attachments to these Agreement Terms and Conditions and the applicable Agreement Addendum, all of which are incorporated herein, and not to any particular Exhibit, Appendix, Article, Section, subsection or other subdivision unless expressly so limited. The word “including” (in its various forms) means “including without limitation.” The word “or” shall mean “and/or” unless a clear contrary intention exists. The word “from” means “from and including”, the word “through” means “through and including”, and the word “until” means “until but excluding”. All references to “$” or “dollars” shall be deemed references to United States dollars. The words “will” and “shall” have the same meaning, force and effect. Each accounting term not defined herein will have the meaning given to it under generally accepted accounting principles. Pronouns in masculine, feminine or neuter genders shall be construed to state and include any other gender, and words, terms and titles (including terms defined herein) in the singular form shall be construed to include the plural and vice versa, unless the context otherwise requires. References to any Law, contract or other agreement mean such Law, contract or agreement as it may be amended, supplemented, released, revised, replaced, or otherwise modified from time to time.

Article 2

Product Dedication and Real Property Dedication

Section 2.1 Producer’s Dedications .

(a) Product Dedication . Subject to Section 2.2 through Section 2.4 , during the Term, Producer exclusively dedicates and commits to deliver to Midstream Co under this Agreement, as and when produced, all of the Dedicated Production and agrees not to deliver any Dedicated Production to any other gatherer, purchaser, or other Person prior to delivery to Midstream Co at the Receipt Points.

(b) Real Property Dedication . Subject to Section 2.2 through Section 2.4 , during the Term, Producer grants, dedicates, and commits the Dedicated Properties to Midstream Co for performance of the Services pursuant to this Agreement. Except for the Parties’ performance of their obligations under this Agreement, no further performance is required by either Party to effectuate the Real Property Dedication.

Section 2.2 Conflicting Dedications .

(a) Notwithstanding anything in this Agreement to the contrary, Producer shall have the right to comply with (i) each of the Conflicting Dedications existing on the Effective Date or, in the case of a Producer Assignee, the effective date of such assignment, and (ii) any other Conflicting Dedication applicable as of the date of acquisition of any oil and gas leases, mineral interests, and other similar interests within the Dedication Area that are acquired by Producer after the Effective Date and otherwise would have become subject to the Dedications (but not

 

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any Conflicting Dedications entered into in connection with such acquisition). Without the prior written consent of Midstream Co (which shall not be unreasonably withheld), Producer shall not extend or renew any Conflicting Dedication and shall terminate each Conflicting Dedication as soon as permitted under the underlying contract without causing Producer to incur any costs or expenses deemed unreasonable or inappropriate in the opinion of Producer and shall not enter into any new Conflicting Dedication. If services of the type provided hereunder are being provided to Producer by a Third Party with respect to Dedicated Properties under a Conflicting Dedication, then 180 Days prior to the expiration of such Conflicting Dedication, if requested by Producer, Midstream Co and Producer shall have a Meeting of Senior Management (unless both Parties agree that a Meeting of Senior Management is not required) to assess whether Midstream Co is ready, willing and able to begin providing Services with respect to such Dedicated Properties concurrently with the anticipated expiration or termination of the applicable Conflicting Dedication. If Midstream Co cannot provide Producer such assurances, then Midstream Co shall deliver to Producer a written consent to the extension of the applicable Conflicting Dedication. In no event shall Producer be required to begin using Services provided by Midstream Co on a Day other than the first Day of a Month.

(b) Certain Conflicting Dedications contain rights of first refusal or other provisions that (i) entitle Producer to a release of acreage from such Conflicting Dedication if Producer dedicates the released acreage to a Third Party or (ii) expressly prohibit Producer from dedicating such released acreage to an Affiliate of Producer. As used herein, the term “Conflicting Dedication” shall include both the original right of first refusal (or similar right) and the dedication resulting from an exercise of such right of first refusal (or similar right) so long as the resulting dedication covers the same acreage as the original Conflicting Dedication.

(c) To the extent Producer claims that a Conflicting Dedication exists with respect to certain Services on specified Dedicated Properties, Midstream Co shall have the right to review the documentation creating such Conflicting Dedication, subject to confidentiality requirements applicable to such Conflicting Dedication.

Section 2.3 Producer’s Reservation . Producer reserves the following rights respecting Dedicated Production for itself:

(a) to operate (or cause to be operated) Wells producing Dedicated Production in its sole discretion, including the right to drill new Wells, repair and rework old Wells, temporarily shut in Wells, renew or extend, in whole or in part, any oil and gas lease or term mineral interest, or cease production from or abandon any Well or surrender any applicable oil and gas lease, in whole or in part, when no longer deemed by Producer to be capable of producing in paying quantities under normal methods of operation; and

(b) following the date set forth in writing between Producer and Midstream Co (such date as it may be updated by Midstream Co and Producer, the “Trucked Water Services Commencement Date”), Producer may elect to deliver or have delivered Dedicated Production directly to a SWD Trucking Facility during any Pipeline Unavailability as provided in Section 18.2 (the “ Trucking Election ”); and

(c) Reserved ;

 

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(d) to pool, communitize or unitize Producer’s interests with respect to Dedicated Production.

Section 2.4 Releases from Dedication .

(a) Permanent Releases . Midstream Co shall permanently release from the Dedications: (i) any Dedicated Production from any Well, Dedicated Properties, or Spacing Unit affected by one or more of the Release Conditions, (ii) any Dedicated Production that would have been delivered to a Separator Facility affected by one or more of the Release Conditions, (iii) any Dedicated Properties affected by one or more of the Release Conditions and (iv) any Purchased Dedicated Production for which the Individual System has been affected by one or more of the Release Conditions. The “ Release Conditions ” are:

(i) Midstream Co’s failure to complete the facilities that are described on a System Plan and that are necessary to connect any Planned Separator Facility or Planned Wells to the System or failure to commence the Services with respect to any Planned Separator Facility or Planned Wells by the applicable On-Line Deadline (so long as such failure was not the result of Producer’s failure to comply with the then-applicable Development Report);

(ii) Midstream Co’s election (x) pursuant to Section 3.1(c) not to provide Services for any Well or Separator Facility included in a Development Report delivered by a Producer that is not the Original Producer or (y) pursuant to Section 3.3(b) not to provide Services for (1) any Well or Separator Facility for which Producer failed to deliver a Development Report on or before the applicable deadline set forth in Section 3.1(a) , (2) any Well or Separator Facility not described in the applicable Development Report or (3) any excess volume of Product produced from any Well during any Day that exceeds the volume included in Producer’s estimate set forth in the most recent Development Report delivered to Midstream Co;

(iii) expiration of the Term, as further described in Section 8.2;

(iv) written agreement of Producer and Midstream Co, and each Party shall consider in good faith any proposal by the other Party to permanently release any Dedicated Production or Dedicated Properties;

(v) the occurrence of a Force Majeure of the type described in clauses (l), (m) or (n) of the definition of “ Force Majeure ” affecting Midstream Co that continues for a period of 120 Days or more;

(vi) Midstream Co’s interruption or curtailment of receipts and deliveries of Product from any Well or Separator Facility pursuant to Section 5.5 that continues for 90 Days or more, except to the extent (A) such interruption or curtailment is caused by the acts or omissions of Producer, or (B) Producer elects to reduce the Individual First Phase Fee with respect to any volumes that are affected by a Downtime Event pursuant to Section 6.2(c) ;

 

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(vii) a default (other than a default of the type covered by Section 2.4(a)(i) ) by Midstream Co that remains uncured for 90 Days or more;

(viii) Producer’s rejection of any increase in the Individual Fee pursuant to Section 13.1(b) ; or

(ix) Midstream Co’s suspension of Services pursuant to Section 13.2(a)(ii) that extends for the period of time stated in such Section or (y) Midstream Co’s election not to expand an Individual System pursuant to Section 13.2(b) .

Producer may deliver any Dedicated Production released from the Dedications pursuant to this Section 2.4(a) to such other gatherers as it shall determine.

(b) Temporary Release . Midstream Co shall temporarily release from the Dedications: (i) any Dedicated Production from any Well, Dedicated Properties, or Spacing Unit affected by one or more of the Interruption Conditions, (ii) any Dedicated Production that would have been delivered to a Separator Facility affected by one or more of the Interruption Conditions, (iii) any Dedicated Properties affected by one or more of the Interruption Conditions, and (iv) any Purchased Dedicated Production for which the Individual System has been affected by one or more of the Interruption Conditions. The “ Interruption Conditions ” are:

(i) the occurrence and continuation of an uncured default by Midstream Co;

(ii) Midstream Co’s interruption or curtailment of receipts and deliveries of Product pursuant to Section 5.5 that continues for a period of 15 consecutive Days, except to the extent (A) such interruption or curtailment is caused by the acts or omissions of Producer, or (B) Producer elects to reduce the Individual First Phase Fee with respect to any volumes that are affected by a Downtime Event pursuant to Section 6.2(c) ; and

(iii) Until a permanent release is required under Section 2.4(a) or Section 13.2, Midstream Co’s suspension of Services pursuant to Section 13.2(a) (and, if Section 13.2(a)(i) applies, such temporary release shall continue at the discretion of Midstream Co, subject to the time limits set forth in Section 13.2(a)(i) ).

Producer may make alternative arrangements for the gathering of any Dedicated Production temporarily released from the Dedications pursuant to this Section 2.4(b) . To the extent that an interruption or curtailment can be limited to a Facility Segment, Midstream Co shall so limit such interruption or curtailment, and to the extent that Midstream Co does so limit such curtailment or interruption, the temporary release permitted by this Section 2.4(b) shall only apply to the affected Facility Segment. Such temporary release shall continue until the first Day of the Month after the Month during which Midstream Co cures the applicable default or the interruption, curtailment, or suspension of Services terminates; provided that, if Producer obtained temporary services from a Third Party (pursuant to a contract that does not give rise to a default under this Agreement) during the pendency of such default, interruption, curtailment, or suspension, such release shall continue until the earlier of (A) the first Day of the Month that is six Months after the event or condition that gave rise to the interruption, curtailment or other temporary cessation has been corrected and (B) the first Day of the Month after the termination

 

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of the applicable contract with such Third Party. For the avoidance of doubt, the temporary services that Producer may obtain under Section 3.3 shall not constitute a release under the terms of this Agreement; provided that, if Producer cannot obtain such temporary services without a temporary release, Midstream Co may in its discretion grant or refuse to grant a temporary release on such terms as reasonably required by Midstream Co (including, for example, conditioning the grant of a temporary release on the establishment of a termination date for such temporary release).

(c) Evidence of Release . At the request of Producer, the Parties shall execute a release agreement reasonably acceptable to all Parties (which, in the case of a permanent release, shall be in recordable form) reflecting any release of Dedicated Production or Dedicated Properties pursuant to this Section 2.4 .

Section 2.5 Covenants Running with the Land . Subject to the provisions of Section 2.3 and Section 2.4 , each of the Dedications (a) is a covenant running with the Dedicated Properties, (b) touches and concerns Producer’s interests in the Dedicated Properties, and (c) shall be binding on and enforceable by Midstream Co and its successors and assigns. Except as set forth in Article 16 , (i) in the event Producer sells, transfers, conveys, assigns, grants or otherwise disposes of any or all of its interest in the Dedicated Properties, then any such sale, transfer, conveyance, assignment, grant or other disposition shall be made subject to this Agreement and (ii) in the event Midstream Co sells, transfers, conveys, assigns, grants or otherwise disposes of any or all of its interest in the Individual System, then any such sale, transfer, conveyance, assignment, grant or other disposition shall be made subject to this Agreement. The Real Property Dedication is not an executory contract under Section 365 of Title 11 of the United States Code (11 U.S.C. § 365).

Section 2.6 Recording of Agreement . Producer hereby authorizes Midstream Co to record a memorandum of the Agreement in the real property records of the counties in which the Dedication Area is located. Midstream Co and Producer agree that until Midstream Co provides notice to the contrary, all payment terms and pricing information shall remain confidential and be redacted from any filings in the real property records.

Article 3

System Expansion and Connection of Wells

Section 3.1 Development Report; System Plan; Meetings .

(a) Development Report . Original Producer will provide, on or before October 1, 2016, and each Producer Assignee will provide, on or before the date stated in Section 16.1 , Midstream Co with its First Development Report, which shall describe (x) in detail the planned development, drilling, and production activities relating to the Dedicated Production through the end of the applicable Period of Two Years, and (y) generally the long-term drilling and production expectations for those project areas in which drilling activity is expected to occur during the applicable Period of Five Years, including the information described in Section 3.1(b) . On or before each January 1, each April 1, each July 1, and each October 1 of each Year following the date on which the First Development Report is to be delivered, Producer shall provide to Midstream Co an update of the then-current report (the First Development Report, as updated in accordance with the foregoing and as the then current report may be updated from time to time, the “ Development Report ”).

 

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(b) Development Report Content . With respect to the Dedication Area, the Development Reports shall include information as to:

(i) the Wells (each, a “ Planned Well ”) and Separator Facilities (each, a “ Planned Separator Facility ”) that Producer expects to drill or install during the applicable Period of Two Years, including the expected locations, completion dates thereof (which completion dates shall not be earlier than the applicable Target On-Line Dates), the expected spud dates of such Planned Wells, and dates flow is anticipated to initiate from such Wells;

(ii) the anticipated Product content from any Well and Separator Facility that Producer expects to produce during the applicable Period of Two Years;

(iii) the Receipt Points and Delivery Points (including proposed receipt points and delivery points not yet agreed in writing among the Parties) at which Product produced from each Well is to be disposed of or redelivered to Producer during the applicable Period of Two Years;

(iv) the number of Planned Wells and Planned Separator Facilities anticipated to be producing after the Period of Two Years and before the end of the Period of Five Years, broken out by an appropriate geographic area, such as a development plan area;

(v) the actual lateral length for each Well described in the Period of Two Years, the anticipated lateral length for each Planned Well described in the Period of Two Years and initial assumptions for the planned lateral length for each Planned Well anticipated to be producing after the Period of Two Years and before the end of the Period of Five Years;

(vi) the number of rigs that Producer intends to operate in the Dedication Area each year during the Period of Five Years (including sufficient detail regarding the anticipated location of such rigs to allow Midstream Co to determine which Individual System would be impacted by such rig activity);

(vii) with respect to the Period of Two Years, the anticipated date of each frac, the quantity of fresh water required to complete such frac and an indication of the type of frac to be performed (slick, hybrid gel, gel, etc.);

(viii) with respect to the Period of Two Years, the anticipated date on which Midstream Co may initiate construction or other development activities at the Well or Separator Facility in order to complete the interconnection into the Individual System; and

(ix) such other information as may be reasonably requested by Midstream Co with respect to Wells and Separator Facilities that Producer intends to drill or from which Producer intends to deliver Product during the Period of Two Years and Period of Five Years.

 

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To the extent possible, any information Producer is required to provide under this Section 3.1(b) with respect to Wells or Separator Facilities shall also include such information related to Planned Wells and Planned Separator Facilities. In addition, if appropriate to provide a complete and accurate Development Report, any information requested with respect to Planned Wells and Planned Separator Facilities shall also be provided with respect to existing Wells or Separator Facilities.

(c) System Plan . Based on the Development Report and such other information about the expected development of the Dedicated Properties as shall be provided to Midstream Co by or on behalf of Producer, including as a result of meetings between representatives of Midstream Co and Producer, Midstream Co shall develop and periodically update a plan (the “ System Plan ”) describing or depicting the modifications, extensions, enhancements, major maintenance and other actions necessary in order for the Individual System to be able to provide timely Services for the Product produced by the Wells and Separator Facilities described in the most recent Development Report (including Planned Wells, Planned Separator Facilities and changes in anticipated production from existing Wells and Separator Facilities). Without limiting or otherwise altering Midstream Co’s rights under Section 13.2 , unless the applicable Well or Separator Facility is operated by Original Producer, Midstream Co may elect, in its sole discretion, not to make such modifications, extensions, enhancements, major maintenance, or other actions to the System (the “ Modifications ”) and not to provide Services for any Wells or Separator Facilities included in a Development Report delivered by a Producer that is not the Original Producer. If (i) Midstream Co elects to make such Modifications, (ii) Producer thereafter modifies the Development Report or provides other information (the date on which the modified Development Report or such other information is provided to Midstream Co, the “ Cancellation Date ”) indicating that such Modifications are no longer necessary, and (iii) as of the Cancellation Date, the actual aggregate costs and expenses (excluding Excluded Amounts) incurred or committed by Midstream Co to make such cancelled Modifications exceeds $100,000.00, then Producer shall reimburse Midstream Co for all reasonable and documented costs and expenses (other than the Excluded Amounts) incurred or committed by Midstream Co through the Cancellation Date to make such Modifications. The System Plan shall include information as to:

(i) each Facility Segment then existing and operational, under construction, or planned and the Individual System of which such Facility Segment is a part;

(ii) all Internal Transfer Points, Receipt Points and Delivery Points served or to be served by each such Facility Segment;

(iii) Reserved ;

(iv) all pumps, treatment, oil, separators, Recovered Oil recovery, and other major physical facilities located or to be located on or within each such Facility Segment, together with their sizes, operating parameters, capacities, and other relevant specifications, which sizes, parameters, capacities and other relevant specifications shall

 

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be sufficient to (x) connect the Individual System to the Receipt Points and Delivery Points for all Planned Separator Facilities and (with respect to any Planned Wells not intended to be serviced by a Separator Facility) Planned Wells set forth in the most recent Development Report and (y) perform the Services for all Dedicated Production projected to be produced from the Dedicated Properties as contemplated by the most recent Development Report;

(v) the anticipated schedule for completing the construction and installation of the planned Facility Segments and all planned Receipt Points, Internal Transfer Points and Delivery Points, in each case, for all Planned Separator Facilities or Planned Wells, as applicable, included in the most recent Development Report;

(vi) the allocation methodologies to be used by Midstream Co with respect to System Gains/Losses, Other System Fuel, Recovered Oil, and other allocations hereunder and, with respect to any System Plan after the initial System Plan, any proposed changes to the allocation methodologies then in effect, which allocation methodologies shall (A) permit allocations to be made by Midstream Co in a commercially reasonable manner; and (B) be based upon the measurements taken and quantities determined for the applicable Month. Midstream Co shall allocate, in a manner that is commercially reasonable and determined by Midstream Co in good faith, to a particular Receipt Point, the Recovered Oil from a Facility Segment.

(vii) other information reasonably requested by Producer that is relevant to the design, construction, and operation of the System, the relevant Individual System, the relevant Facility Segment, and the relevant Receipt Points, Internal Transfer Points and Delivery Points; provided that in no event shall Midstream Co be obligated to supply to Producer (A) pricing, budget or similar financial information or (B) information that is covered by a confidentiality agreement or confidentiality obligations;

Midstream Co shall deliver the applicable System Plan (including any updated System Plan) to Producer for Producer’s review and comment not later than 30 Days after Producer’s delivery to Midstream Co of the applicable Development Report or amendment thereto.

(d) Meetings . Midstream Co shall make representatives of Midstream Co available to discuss the most recent System Plan with Producer and its representatives at Producer’s written request. Producer shall make representatives of Producer available to discuss the most recent Development Report with Midstream Co and its representatives at Midstream Co’s written request. The Parties agree that the meetings described in the previous sentences of this clause (d) may occur (and shall, if requested by either Party) on a Monthly basis. At all such meetings, the Parties shall exchange updated information about their respective plans for the development and expansion of the Dedicated Properties (including amendments to the Development Report) and the System (including amendments to the System Plan for Producer’s review and comment) and shall have the opportunity to discuss and provide comments on the other Party’s plans.

(e) Scope and Purpose of Planning Tools . The Development Report and the System Plan are intended to assist Midstream Co and Producer with long-term planning and goals. None of the Development Reports nor the System Plans shall amend or modify this Agreement in any

 

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way. Midstream Co may, in its sole discretion, work with OpCo or any of OpCo’s subsidiaries to prepare and deliver a System Plan jointly with such other entity or entities. To the extent that a Development Report or System Plan that satisfies the requirements above is delivered or deemed delivered under any other Transaction Document, such Development Report or System Plan shall be deemed delivered hereunder.

Section 3.2 Expansion of System and Connection of Separator Facilities .

(a) Service Standards . Midstream Co shall, at its sole cost and expense, design, construct (as applicable), and own the Individual System in a good and workmanlike manner and in accordance with the System Plan and this Section 3.2 . Until such time as Producer has delivered a Development Report, Midstream Co shall have no obligation under this Section 3.2(a) .

(b) On-Line Deadline . Subject to Section 12.2 , Midstream Co shall by the later of (x) the date that the first Planned Well on a particular Planned Separator Facility (or, with respect to a Planned Well that is not intended to be serviced by a Separator Facility, the date that such Planned Well) is ready for connection to the System and (y) the applicable Target On-Line Date (such later date, the “ On-Line Deadline ”): (i) have completed (or caused the completion of) the construction of the necessary facilities, in accordance with the then current System Plan, (A) to connect such Planned Separator Facility or such Planned Well to the System and (B) to connect the System to each planned Delivery Point for such Planned Separator Facility or such Planned Well, as applicable, and (ii) be ready and able to commence Services with respect to Dedicated Production from such Planned Separator Facility or Planned Well, as applicable.

(c) Additional/Accelerated Well . From time to time, Producer may provide notice to Midstream Co that Producer has accelerated the Target On-Line Date for a Planned Well or Planned Separator Facility (any such Well or Separator Facility, an “ Additional/Accelerated Well ”). Midstream Co will use its commercially reasonable efforts to modify the System Plan and to cause the necessary gathering facilities to be constructed prior to the On-Line Deadline for such Additional/Accelerated Well. From time to time, Producer may provide notice to Midstream Co that Producer (i) has delayed the Target On-Line Date for a Planned Well or Planned Separator Facility, (ii) subject to Section 3.2(d) , anticipates eliminating a Planned Well or Planned Separator Facility from its development plans and the Development Report, or (iii) anticipates shutting in a Well or Separator Facility that has been producing. Midstream Co may adjust the System Plan as it determines to be appropriate and commercially reasonable to accommodate such elimination of such Wells and Separator Facilities.

(d) Cancellation of Planned Wells and Planned Separator Facilities . If (i) Midstream Co reasonably determines that Producer has permanently abandoned the drilling or installation of any Planned Well or Planned Separator Facility or Producer notifies Midstream Co that Producer intends to permanently abandon the drilling or installation of any Planned Well or Planned Separator Facility (whether through the delivery of an updated Development Report or otherwise, the date on which such determination is made, the “ Abandonment Date ”), (ii) Midstream Co had begun to design or construct the Facility Segment to connect such Planned Well or Planned Separator Facility to the System prior to such Abandonment Date, and (iii) the actual aggregate costs and expenses (excluding Excluded Amounts) incurred or committed by

 

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Midstream Co prior to the Abandonment Date exceeds $100,000.00, then Producer shall reimburse Midstream Co for all reasonable and documented costs and expenses (other than the Excluded Amounts) incurred or committed by Midstream Co prior to such Abandonment Date to design and construct such Facility Segment.

(e) Substation and Interconnection Facilities . The obligations of Midstream Co hereunder to design and construct the Individual System and to perform the Services do not include the design or construction of any substation or other interconnecting facilities required to procure electricity for the Individual System. If a substation or any other interconnecting facility is required in order for Midstream Co to perform its obligations hereunder, Midstream Co and Producer shall enter into a separate agreement setting forth each Party’s responsibilities in connection therewith, including an allocation of responsibility for all associated costs and expenses.

Section 3.3 Temporary Services .

(a) Pending the completion of facilities contemplated in a System Plan or that may be required to service Wells in existence as of the Effective Date, Producer may enter into a contract with a Third Party to provide services with respect to the Dedicated Production that is anticipated to be serviced by the new, modified, or enhanced facilities if the term of such contract does not exceed six Months (and may be renewed in six-Month increments until such time as Midstream Co has completed the applicable facilities).

(b) If at any time, (i) Producer fails to deliver a Development Report on or before the applicable deadline set forth in Section 3.1(a) , (ii) a Development Report delivered by Producer failed to describe any Well, or (iii) the average rate of production at any Receipt Point described in the then-applicable Development Report exceeds Producer’s forecast for such Receipt Point set forth in such Development Report, and as a result, Midstream Co has not completed any new, modified, or enhanced facilities necessary to allow Midstream Co to accept all of the Product Tendered by Producer at a Receipt Point, then (x) within a reasonable time after Midstream Co becomes aware of the need for such new, modified, or enhanced facilities, Midstream Co shall elect, in its sole discretion, whether to proceed with the development and completion of such facilities by providing notice to Producer, and (y) if Midstream Co elects to proceed with the development and completion of such facilities, (1) Midstream Co shall cause such facilities to be completed within a reasonable time after such election, and (2) pending the completion of such facilities, Midstream Co may elect (in its reasonable discretion and in exchange for reasonable compensation) to permit Producer to enter into a contract with a Third Party as provided in Section 3.3(a) to provide services with respect to the Dedicated Production that Midstream Co is unable to accept.

(c) Any time Producer makes alternative arrangements with a Third Party for the provision of services or to accept Product as provided for in this Agreement, Producer shall (i) if Midstream Co anticipates being able to provide Services hereunder or to accept Product within a period of time that is shorter than six Months, use commercially reasonable efforts to enter into a contract with a term that expires on or around the date on which Midstream Co anticipates being able to provide Services hereunder or to accept Product, and (ii) notify Midstream Co of the term of such contract promptly after execution thereof. Prior to requiring Producer to begin using, or

 

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resume using, as applicable, Services hereunder, Midstream Co shall provide notice to Producer of the date on which Midstream Co expects to be ready, willing and able to begin providing Services to Producer no later than 45 Days prior to the expiration of the Third Party contract. In no event shall Producer be required to begin using, or resume using, as applicable, Services on a Day other than the first Day of a Month.

Section 3.4 Cooperation . The Parties shall work (at their own cost and expense) together in good faith to obtain such Permits as are necessary to drill and complete each Planned Well and construct the required extensions of the System to each Planned Separator Facility (and each Planned Well, as applicable) as expeditiously as reasonably practicable, all as provided in this Agreement. The Parties shall cooperate with each other and to communicate regularly regarding their efforts to obtain such Permits. Upon request by Producer, Midstream Co shall promptly provide to Producer copies of all Permits obtained by Midstream Co in order to construct any Facility Segment (or portion of a Facility Segment) of the System.

Section 3.5 Grant of Access; Real Property Rights .

(a) Producer’s Grant of Access . Producer hereby grants to Midstream Co, without warranty of title, either express or implied, to the extent that it may lawfully and is contractually permitted to do so without the incurrence of additional expense, the rights of ingress and egress with respect to, and the right to access, all lands constituting Dedicated Properties for the purpose of using, maintaining, servicing, inspecting, repairing, and operating all or any portion of the applicable Individual System, including all pipelines, meters and other equipment necessary for the performance by Midstream Co of this Agreement. Such right of access shall not include any right to install, replace, disconnect, or remove all or any portion of the applicable Individual System, which rights may only be granted pursuant to a separate instrument entered into pursuant to Section 3.5(f) .

(b) Producer Does Not Have Obligation to Maintain . Producer shall not have a duty to maintain in force and effect any underlying agreements (such as any lease, easement, or surface use agreement) that the grant of access by Producer to Midstream Co under Section 3.5(a) is based upon, and such grant will terminate if Producer loses its rights to the applicable property, regardless of the reason for such loss of rights.

(c) Midstream Co’s Grant of Access . Midstream Co hereby grants to Producer, without warranty of title, either express or implied, to the extent that it may lawfully and is contractually permitted to do so without the incurrence of additional expense, the rights of ingress and egress with respect to, and the right to access, all lands covered by the Individual System in order to exercise its rights and obligations hereunder. Such right shall not include any right to install, replace, disconnect, or remove any facilities on such lands, which rights may only be granted pursuant to a separate instrument entered into pursuant to Section 3.5(f) . Producer shall release, protect, defend, indemnify and hold harmless Midstream Co Group from and against all Losses directly or indirectly arising out of or in connection with bodily injury, death, illness, disease, or loss or damage to property of Midstream Co or any member of Midstream Co Group directly arising from Producer’s exercise of its access rights hereunder, except to the extent such Losses are caused by the gross negligence or willful misconduct of Midstream Co Group.

 

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(d) Midstream Co Does Not Have Obligation to Maintain . Midstream Co shall not have a duty to maintain in force and effect any underlying agreements that the grant of access by Midstream Co to Producer pursuant to this Section 3.5(d) is based upon, and such grant will terminate if Midstream Co loses its rights to the applicable property, regardless of the reason for such loss of rights.

(e) No Interference . A Party’s exercise of the rights granted to a Party by the other Party pursuant to this Section 3.5 shall not unreasonably interfere with the granting Party’s operations or with the rights of owners in fee with respect to the applicable lands, and such rights will be exercised in material compliance with all applicable Laws and the safety and other reasonable access requirements of the granting Party. Each Party obtaining a right of access pursuant to this Section 3.5 shall have the status of “licensee,” except when such Party is accessing the applicable real property by way of a right-of-way, easement, or other similar real property right granted pursuant to a separate instrument.

(f) Real Property Rights . Each Party shall acquire and maintain all easements, rights of way, surface use, surface access agreements, and other real property rights from Third Parties necessary to perform its obligations hereunder. To the extent a Party has the contractual right and title to do so, such Party shall provide to the other Party the right of co-usage on the easements, sub-easements, rights of way, surface use, and other real property rights held by such Party covering lands for which the other Party requires real property rights to perform its obligations hereunder, all at no cost to the providing Party and on terms and conditions mutually acceptable to the Parties in their reasonable discretion. Where a Party does not have the contractual right to do so, such Party shall provide reasonable assistance to the other Party in obtaining the real property rights with respect to such lands as necessary or desirable to perform its obligations hereunder.

Article 4

Measurement Devices

Section 4.1 Measurement Devices .

(a) Midstream Co shall construct, install, own, and operate (or cause to be constructed, installed, and operated) the Measurement Devices located at the Measurement Points. Midstream Co may, in its discretion, construct, install, own, and operate (or cause to be constructed, installed, and operated) Measurement Devices located at or upstream of the Delivery Points or at or downstream of the Receipt Points.

(b) Midstream Co shall cause all Measurement Devices that are owned by Midstream Co to be constructed, installed, and operated in accordance with applicable industry standards and applicable Laws, and as set forth in the current System Plan.

(c) Producer shall have the right, at its sole expense, to install, own and operate Measurement Devices located at the Measurement Points, Receipt Points and Delivery Points. Producer shall cause Producer Meters to be installed, subsequent to providing a minimum of seventy-two (72) hours’ notice to Midstream Co, so as not to interfere with Midstream Co’s Measurement Devices and shall take steps that are reasonable and customary in the industry to mitigate or prevent any problems that may interfere with Midstream Co’s Measurement Devices at the Measurement Points.

 

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(d) Midstream Co may elect to use a Producer Meter as the Measurement Device for a Measurement Point in lieu of constructing, installing, owning, and operating a Measurement Device located at such Measurement Point by providing notice to Producer (including by detailing such election in the applicable System Plan). If Midstream Co elects to use such Producer Meter as the Measurement Device for a Measurement Point, Producer shall provide Midstream Co reasonable access to such Producer Meter, including prior advance notice of, and the ability to witness, the calibration of such Producer Meter.

(e) Producer and Midstream Co shall cause Measurement Devices owned by such Party to be constructed, installed and operated in a manner which is agreeable to all parties involved and satisfies local and state regulation.

(f) Midstream Co may (but shall not be obligated to) replace or make any alterations to the Measurement Devices necessary to comply with any subsequent amendments, revisions or modifications of Applicable Law. With respect to Producer Meters that Midstream Co has elected to use, Producer may (but shall not be obligated to) replace or make any alterations to the Measurement Devices necessary to comply with subsequent amendments, revisions or modifications of Applicable Law.

(g) The accuracy of all Measurement Devices at the Measurement Points and Delivery Points, and of all Measurement Devices that serve as “check meters” for any such Measurement Point or Delivery Point Measurement Devices will be verified by the owner of such Measurement Device (the “ Owner ”) at Monthly intervals and, if requested, in the presence of a representative of the other Party (the “ Beneficiary ”). The Owner shall verify the accuracy of any owned Measurement Device before the next Monthly verification required by the preceding sentence if the Beneficiary makes a written request for a special test as described below. Notwithstanding the foregoing, when Daily deliveries of Product at any Measurement Point or Delivery Point average 100 Barrels per Day or less during any Month, the Owner may request from the Beneficiary that the accuracy of the Measurement Devices at such Measurement Point or Delivery Point be verified quarterly. If, upon any test, any (i) Measurement Device at the Measurement Point is found to be inaccurate by 2.0% or less or (ii) Measurement Device at the Delivery Point is found to be inaccurate by 0.25% or less, previous readings of such Measurement Device will be considered correct in computing the deliveries of Product under this Agreement. If, upon any test, any (1) Measurement Device at the Measurement Point is found to be inaccurate by more than 2.0% or (2) Measurement Device at the Delivery Point is found to be inaccurate by more than 0.25% (excessive meter factor deviation), such Measurement Device will immediately be removed from service, adjusted, calibrated, repaired or replaced to record accurately (within the manufacturer’s allowance for error) and reproved prior to returning to service. If the excessive meter factor deviation can be explained by changing conditions (gravity, temperature or flow-rate) no corrective action may be taken if mutually agreed upon by both the Owner and the Beneficiary. Any previous recordings of such Measurement Device with an excessive meter factor deviation will be corrected by using the arithmetic average of the malfunction factor and the previous factor shall be applied to the production measured through the meter between the date of the previous factor and the date of the malfunction factor. The

 

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proving report must clearly indicate the meter’s malfunction factor and all remarks associated with the repairs or adjustments. If the Beneficiary desires a special test of any Measurement Device, at least 72 hours’ advance written notice will be given to the Owner, and the Parties will cooperate to secure a prompt test of the accuracy of such Measurement Device. If the Measurement Device so tested is found to be inaccurate by 2.0% or less or 0.25% or less, as applicable, the Owner will have the right to bill the Beneficiary for the costs incurred due to such special test, including any labor and transportation costs, and the Beneficiary will pay such costs promptly upon invoice therefor.

(h) If requested by the Beneficiary, the Measurement Devices owned by Owner shall include a sufficient number of data ports, and Owner shall permit Beneficiary to connect to such data ports, as shall be required to provide to Beneficiary on a real-time basis all measurement data generated by such measurement equipment. Beneficiary shall be responsible at its own cost for obtaining equipment and services to connect to such data ports and receive and process such data.

(i) Each Party shall make the charts and records by which measurements are determined available for the use of the other Party in fulfilling the terms and conditions thereof. Each Party shall, upon written request of the other Party, mail, email or deliver for checking and calculation all measurement data, including flowing parameters, characteristics, constants, configurations and events in its possession and used in the measurement of Product delivered under this Agreement within 30 Days after the last chart for each billing period is removed from the meter. Such data shall be returned within 90 Days after the receipt thereof.

(j) Each Party shall preserve or cause to be preserved for mutual use all test data or other similar records in accordance with the applicable rules and regulations of regulatory bodies having jurisdiction, if any, with respect to the retention of such records, and, in any event, for at least 24 Months.

(k) So long as the Parties to this Agreement are also parties to a Transaction Document that covers Crude Oil, the requirements for Measurement Devices in respect of Recovered Oil shall be covered by such Transaction Document. If at any time the Parties to this Agreement are not also party to another Transaction Document that covers Crude Oil, the Parties shall set forth in the Agreement Addendum or an appropriate amendment to this Agreement the requirements for Measurement Devices pertaining to Recovered Oil; absent such agreement, Midstream Co shall install and maintain measuring equipment at the Delivery Points that is in accordance with applicable API standards.

Section 4.2 Measurement Procedures . Midstream Co shall use the Measurement Devices owned by Midstream Co (or if Midstream Co’s rights under Section 4.1(d) are exercised, then the Measurement Devices owned by Producer) at the Measurement Points to determine the volumes of Product passing through the Individual System for purposes of Article 6 and Article 10 . Midstream Co shall cause (or if Midstream Co’s rights under Section 4.1(d) are exercised, then Producer shall cause) the measurements of the quantity and quality of all Product measured at the Measurement Points (and at each Receipt Point or Delivery Point at which measurements are taken) to be conducted in accordance with industry standards (referenced below):

 

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API Manual of Petroleum Measurement Standards:

 

  Chapter 4, Proving Systems

 

  Chapter 5.1. General Considerations for Measurement by Meters

 

  Chapter 5.6, Measurement of Liquid by Coriolis Meters

 

  Chapter 7, Temperature Determination

 

  Chapter 8, Sampling

 

  Chapter 8.2, Automatic Sampling of Petroleum and Petroleum Products

 

  Chapter 9, Density Determination

 

  Chapter 10, Sediment and Water

 

  Chapter 12.2, Calculation of Petroleum Quantities Measured by Turbine or Displacement Meters.

Section 4.3 Product Meter Adjustments . If a Measurement Device is out of service or registering inaccurately, the Parties shall determine the quantities of Product received or delivered during such period as follows:

(a) By using the registration of any check meter or meters, if installed and accurately registering; or in the absence of such check meters,

(b) By using a meter operating in parallel with the estimated volume corrected for any differences found when the meters are operating properly,

(c) By correcting the error if the percentage of error is ascertainable by calibration, tests or mathematical calculation, such as step change, uncertainty calculation or balance adjustment; or in the absence of check meters and the ability to make corrections under this Section 4.3(c) , then,

(d) By estimating the quantity received or delivered by receipts or deliveries during periods under similar conditions when the meter was registering accurately.

Article 5

Tender, Nomination, and Gathering of Production

Section 5.1 Limitations on Service to Third Parties . Midstream Co shall obtain Original Producer’s consent prior to offering services on an Individual System to any Third Party, unless (a) Midstream Co is required by a Governmental Authority to offer service to a Third Party, in which case Midstream Co shall provide Producer prior notice of offering such service to such Third Party, (b) such Third Party has become a Producer hereunder by virtue of assignment of Dedicated Properties to such Party, or (c) Original Producer has ceased to operate acreage serviced by such Individual System.

 

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Section 5.2 Tender of Dedicated Production . Subject to Section 5.3(c) , (a) each Day during the Term, Producer shall Tender to the Individual System at each applicable Receipt Point all of the Dedicated Production available to Producer at such Receipt Point and (b) Producer shall have the right to Tender to Midstream Co for Services under this Agreement Product other than Dedicated Production.

Section 5.3 Services; Service Standard .

(a) Services . Subject to Section 5.3(c) , Midstream Co shall provide all of the Services, including all services related to collecting, gathering, cleaning, treating, and disposing of the Product.

(i) Midstream Co shall cause the applicable Individual System to be able to flow such Product at volumes produced into such Individual System, so long as total water volumes for such Individual System are not greater than the current capacity of such Individual System.

(ii) The quantity of Product for which Midstream Co shall provide the Services is:

(A) with respect to the receipt, collection, gathering, storage and cleaning Services further described in clauses (a) , (b) , (c)  and (d)  of the definition of “Services”, all of the Product that is Tendered by Producer to Midstream Co at the applicable Receipt Points, so long as such quantity is not in excess of the current capacity of the applicable Individual System;

(B) with respect to the delivery Services further described in clause (e) of the definition of “Services”, Midstream Co shall deliver to the applicable Internal Transfer Points a quantity of Product equivalent to the quantity described in the preceding clause, taking into account any System Gains/ Losses; and

(C) with respect to Second Phase Services, Midstream Co shall be responsible for either disposing of all quantities of Product that flow through the applicable Internal Transfer Point.

(b) Services Standard . Midstream Co shall own and operate (or contract for, as applicable) the System and perform the Services in a good and workmanlike manner in accordance with standards customary in the industry.

(c) Priority of Service . Midstream Co shall cause (i) Product delivered by Original Producer to have priority service on the System over Product of any Producer Assignee to the extent not in violation of applicable Law, and (ii) Product delivered by Producer to have priority service on the System over Product of any Third Party. Midstream Co’s performance of its obligations under Section 5.3(a) with respect to any Product (A) of any Producer Assignee, or (B) produced from any Well but not included on a Development Report or for which new, modified, or enhanced facilities are contemplated in a System Plan, shall at all times be subject to the available capacity on the System at the time that Product is available to be Tendered by Producer at a Receipt Point; provided, however, that in the case of clause (B), Producer may make alternative arrangements for the Product not received by Midstream Co pursuant to Section 3.3 .

 

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Section 5.4 Nominations, Scheduling, and Curtailment . Product shall be received and redelivered under this Agreement at the similar quantities for a delivery Month. Midstream Co shall use System storage only for the operational purposes, as determined solely by Midstream Co. Nothing contained in this Agreement shall preclude Midstream Co from taking reasonable actions necessary to adjust receipts or deliveries under this Agreement in order to maintain the operational integrity and safety of the System.

Section 5.5 Suspension/Shutdown of Service .

(a) Shutdown . During any period when all or any portion of the Individual System is shut down (i) because of maintenance, repairs, or Force Majeure, (ii) because such shutdown is necessary to avoid injury or harm to Persons or property, to the environment or to the integrity of all or any portion of the Individual System or (iii) because providing Services hereunder has become uneconomic as further described in Section 13.2 , Midstream Co may interrupt or curtail receipts of Producer’s Product and the Product of other producers as set forth herein. In such cases, Midstream Co shall have no liability to Producer (subject to Section 11.1(b) ) for its failure to receive Product, except to the extent such shutdown is caused by the negligence, gross negligence or willful misconduct of Midstream Co. If Midstream Co is required to so interrupt or curtail receipts of Product, Midstream Co will advise (by telephone, following up by writing, which writing may be in the form of electronic mail) Producer of such interruption or curtailment as soon as practicable or in any event within twenty-four hours after the occurrence of such event.

(b) Planned Curtailments and Interruptions .

(i) Midstream Co shall have the right to curtail or interrupt receipts and deliveries of Product for brief periods to perform necessary maintenance of and repairs or modifications (including modifications required to perform its obligations under this Agreement) to the Individual System; provided , however , that to the extent reasonably practicable, Midstream Co shall coordinate its maintenance, repair and modification operations with the operations of Producer and, in any case, will use its reasonable efforts to schedule maintenance, repair and modification operations so as to avoid or minimize to the greatest extent possible service curtailments or interruptions.

(ii) Midstream Co shall provide Producer (x) with 60 Days prior notice of any upcoming normal and routine maintenance, repair and modification projects that Midstream Co has planned that would result in a curtailment or interruption of Producer’s deliveries and the estimated time period for such curtailment or interruption and (y) with six Months prior notice of any maintenance (A) of which Midstream Co has knowledge at least six Months in advance and (B) that is anticipated to result in a curtailment or interruption of Producer’s deliveries for five or more consecutive Days.

(iii) On or before January 1, 2017, Midstream Co shall provide a schedule of the expected planned maintenance for the System for the subsequent 12 Months.

 

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Thereafter, on or before October 1 of each Year, starting October 1, 2017, Midstream Co shall deliver a schedule of the expected planned maintenance for the System for the subsequent 12 Months. The delivery of this plan is intended as a tool to assist the Parties in planning and does not replace the notices required in the foregoing clauses and in no way commits Midstream Co to adhere to the schedule set forth in such 12-Month plan.

Section 5.6 Transportation and Disposal . As between the Parties, Midstream Co shall make all necessary arrangements for the receipt, further transportation, and disposal of Producer’s owned and Controlled Product from the Receipt Points, to the Internal Transfer Points and ending at the Delivery Points.

Article 6

Fees

Section 6.1 Fees . Producer shall pay Midstream Co each Month in accordance with the terms of this Agreement for all Services provided by Midstream Co with respect to Dedicated Production received by Midstream Co from Producer or for Producer’s account during such Month, an amount, for each Individual System, equal to the sum of:

(i) the product of (x) the aggregate quantity of such Product, stated in Barrels, received by Midstream Co from Producer or for Producer’s account at the applicable Receipt Points for such Product within the applicable Individual System during such Month, multiplied by (y) the applicable Individual First Phase Rate (the “ Individual First Phase Fee ”); provided that if the Pipeline Unavailability arises as a result of action or inaction under the control of Midstream Co, then the Individual First Phase Fee shall not accrue with respect to the Trucked Volumes;

(ii) the Individual Second Phase Fee, if any, applicable to Second Phase Services performed within the Dedication Area,

(iii) an amount equal to Producer’s allocated portion of the actual costs incurred by Midstream Co for electricity required to provide Services, such allocation to be based upon the aggregate volumes of Product received by Midstream Co and

(iv) the Individual Disposal by Truck Fee, if any.

Section 6.2 Fee Adjustments .

(a) Redetermination .

(i) Redetermination Proposal . Between November 1 and December 31 of any Year, Midstream Co shall prepare and deliver to Producer for its review and comment a written proposal (each, a “ Redetermination Proposal ”) to redetermine each Individual Fee (unless the Parties mutually agree not to redetermine any particular Individual Fee) in accordance with this Section 6.2(a) . Each Redetermination Proposal shall include relevant supporting documentation based upon the latest updated Development Report and System Plan and shall take into account future items including, projected production volumes, operating revenue projections, and budgeted amounts for capital expenditures

 

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and all estimated operating expenses that Midstream Co believes will be necessary to provide the applicable Services as contemplated by the latest updated Development Report and System Plan; provided that a redetermined Individual Fee as agreed to by the Parties (a “ Redetermined Individual Fee ”) shall not recoup the difference between (A) estimated operating expenses or revenues and (B) actual operating expenses or revenues for periods prior to the effective date of such Redetermined Individual Fee. The Parties may agree to redetermine a particular Individual Fee without obligation to agree to redetermine any other Individual Fee.

(ii) Subsequent Redetermination Timing . Any Redetermined Individual Fee agreed to by the Parties on or prior to the last Business Day of February of the applicable Adjustment Year (“ Redetermination Deadline ”) shall become effective as of the first Day of the Month following the Month in which agreement has been reached. If the Parties fail to agree upon a redetermination of any Individual Fee set forth in the applicable Redetermination Proposal on or prior to the Redetermination Deadline, such Individual Fee shall remain in effect without redetermination pursuant to this Section 6.2(a) . For purposes of this Section 6.2(a)(ii) , the Year immediately after the Year during which a Redetermination Proposal is delivered is herein the “ Adjustment Year ”.

(b) Annual Escalation . Effective as of July 1 of each Year, the Individual Fee will be increased by multiplying the then-applicable Individual Fee by the Escalation Percentage (herein, the “ Increase in Fee ”) and adding the then-applicable Individual Fee to the Increase in Fee; provided that Reimbursed Amounts shall not be subject to this Section 6.2(b) . Such annual increase to the Individual Fee shall become effective on July 1 of the applicable Year, even if such Individual Fee was redetermined pursuant to Section 6.2(a) , with an effective date during the same Year.

(c) Downtime Events . If during any Month (as applicable, the “ Applicable Month ”), (i) one or more Downtime Events occur with respect to a Facility Segment, (ii) such Downtime Events caused the Downtime Percentage for such Facility Segment during the Applicable Month to exceed the lowest percentage specified on Exhibit B during such Month, and (iii) Producer has waived its right to a temporary release of Dedicated Production under Section 2.4(b)(ii) , then the Individual First Phase Fee for the applicable Facility Segment shall be reduced by the reduction percentage corresponding to the applicable Downtime Percentage on the chart on Exhibit B during each hour in which such Facility Segment is available to provide Services (an “ Operating Hour ”) during the subsequent Month until the reduced Individual First Phase Fee has been applied to an aggregate number of Operating Hours equal to the aggregate number of Downtime Hours during the Applicable Month. If the aggregate number of Operating Hours during the subsequent Month is less than the aggregate number of Downtime Hours during the Applicable Month, the applicable reduced Individual First Phase Fee shall be applied to Operating Hours during the next-subsequent Month or Months until the reduced Individual First Phase Fee has been applied to an aggregate number of Operating Hours equal to the aggregate number of Downtime Hours during the Applicable Month. A reduced Individual First Phase Fee that would otherwise apply during any Month subsequent to an Applicable Month shall not be applied until all Downtime Hours from previous Applicable Months have been addressed as provided in this Section 6.2(c) . At all times during which the Parties to this Agreement are also party to another Transaction Document that covers Crude Oil, Downtime Hours shall not accrue under this

 

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Agreement during the period of time in which a Downtime Event with respect to a Facility Segment connecting to a central facility on the System is occurring at the same time a Downtime Event with respect to a Facility Segment connecting to the same central facility on the Crude Oil Gathering System is occurring.

Section 6.3 Treatment of Byproducts, System Gains/Losses, Fuel and Related Matters . No separate fee shall be chargeable by Midstream Co and no refund or reduction in the Individual Fee shall be chargeable by or owed to Producer for the hydrocarbons or services described in this Section 6.3 .

(a) Reserved .

(b) Recovered Oil . Midstream Co shall deliver to Producer, each Month, all Recovered Oil allocated to Producer or for Producer’s account by delivering such Recovered Oil into the Crude Oil Gathering System. At all times during the Term, either (x) Midstream Co and Producer shall be a party to both this Agreement and another Transaction Document that covers Crude Oil (in which case Producer shall not owe any amount under this Agreement or any other Transaction Document to which Midstream Co is a Party as a result of Recovered Oil being transported through the Crude Oil Gathering System) or (y) the Parties shall set forth in the Agreement Addendum or an appropriate amendment to this Agreement the methodology for Midstream Co to deliver Recovered Oil to Producer and any fee applicable thereto.

(c) System Gains/Losses .

(i) Midstream Co will perform a Monthly material balance for each Individual System based on comparison of Product delivered and the amount of Product calculated to have been delivered into the Individual System (after removal of Recovered Oil) (in conjunction with determining the theoretical Crude Oil volume under any Transaction Document to which Midstream Co is a Party covering Crude Oil gathering services) received into the Individual System at Receipt Points. Actual gains or losses in an Individual System from the material balance will be allocated back to Producer’s Receipt Points to determine allocated quantities of Product received at Receipt Points for each Month.

(ii) If, during any Month, System Gains/Losses on an Individual System allocated to Producer in accordance with this Agreement exceeds 2.00% of the total quantities of Producer’s owned or Controlled Product delivered to the Individual System in such Month, then Midstream Co will, for the respective Individual System, obtain updated test data (i.e. sample results, meter proves, etc.) from Receipt Points involved in calculating the amount of Product determined to have been delivered into the Individual System (after removal of Recovered Oil) (in conjunction with determining the theoretical Crude Oil volume under any Transaction Document relating to the provision of crude oil gathering services by Midstream Co) and conduct a field-wide (on an Individual System basis) meter inspection and proving, if necessary, followed by an updated balance. If Midstream Co determines that a repair to the Individual System is needed to reduce the System Gains/ Losses below 2.00%, Midstream Co shall undertake such repairs in a commercially reasonable manner and as soon after making such determination as is commercially reasonable.

 

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(iii) Midstream Co shall provide Producer with prior notice of, and reasonable access to observe, any such field-wide meter balance.

(d) Other System Fuel . Midstream Co may elect to use Other System Fuel as fuel to operate the Individual System, or to generate electricity for the operation of the Individual System and shall account for any Other System Fuel used by Midstream Co. Producer, at its sole cost and expense, shall procure all fuel except diesel, in addition to Other System Fuel used by Midstream Co, if any, required to operate the Individual System or to generate electricity for the operation of the Individual System and arrange for transportation of such fuel to the Individual System.

Article 7

Quality Specifications

Section 7.1 Quality Specification . Subject to Section 7.2 , at no time shall Midstream Co be required to accept Product that is not produced from a Well within the Dedication Area. Subject to Section 7.2 , (a) Producer shall cause all Product delivered at the Receipt Points to Midstream Co to meet the quality specifications of the applicable Downstream Facility and (b) Midstream Co will not accept any Product unless it meets the quality specifications of the applicable Downstream Facility. If Producer’s Product delivered to the Receipt Points complies with such quality specifications, then all Product redelivered at the Delivery Points by Midstream Co to Producer shall meet the quality specifications of the applicable Downstream Facility. Producer shall not have the right to consent to any changes to the quality specifications of the applicable Downstream Facility or the quality specifications of any Downstream Facility not in existence as of the Effective Date. Midstream Co may commingle Product received into the Individual System with other Product shipments, and subject to Midstream Co’s obligation to redeliver to Producer at the Delivery Points Product that satisfies the applicable quality specifications of the Delivery Points, (i) such Product shall be subject to such changes in quality, composition and other characteristics as may result from such commingling and the removal of Recovered Oil (if any), and (ii) Midstream Co shall have no other obligation to Producer associated with changes in quality of Product as a result of such commingling and Recovered Oil removal.

Section 7.2 Failure to Meet Specifications . If any Product Tendered by Producer to the Individual System fails at any time to conform to the applicable specifications, then Midstream Co will have the right to discontinue receipt of such non-conforming Product. Unless such non-conforming Product creates a safety hazard or may damage existing infrastructure (in the opinion of Midstream Co), Midstream Co shall provide notice (which notice may be verbal initially, followed by written confirmation) to Producer twenty-four (24) hours prior to such discontinuation, and Producer shall cease delivery of Product until such time as the Product Tendered by Producer will again conform to the applicable specifications. If Producer fails to comply with the discontinuation notice (or deliver a formal dispute, as specified in the following sentence) prior to the expiration of twenty-four (24) hours after receiving such notice from Midstream Co, then, Midstream Co shall be entitled to unilaterally cease receiving Product. If

 

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Producer disputes Midstream Co’s determination that any Product fails to conform to the applicable specifications, then Producer shall (a) notify Midstream Co thereof within twenty-four (24) hours after receiving such notice from Midstream Co, (b) submit the applicable Product to a mutually agreed upon Third Party laboratory, and (c) cause such laboratory to analyze the Product within seventy-two (72) hours after Producer’s receipt of Midstream Co’s notice of non-conformance (during which time Midstream Co shall continue to accept deliveries from Producer, unless Midstream Co believes such deliveries present a safety hazard or may damage installed infrastructure). If the results of such analysis provide that the applicable Product is non-conforming, the costs and expenses associated with such analysis shall be borne by Producer; if the results of such analysis provide that the applicable Product conforms to the specifications, then Midstream Co shall reimburse Producer for all reasonable and documented costs and expenses incurred by Producer to cause such Third Party laboratory to perform such analysis. Producer will promptly undertake commercially reasonable measures to eliminate the cause of such non-conformance. Midstream Co, in its sole discretion, may accept receipt, or continue to receive, non-conforming Product if the blending and commingling of such Producer’s non-conforming Product with other Product in the Individual System does not materially affect the Individual System and the ability of Midstream Co to deliver Product at Delivery Point(s) within applicable Delivery Point specifications. Midstream Co’s continued taking of non-conforming Product shall not relieve Producer of the responsibility to undertake commercially reasonable measures to eliminate the cause of such non-conformance.

Section 7.3 Indemnification Regarding Quality . PRODUCER SHALL RELEASE, PROTECT, DEFEND, INDEMNIFY AND HOLD HARMLESS MIDSTREAM CO GROUP FROM AND AGAINST ALL LOSSES DIRECTLY OR INDIRECTLY ARISING OUT OF, IN CONNECTION WITH OR IN ANY MANNER ATTRIBUTABLE TO THE FAILURE OF THE PRODUCT DELIVERED BY PRODUCER TO THE INDIVIDUAL SYSTEM TO MEET THE QUALITY SPECIFICATIONS SET FORTH HEREIN, INCLUDING DISPOSAL COSTS, DAMAGE TO OR SUSTAINED BY THE INDIVIDUAL SYSTEM (INCLUDING THE EQUIPMENT AND COMPONENT PARTS), COSTS EXPENDED BY MIDSTREAM CO OR ANY OF ITS AFFILIATES TO RETURN THE INDIVIDUAL SYSTEM AND RELATED FACILITIES TO SERVICES, CLAIMS OF OTHER PRODUCERS ON THE INDIVIDUAL SYSTEM, AND CLAIMS OF OWNERS OF ALL DOWNSTREAM FACILITIES.

Article 8

Term

Section 8.1 Term . The term of this Agreement commenced on the Effective Date, and this Agreement shall remain in effect until the 16th anniversary of the Effective Date (the “ Initial Term ”) and thereafter on a Year to Year basis until terminated by Midstream Co or Producer effective upon the expiration of the Initial Term or the expiration of any Year thereafter upon notice no less than 90 Days prior to the expiration of the Initial Term or the expiration of any Year thereafter (such period of time, the “ Term ”).

Section 8.2 Effect of Termination or Expiration of the Term . Upon the termination of the Term, this Agreement shall forthwith become void and the Parties shall have no liability or obligation under this Agreement, except that (a) the termination of this Agreement shall not

 

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relieve any Party from any expense, liability or other obligation or remedy therefor that has accrued or attached prior to the date of such termination, (b) the provisions of Section 7.3 , this Section 8.2 , Article 15 and Section 17.1 through Section 17.10 shall survive such termination and remain in full force and effect indefinitely, (c) the indemnities set forth in Section 3.5(c) shall survive such termination and remain in full force and effect indefinitely, and (d)  Section 10.4 , Section 17.11 and Section 18.7 shall survive such termination and remain in full force and effect for the period of time specified in such Sections.

Article 9

Title and Custody

Section 9.1 Title . Delivery by Producer of Product to any Receipt Point shall be deemed a warranty of title to such Product by Producer or a warranty that Producer Controls the Product and has the right to deliver such Product for gathering under this Agreement, as applicable. Title to Product shall not transfer to Midstream Co by reason of Midstream Co’s performance of the Services.

Section 9.2 Custody . From and after Producer’s delivery of its owned or Controlled Product to Midstream Co at the Receipt Points, and until Midstream Co’s disposal of Product or redelivery of such Product to or for Producer’s account at the applicable Delivery Points, as between the Parties, Midstream Co shall have custody and control of, and be responsible for, such Product. In all other circumstances, as between the Parties, Producer shall be deemed to have custody and control of, and be responsible for, such Product.

Article 10

Billing and Payment

Section 10.1 Statements .

(a) Ordinary Course . Midstream Co shall submit invoices to Producer on or before the 25th Day after the end of a Month (the “ Invoice Month ”). Each invoice shall be accompanied by supporting information for all amounts charged by such invoice. All amounts owed for Services provided during an Invoice Month shall be reflected on the applicable invoice for such Invoice Month; provided that to the extent any amount appearing on an invoice is in respect of an amount paid by Midstream Co to a Third Party (collectively, the “ Reimbursed Amount ”) or the calculation of such amount is contingent on information provided by a Third Party (collectively, the “ Conditional Amount ”), such Reimbursed Amount and Conditional Amount shall be reflected on an invoice within 90 Days after the end of the Month in which such Reimbursed Amount was paid by Midstream Co.

(b) Reserved .

(c) Detail . Midstream Co shall cause its invoices and supporting information to include information reasonably sufficient to explain and support any estimates and charges reflected therein, the reconciliation of any estimates made in a prior Month to the actual measurements for such Month, and any adjustments to prior period volumes and quantities.

 

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(d) Monthly Loss/ Gain Report . Midstream Co shall deliver to Producer, on or before the close of business of the 40th Day after the applicable Invoice Month a Monthly Loss/ Gain Report. If Midstream Co elects, it may deliver such Monthly Loss/ Gain Report concurrently with the applicable invoice.

(e) One Invoice; Netting . To the extent that Midstream Co and Producer are party to this Agreement and one or more other Transaction Documents, one invoice may be delivered in respect of all amounts owing under such Transaction Documents. The Parties shall net all undisputed amounts due and owing or past due and owing arising under the Transaction Documents to which Producer and Midstream Co are parties such that the Party owing the greater amount shall make a single payment of the net amount to the other Party. No amounts owing to or by any Midstream Co may be set off against amounts owing to or by any other Midstream Co. No amounts owing to or by any Producer may be set off against amounts owing to or by any other Producer. To the extent possible, all fee adjustments set forth in Article 6 shall be accomplished by setoff or netting.

Section 10.2 Payments .

(a) Unless otherwise agreed by the Parties, all invoices under this Agreement shall be due and payable in accordance with each invoice’s instructions on or before the later of the 30th Day of each Month and the 10th Day after receipt of the invoice or, if such Day is not a Business Day, then on the next Business Day. All payments by Producer under this Agreement shall be made by electronic funds transfer to the account designated by Midstream Co. Any amounts not paid by the due date will be deemed delinquent and, with respect to amounts owed to Midstream Co, will accrue interest at the Interest Rate, such interest to be calculated from and including the due date but excluding the date the delinquent amount is paid in full.

(b) If Producer, in good faith, disputes the amount of any invoice of Midstream Co, Producer will pay Midstream Co such amount, if any, that is not in dispute and shall provide Midstream Co notice, no later than 30 Days after the date that payment of such invoice would be due under Section 10.2(a) , of the disputed amount accompanied by reasonable documentation to support Producer’s dispute. If Producer fails to provide notice of dispute within such 30-Day period, then Producer shall be deemed to have waived its right to dispute the applicable invoice, except for a dispute following an audit conducted in accordance with Section 10.4 . Following Midstream Co’s receipt of such dispute notice, Producer and Midstream Co shall endeavor in good faith to resolve such dispute, and if the Parties are unable to resolve such dispute within a reasonable time, such dispute may be resolved in accordance with Section 17.6 of this Agreement. Upon resolution of the dispute, any required payment shall be made within 15 Days after such resolution, and, if such amount shall be paid to Midstream Co, such amount shall be paid along with interest accrued at the Interest Rate from and including the due date but excluding the date paid

Section 10.3 Adequate Assurances . If (a) Producer fails to pay according to the provisions hereof and such failure continues for a period of 5 Business Days after written notice of such failure is provided to Producer, (b) Producer is not the Original Producer or (c) Midstream Co has reasonable grounds for insecurity regarding the performance by Producer of any obligation under this Agreement, then Midstream Co, by notice to Producer, may, singularly

 

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or in combination with any other rights it may have, demand Adequate Assurance of Performance from Producer. “Adequate Assurance of Performance” means, at the option of Producer, any of the following, (x) advance payment in cash by Producer to Midstream Co for Services to be provided under this Agreement in the following Month or (y) delivery to Midstream Co by Producer of an irrevocable standby letter of credit or a performance bond, in form and substance reasonably acceptable to Midstream Co, issued by a Credit-Worthy Person, in an amount equal to not less than the aggregate proceeds due from Producer under Section 10.1 for the prior 2-Month period. Promptly following the termination of the condition giving rise to Midstream Co’s reasonable grounds for insecurity or payment in full of amounts outstanding, as applicable, Midstream Co shall release to Producer the cash, letter of credit, bond or other assurance provided by Producer (including any accumulated interest, if applicable, and less any amounts actually applied to cover Producer’s obligations hereunder) .

Section 10.4 Audit . Each Party has the right, at its sole expense and during normal working hours, to examine the records of the other Party to the extent reasonably necessary to verify the accuracy of any statement, charge or computation made pursuant to the provisions of the Transaction Documents. The scope of such examination will be limited to the 24 Months preceding the date such notice of audit, statement, charge or computation was presented. No Party may conduct more than one audit (taking all Transaction Documents to which Producer is a party together) of another Party during any Year (except that, if a Party is in default hereunder, additional audits may be conducted during the continuance of such default). If any such examination reveals any inaccuracy in any statement or charge, the necessary adjustments in such statement or charge and the payments necessitated thereby shall be made within 60 Days after resolution of the inaccuracy. This provision of this Agreement will survive any termination of this Agreement for the later of (a) a period of 24 Months from the end of the Year in which the date of such termination occurred or (b) until a dispute initiated within the 24 Month period is finally resolved, in each case for the purpose of such statement and payment objections.

Article 11

Remedies

Section 11.1 Suspension of Performance; Temporary Release from Dedication .

(a) Suspension by Midstream Co as Remedy for Payment Default . If Producer fails to pay any invoice rendered under Article 10 , such failure is not due to a good faith dispute by Producer in accordance with Section 10.2(b) and such failure is not remedied within 5 Business Days after Producer’s receipt of written notice of such failure from Midstream Co, Midstream Co shall have the right, at its sole discretion, to (i) suspend performance (including withholding any payments that are owed by Midstream Co to Producer, and such withheld amounts shall not be subject to setoff under Section 10.1(e) ) under this Agreement until such amount, including interest at the Interest Rate, is paid in full or (ii) continue performing the Services under this Agreement, and, acting in a commercially reasonable manner, sell any Product delivered by Producer to the Receipt Points on Producer’s behalf, and use the proceeds therefrom to reimburse Midstream Co for any amounts due and owing to Midstream Co, and, at Producer’s election, either (y) remit any excess amounts received under such sale to Producer or (z) reduce the Services Fee due from Producer to Midstream Co for the following Month by the amount of such excess.

 

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(b) Additional Suspensions as Remedies . If a Party fails to perform or comply with any material warranty, covenant or obligation (other than as provided in Section 11.1(a) or Section 2.4(a)(i) ) contained in this Agreement and such failure has not been remedied within 60 Days after its receipt of written notice from the other Party of such failure, then the non-defaulting Party shall have the right to suspend performance of its obligations under this Agreement that are affected by such failure or non-compliance (including withholding any payments that are owed to the other Party, and such withheld amounts shall not be subject to netting or setoff under Section 10.1(e) ); provided that Producer may not withhold any payments that are owed to Midstream Co for Services actually performed by Midstream Co. Original Producer’s failure to accurately track, calculate and timely provide support of the total Net Acres sold pursuant to Section 16.2(b)(ii) shall constitute a material breach of Original Producer’s obligations hereunder.

(c) Specific Performance and Declaratory Judgments . Damages in the event of breach of this Agreement by a Party hereto may be difficult, if not impossible, to ascertain. Therefore, each Party, in addition to and without limiting any other remedy or right it may have, will have the right to seek a declaratory judgment and 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 Party from pursuing any other rights and remedies at law or in equity that such Party may have.

Section 11.2 No Election . In the event of a default by a Party under this Agreement, the other Party shall be entitled in its sole discretion to pursue one or more of the remedies set forth in this Agreement, or such other remedy as may be available to it under this Agreement, at Law or in equity, subject, however, to the limitations set forth in Section 11.3 and Article 15 . No election of remedies shall be required or implied as the result of a Party’s decision to avail itself of a remedy under this Agreement.

Section 11.3 DIRECT DAMAGES . A PARTY’S DAMAGES RESULTING FROM A BREACH OR VIOLATION OF ANY REPRESENTATION, WARRANTY, COVENANT, AGREEMENT OR CONDITION CONTAINED IN THIS AGREEMENT OR ANY ACT OR OMISSION ARISING FROM OR RELATED TO THIS AGREEMENT SHALL BE LIMITED TO ACTUAL DIRECT DAMAGES AND SHALL NOT INCLUDE ANY OTHER LOSS OR DAMAGE, INCLUDING INDIRECT, SPECIAL, CONSEQUENTIAL, INCIDENTAL, EXEMPLARY OR PUNITIVE DAMAGES, INCLUDING LOST PROFITS, PRODUCTION, OR REVENUES, AND EACH PARTY RELEASES THE OTHER PARTY FROM ALL SUCH CLAIMS FOR LOSS OR DAMAGE OTHER THAN ACTUAL DIRECT DAMAGES; PROVIDED THAT THIS LIMITATION TO DIRECT DAMAGES SHALL NOT LIMIT THE PARTIES’ INDEMNIFICATION OBLIGATIONS UNDER Section 3.5(c) , Section 7.3 , AND Article 15 .

 

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Article 12

Force Majeure

Section 12.1 Force Majeure . If either Midstream Co or Producer is rendered unable by an event of Force Majeure to carry out, in whole or part, its obligations under this Agreement and such Party gives notice (which notice may initially be delivered orally so long as written notice is delivered as soon as reasonably practicable thereafter) and reasonably full details of the event (including the nature, extent, effect, and likely duration of the event or circumstances constituting the Force Majeure event) to the other Party as soon as practicable after the occurrence of the event, then, during the pendency of such Force Majeure, but only during that period, the obligations of the Party affected by the event shall be canceled or suspended, as applicable, to the extent required; provided , however , that notwithstanding anything in the foregoing to the contrary, no Party shall be relieved from any indemnification obligation or any obligation to make payments, as the result of Force Majeure, regardless of which Party is affected; provided further that if the Force Majeure impacts only a particular Facility Segment or Individual System, then the suspension of obligations described in this sentence shall apply only to the applicable Facility Segment or Individual System and not to the obligations owing in connection with the rest of the System. The Party affected by Force Majeure shall use commercially reasonable efforts to remedy the Force Majeure condition with all reasonable dispatch, shall give notice to the other Party of the termination of the Force Majeure, and shall resume performance of any suspended obligation promptly after termination of such Force Majeure.

Section 12.2 Extension Due to Force Majeure . If a Party is unable to meet any deadline set forth herein as a result of a Force Majeure, then provided that such Party complies with the provisions of Section 12.1, such deadline shall be extended for a period of time equal to the period of time during which such Party is delayed due to the Force Majeure.

Article 13

Change in Law; Uneconomic Service

Section 13.1 Changes in Applicable Law .

(a) If any new Laws are enacted or amended or any new interpretations in respect of previously existing Laws are issued after the Effective Date that require Midstream Co to make capital expenditures with respect to the System, then Midstream Co may propose an increase to the applicable Individual Fee as may be necessary or appropriate to preserve and continue for the Parties the rights and benefits originally contemplated for the Parties by this Agreement; provided, however , that no increase to the applicable Individual Fee pursuant to this Section 13.1 shall be applicable unless and until, in the reasonable judgment of Midstream Co, Midstream Co would be required to make capital expenditures with respect to the System in order to comply with such new Law that materially and adversely affects the economics of the Services provided, fees received, or the other economic benefits of this Agreement for Midstream Co.

(b) Producer shall accept or reject, in its sole discretion, Midstream Co’s proposed increase to the Individual Fee within 30 Days after receiving such proposal from Midstream Co. If Producer fails to provide notice of such acceptance or rejection within such 30-Day period,

 

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then Producer shall be deemed to have accepted such increase. If Producer rejects the amount of the proposed increase, then Midstream Co shall release the Wells, Separator Facilities, Receipt Points, Spacing Units, and Dedicated Production that would have been affected by such increase in accordance with Section 2.4(a)(viii) . The Parties will amend, update, or revise the applicable Agreement Addendum in accordance with this Agreement to reflect any changes in the applicable Individual Fees agreed to in accordance with this Section 13.1 .

(c) Producer and Midstream Co shall use their commercially reasonable efforts to comply with new and amended applicable Laws and new interpretations of existing Laws.

Section 13.2 Unprofitable Operations and Rights of Termination .

(a) Cessation of Services . If, in the sole discretion of Midstream Co, (x) the gathering of Product from any Wells, Separator Facilities or Receipt Points, (y) the delivery of Product to any Delivery Points or (z) the provision of any other Service under this Agreement, is or becomes uneconomical due to its volume, quality, or for any other cause, then Midstream Co shall not be obligated to provide the applicable Services so long as such condition exists.

(i) If Midstream Co suspends Services under this Section 13.2(a) as a result of Producer’s (A) negligence, willful misconduct, or breach of this Agreement, (B) delivery of Product that fails to meet the quality specifications required by Section 7.1 , or (C) execution of a plan of development that deviates from the then-applicable Development Report, then Midstream Co may resume providing such Services at any time, upon two months’ advance written notice delivered to Producer, and the affected Wells, Separator Facilities, Receipt Points and Dedicated Production shall only be permanently released as a result of suspension under this clause by mutual agreement of the Parties under Section 2.4(a)(iv) .

(ii) If Midstream Co suspends Services under this Section 13.2(a) for any reason other than as specified in clause (i) above and (x) such suspension continues for six consecutive Months or (y) Midstream Co delivers notice to Producer that such suspension shall be permanent, then the applicable Wells, Separator Facilities, Receipt Points, Spacing Units and Dedicated Production shall be permanently released as specified in Section 2.4(a)(ix) .

(b) Election not to Expand System . If Midstream Co determines, in its discretion, that an expansion of the Individual System to satisfy the needs of Producer, as described in Section 3.2 hereof, would be uneconomical, then Midstream Co shall neither be obligated to undertake such expansion nor to provide the applicable Services. Producer shall be entitled to a release of the applicable Planned Wells, Planned Separator Facilities and Dedicated Production pursuant to Section 2.4(a)(ix) immediately upon Midstream Co’s delivery of a System Plan (marked as “Final”) indicating that a requested expansion would be uneconomical pursuant Section 13.2(d) .

(c) Start Date of Suspension of Services . Midstream Co shall cause any suspension of Services permitted by this Section 13.2 to commence on the first Day of a Month and not on any other Day.

 

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(d) Supporting Documentation and Management Discussions . As soon as Midstream Co determines that an expansion of the Individual System will not be economic or that continuing to provide Services at existing facilities has been rendered uneconomic, Midstream Co shall communicate the same to Producer.

(i) With respect to existing facilities, such notice shall be delivered to Producer at least 180 Days in advance of any proposed curtailment under this Section 13.2 and such notice shall be accompanied by documentation supporting its claim that certain Services have become uneconomical. Commencing on the date on which such notice is delivered and continuing for 180 Days, Midstream Co shall participate in Meetings of Senior Management if so requested by Producer, so long as such Meetings of Senior Management are scheduled at mutually agreeable times and locations, in order to negotiate a transition of Services that will not materially adversely affect Producer. Such discussions may include the following matters and such other matters aimed at ameliorating the detrimental effects of Midstream Co ceasing to provide Services: (A) purchase by Producer from Midstream Co of the pipe, rights of way or other assets necessary for the types of services that otherwise would have been performed under this Agreement, (B) a continuation of the provision of Services hereunder by Midstream Co for a period of time longer than the 180 Days required hereby in order to permit Producer sufficient time to take over operations or find an alternate midstream service provider and (C) adjustments to the Development Plan or rework certain Wells in order to address the concerns of Midstream Co with respect to providing Services thereto. In no event shall Midstream Co’s obligation to be available for Meetings of Senior Management create an obligation on Midstream Co to continue providing services past the 180 Days required hereby, and Midstream Co is under no obligation to agree to any amendments to this Agreement or modifications to the Services provided in order to accommodate requests of Producer during such negotiations. However, both Parties have an obligation to negotiate in good faith during such discussions.

(ii) With respect to planned facilities, Midstream Co shall indicate that providing Services to Planned Wells or Planned Separator Facilities is uneconomical by failing to include the necessary expansion projects in the applicable System Plan and shall provide supporting documentation for its determination that such expansion would be uneconomical, if requested by Producer. If Midstream Co delivers a System Plan (marked as “Final”) describing the necessary expansion projects, such delivery shall be deemed to be a commitment by Midstream Co to complete such expansion without exercising its rights under Section 13.2(b) , so long as conditions (including anticipated throughput, pricing, the ability to obtain rights-of-way, Producer’s continued execution of the Development Report, and any other factors deemed material by Midstream Co) do not materially change; provided, however that upon the initiation of Services through such expansion project or through a component part of such expansion project, such expansion (or applicable portion thereof) shall be considered “existing facilities” for purposes of this Section 13.2 and Midstream Co shall have all of the rights set forth herein with respect to existing facilities that become uneconomical. Nothing in this Section 13.2(d) shall give Producer a right to consent to a suspension under this Section 13.2 .

 

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(e) No Obligation to Drill or Operate . Without limiting the right of Producer to revise the Development Report to eliminate any proposed Wells or Separator Facilities, nothing herein shall be construed to require Producer to drill any Well, to continue to operate any Well, to place any new Separator Facility into service or to maintain the operation of any Separator Facility that a prudent operator would not in like circumstances drill or continue to operate.

Article 14

Reserved

Article 15

Indemnification and Insurance

Section 15.1 Reciprocal Indemnity . To the fullest extent permitted by applicable Law and except as otherwise set forth in Section 3.5(c) and Section 7.3 :

(a) Producer Indemnification . Producer shall release, protect, defend, indemnify and hold harmless Midstream Co Group from and against all Losses directly or indirectly arising out of or in connection with bodily injury, death, illness, disease, or loss or damage to property of Producer or any member of Producer Group in any way arising out of or relating to this Agreement, directly or indirectly. THIS RELEASE, DEFENSE AND INDEMNITY OBLIGATION SHALL APPLY REGARDLESS OF FAULT OF MIDSTREAM CO GROUP OR ANY OTHER PERSONS.

(b) Midstream Co Indemnification . Midstream Co shall release, protect, defend, indemnify and hold harmless Producer Group from and against all Losses directly or indirectly arising out of or in connection with bodily injury, death, illness, disease, or loss or damage to property of Midstream Co or any member of Midstream Co Group in any way arising out of or relating to this Agreement, directly or indirectly. THIS RELEASE, DEFENSE AND INDEMNITY OBLIGATION SHALL APPLY REGARDLESS OF FAULT OF PRODUCER GROUP OR ANY OTHER PERSONS.

(c) Regardless of Fault . AS USED IN THE PRECEDING TWO SUBCLAUSES, THE PHRASE “REGARDLESS OF FAULT” SHALL MEAN, WITH RESPECT TO ANY LOSS THAT IS CAUSED IN WHOLE OR IN PART BY THE NEGLIGENCE (WHETHER SOLE, JOINT, CONCURRENT, COMPARATIVE, CONTRIBUTORY, ACTIVE, PASSIVE, OR OTHERWISE), STRICT LIABILITY, OR OTHER FAULT, OF ANY MEMBER OF MIDSTREAM CO GROUP OR THE PRODUCER GROUP, WITHOUT REGARD TO THE CAUSE OR CAUSES THEREOF AND WITHOUT LIMITATION OF SUCH LOSS AND WHETHER OR NOT CAUSED BY A PRE-EXISTING CONDITION.

Section 15.2 Indemnification Regarding Third Parties . Each Party shall release, protect, defend, indemnify and hold the other Party harmless against any Loss by a Third Party that is not a member of the Producer Group or Midstream Co Group, to the extent such Loss (a) is caused by the negligence or willful misconduct of said indemnifying Party or such Party’s Group, or (b) in the case of Producer as indemnifying Party, results from claims by a Third Party of title, rights, or encumbrances in or to Product delivered by Producer to a Receipt Point.

 

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Section 15.3 Penalties . Producer shall release, protect, defend, indemnify, and hold harmless Midstream Co from any Losses resulting from penalties imposed by a Downstream Facility in any transportation contracts or service agreements associated with, or related to, Producer’s owned or Controlled Product.

Section 15.4 Insurance . Midstream Co and Producer shall (a) carry and maintain no less than the insurance coverage set forth in Exhibit D , and (b) cause such insurance to be (i) the primary coverage without any right of contribution from any other insurance held by the other Party to the extent of the insured Party’s indemnification obligations hereunder, and (ii) written and endorsed to include waivers of all subrogation rights of the insurers against Midstream Co and its Group (in the case of Producer’s insurance) or Producer and its Group (in the case of Midstream Co’s insurance). Unless Producer is Original Producer, Producer shall also cause the insurance carried and maintained by it pursuant to this Section 15.4 to be endorsed to name Midstream Co and its Group as additional insureds or provide blanket additional insured status that covers Midstream Co and its Group as additional insureds, except in the case of worker’s compensation insurance. Any insurance provided by OpCo on behalf of Midstream Co that comports with this Section 15.4 shall be deemed to satisfy these requirements.

Article 16

Assignment

Section 16.1 Assignment of Rights and Obligations under this Agreement .

(a) Assignment . Except as specifically otherwise provided in this Agreement, no Party shall have the right to assign its rights and obligations under this Agreement (in whole or in part) to another Person except with the prior consent of Midstream Co (in the case of an assignment by Producer) or Producer (in the case of an assignment by Midstream Co), which consent may be withheld at such Party’s sole discretion. Notwithstanding the foregoing, Producer may assign its rights and obligations under this Agreement to any Person to whom Producer assigns or transfers an interest in any of the Dedicated Properties insofar as this Agreement relates to such Dedicated Properties without the consent of Midstream Co; provided that (A) such Person assumes in writing the obligations of Producer under this Agreement insofar as it relates to the portion of the Dedicated Properties so assigned or transferred, such writing shall take the form of an Agreement Addendum, executed by the applicable Midstream Co and the Producer Assignee (and others, if appropriate) and such writing shall be recorded in the real property records of the counties in which the Dedication Area is located, (B) such assignment is made subject to this Agreement, (C) if such assignment or transfer is made to an Affiliate of Producer, the Original Producer shall not be released from any of its obligations under this Agreement, and (D) if such transfer or assignment is to a Producer Assignee (a “ Third Party Assignment ”): (1) the Original Producer shall be released from its obligations under this Agreement with respect to the Dedicated Properties so assigned or transferred, (2) at least thirty (30) Days prior to the closing date of the Third Party Assignment (or, if the period between signing and closing is less than thirty (30) Days, as early as possible and in no event less than two Business Days prior to the closing of the Third Party Assignment), Producer shall cause the proposed Producer Assignee to deliver an updated Development Report to Midstream Co and (3) prior to or on the closing date of the Third Party Assignment, the Producer Assignee shall deliver to Midstream Co (x) a copy of the writing pursuant to which the Third Party Assignment is occurring, and (y) documentation of any Conflicting Dedication affecting any Product of the Producer Assignee that would otherwise be considered Dedicated Production.

 

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(b) Notice; Binding Effect . Within 30 Days prior to the date of execution of a permitted assignment by Producer, Producer shall give Midstream Co notice of any assignment of this Agreement or Dedicated Properties. Midstream Co shall give Producer written notice of any assignment of this Agreement within 30 Days after the date of execution of such permitted assignment. This Agreement shall be binding upon and inure to the benefit of the respective permitted successors and assigns of the Parties. Any attempted assignment made without compliance with the provisions set forth in this Section 16.1 shall be null and void ab initio .

(c) Releases not Assignments . Any release of any of the Dedicated Properties from the Dedications pursuant to Section 2.4 shall not constitute an assignment or transfer of such Dedicated Properties for the purposes of this Article 16 .

Section 16.2 Pre-Approved Assignments .

(a) Each Party shall have the right without the prior consent of the others to (i) mortgage, pledge, encumber or otherwise impress a lien or security interest upon its rights and interest in and to this Agreement, and (ii) make a transfer pursuant to any security interest arrangement described in (i) above, including any judicial or non-judicial foreclosure and any assignment from the holder of such security interest to another Person.

(b) Original Producer (but not any subsequent Producer) may Transfer Dedicated Properties free of the terms, conditions and obligations of this Agreement in a Transfer:

(i) where such Transfer is an exchange of undeveloped Dedicated Properties (the “ Outbound Acreage ”) for properties of a Third Party located in the Dedication Area, which such properties become subject to the Dedications under this Agreement; provided that Producer shall reimburse Midstream Co in full for all actual costs and expenses incurred by Midstream Co to install, build, construct, or otherwise place into service infrastructure for the Outbound Acreage, so long as Midstream Co had informed Producer of its intention to install, build, construct or otherwise place into service the applicable infrastructure by inclusion of the same in a System Plan delivered prior to the closing of the applicable Transfer; or

(ii) where such Transfer (x) is not of the type described in Section 16.2(b)(i) , (y) pertains solely to Dedicated Properties outside of the boundary shown on Annex A to Midstream Addendum 07, and (z) would not cause the number of Net Acres of Dedicated Properties Transferred pursuant to this Section 16.2(b)(ii) during the Term of this Agreement, on an aggregate basis, to exceed 3,500 Net Acres. Original Producer shall be responsible for tracking the total acreage sold under this Section 16.2(b)(ii) and the number of Net Acres Transferred beginning on the Effective Date and continuing through the end of the Term and shall, upon request of Midstream Co, provide evidence supporting Original Producer’s calculation thereof.

Section 16.3 Change of Control . Except as provided in Section 16.1 , nothing in this Article 16 shall prevent Producer’s members or owners from transferring their respective

 

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interests (whether equity or otherwise and whether in whole or in part) in Producer and nothing in this Article 16 shall prevent Midstream Co’s members or owners from transferring their respective interests (whether equity or otherwise and whether in whole or in part) in Midstream Co. However, if a change of control of a Party gives rise to a reasonable basis for insecurity on the part of the other Party, such change of control may be the basis for a request of Adequate Assurance of Performance. Each member or owner of Producer or Midstream Co, as applicable, shall have the right to assign and transfer such member’s or owner’s interests (whether equity or otherwise and whether in whole or in part) in Producer or Midstream Co, as applicable, without restriction contained in this Agreement.

Article 17

Other Provisions

Section 17.1 Relationship of the Parties . The execution and delivery of an Agreement Addendum shall create a binding agreement between the Parties signatory thereto, consisting of the terms set forth in such Agreement Addendum together with the terms set forth in these Agreement Terms and Conditions. The signatories of one Agreement Addendum shall not be bound to or otherwise in privity of contract with the signatories of any other Agreement Addendum, and the execution and delivery of each Agreement Addendum shall form a separate and distinct contract. This Agreement shall not be deemed or construed to create, a partnership, joint venture or association or a trust between Producer and Midstream Co or the persons party to any other Agreement Addendum. This Agreement shall not be deemed or construed to authorize any Party to act as an agent, servant or employee for any other Party for any purpose whatsoever except as explicitly set forth in this Agreement. In their relations with each other under this Agreement, the Parties shall not be considered fiduciaries.

Section 17.2 Notices . Unless otherwise specified in the applicable provision, all notices, consents, approvals, requests, and other communications required or permitted to be given under this Agreement shall be in writing and delivered personally, or sent by bonded overnight courier, mailed by U.S. Express Mail or by certified or registered United States Mail with all postage fully prepaid, return receipt requested, or, except in the case of notices of breach or default, sent by electronic mail (including with a PDF of the notice or other communication attached), in each case, addressed (i) if to Producer, at the address set forth on the applicable Agreement Addendum and (ii) if to Midstream Co, at the address set forth on the applicable Agreement Addendum; provided that in the case of any notice by electronic mail, such notice is confirmed by communication via another method permitted by this Section 17.2 . Any notice, consent, approval, request, or other communication (“ Communications ”) given in accordance herewith shall be deemed to have been given when (a) actually received or rejected by the addressee in person or by courier, (b) ( reserved ), or (c) actually received or rejected by the addressee upon delivery by overnight courier or United States Mail, as shown in the tracking report or return receipt, as applicable. Communications may not be transmitted by electronic mail, except for ordinary course business communications that shall be deemed to be received, if transmitted during normal business hours on such Business Day, or if transmitted after normal business hours, on the next Business Day. Any Person may change their contact information for notice by giving notice to the other Party in the manner provided in this Section 17.2 .

 

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Texas Produced Water Services Agreement


Section 17.3 Entire Agreement; Conflicts . This Agreement (consisting of these Agreement Terms and Conditions and the applicable Agreement Addendum) constitutes the entire agreement of Producer and Midstream Co pertaining to the subject matter hereof and supersedes all prior agreements, understandings, negotiations, and discussions, whether oral or written, of Producer and Midstream Co pertaining to the subject matter hereof. There are no warranties, representations, or other agreements between Producer and Midstream Co relating to the subject matter hereof except as specifically set forth in this Agreement, including the exhibits hereto, and no Party shall be bound by or liable for any alleged representation, promise, inducement, or statements of intention not so set forth.

Section 17.4 Waivers; Rights Cumulative . Any of the terms, covenants, or conditions hereof may be waived only by a written instrument executed by or on behalf of the Person waiving compliance. No course of dealing on the part of any Party, or their respective officers, employees, agents, or representatives, nor any failure by a Party to exercise any of its rights under this Agreement shall operate as a waiver thereof or affect in any way the right of such Party at a later time to enforce the performance of such provision. No waiver by any Party of any condition, or any breach of any term or covenant contained in this Agreement, in any one or more instances, shall be deemed to be or construed as a further or continuing waiver of any such condition or breach or a waiver of any other condition or of any breach of any other term or covenant. The rights of Producer and Midstream Co under this Agreement shall be cumulative, and the exercise or partial exercise of any such right shall not preclude the exercise of any other right.

Section 17.5 Amendment .

(a) This Agreement may be amended only by an instrument in writing executed (except as otherwise set forth in this Section 17.5 ) by Producer and Midstream Co and expressly identified as an amendment or modification.

(b) In the event of a conflict between (i) these Agreement Terms and Conditions or any exhibit to this agreement, on the one hand, and (ii) an applicable Agreement Addendum, on the other, the applicable Agreement Addendum shall control.

Section 17.6 Governing Law; Arbitration . This Agreement shall be governed by and construed in accordance with the laws of the State, excluding any conflicts of law rule or principle that might refer construction of such provisions to the laws of another jurisdiction. Any dispute, controversy, or claim arising out of or relating to this Agreement shall be finally settled by arbitration in accordance with the CPR Institute for Dispute Resolution Rules for Non-Administered Arbitration then in effect (the “Rules”) by a sole arbitrator appointed in accordance with the Rules. The arbitrator is not empowered to award consequential, indirect, special, punitive or exemplary damages, and each Party irrevocably waives any damages in excess of actual damages. Arbitration shall be held in the English language in the State, and the decision of the arbitration panel shall include a statement of the reasons for such decision, and the award shall be final and binding on Producer and Midstream Co. Awards shall be final and binding on Producer and Midstream Co from the date they are made and judgment upon any award may be entered in any court having jurisdiction. The arbitrator shall apply the laws of the State, excluding any conflicts of law rule or principle that might refer construction of such provisions to the laws of another jurisdiction.

 

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Section 17.7 Parties in Interest . Except for parties indemnified hereunder, nothing in this Agreement shall entitle any Person other than the Parties to any claim, cause of action, remedy or right of any kind.

Section 17.8 Preparation of Agreement . The Parties and their respective counsel participated in the preparation of this Agreement. In the event of any ambiguity in this Agreement, no presumption shall arise based on the identity of the draftsman of this Agreement.

Section 17.9 Severability . If any term or other provision of this Agreement is invalid, illegal, or incapable of being enforced by any rule of Law or public policy, all other conditions and provisions of this Agreement shall nevertheless remain in full force and effect so long as the economic or legal substance of the transactions contemplated hereby is not affected in any adverse manner to any Party. Upon such determination that any term or other provision is invalid, illegal, or incapable of being enforced, Producer and Midstream Co shall negotiate in good faith to modify this Agreement so as to effect the original intent of Producer and Midstream Co as closely as possible in an acceptable manner to the end that the transactions contemplated hereby are fulfilled to the extent possible. A ruling of invalidity, illegality or unenforceability as to one Agreement shall only be applicable to that Agreement, not all the Agreements covered by these Agreement Terms and Conditions.

Section 17.10 Counterparts . This Agreement may be executed in any number of counterparts, and each such counterpart hereof shall be deemed to be an original instrument, but all of such counterparts shall constitute for all purposes one agreement. Any signature hereto delivered by a Party by electronic mail shall be deemed an original signature hereto; provided that the originals of any such electronically provided signatures shall be provided by the signatory, if requested by the other Party within a week of exchanging signatures.

Section 17.11 Confidentiality . All data and information exchanged by the Parties (other than the terms and conditions of this Agreement) and all pricing terms shall be maintained in strict and absolute confidence and no Party shall disclose, without the prior consent of the other Parties, any such data, information or pricing terms unless the release thereof is required by Law (including any requirement associated with an elective filing with a Governmental Authority) or the rules or regulations of any stock exchange on which any securities of the Parties or any Affiliates thereof are traded. Nothing in this Agreement shall prohibit the Parties from disclosing whatever information in such manner as may be required by Applicable Law; nor shall any Party be prohibited by the terms hereof from disclosing information acquired under this Agreement to any financial institution or investors providing or proposing financing to a Party or to any Person proposing to purchase the equity in any Party or the assets owned by any Party. Notwithstanding the foregoing, the restrictions in this Section 17.11 will not apply to data or information that (i) is in the possession of the Person receiving such information prior to disclosure by the other Party, (ii) is or becomes known to the public other than as a result of a breach of this Agreement or (iii) becomes available to a Party a non-confidential basis from a source other than the other Party, provided that such source is not bound by a confidentiality agreement with, or other fiduciary obligations of confidentiality to, the other Party. This Section will survive any termination of this Agreement for a period of 24 Months from the end of the Year in which the date of such termination occurred.

 

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Texas Produced Water Services Agreement


Article 18

Pipeline Unavailability

Section 18.1 Effectiveness; Pipeline Unavailability . The Parties agree that this Article 18 shall be effective as of the Trucked Water Services Commencement Date.

(a) It is the intention of the Parties to use the Individual System for all Dedicated Production. To accommodate operational upsets and periods of increased flow (such as the occurrence of Pre-Connection Water during the Pre-Connection Period), the Parties have agreed under Section 2.3(b) that, during Pipeline Unavailability, Producer shall elect to either (i) exercise the Trucking Election or (ii) cease producing Dedicated Production until the end of the Pipeline Unavailability, as provided in Section 18.2 . To the extent Producer exercises its Trucking Election, this Article 18 shall govern with respect to the Trucked Volumes and the other matters set forth herein, rather than Articles 4 , 7 (other than Section 7.3 as it applies to Trucked Volumes delivered to a SWD Trucking Facility that fail to meet the quality requirements of Section 18.3(d) ) and 9 and Sections 5.1 , 5.2 , 5.3 , 5.4 , and 5.6 .

(b) The Parties agree that during Pipeline Unavailability, Producer shall not have the right to temporary services under Sections 3.3(a) and 3.3(b) of the Agreement or to a temporary release under Section 2.4(b)(ii) of the Agreement except to the extent that Midstream Co fails to provide Trucked Water Services.

(c) If Midstream Co fails to connect a Well or a Separator Facility to the Individual System by the On-Line Deadline, Producer may exercise its Trucking Election for the duration of the resulting Pipeline Unavailability, rather than exercising its right to a permanent release under Section 2.4(a)(i) and Section 2.4(a)(ii) . If Midstream Co fails to connect a Well or Separator Facility to the Individual System by the On-Line Deadline, but prior to such On-Line Deadline, the Parties have agreed that the connection of the Well or Separator Facility did not need to occur until after Pre-Connection Water has started flowing, then the resulting Pipeline Unavailability shall not entitle Producer to a permanent release under Section 2.4(a)(i) and Section 2.4(a)(ii) until such time as the agreed upon connection date has passed.

Section 18.2 Exercise of Trucking Election .

(a) If Producer expects a Well or Separator Facility to be completed prior to its connection to the Individual System, resulting in a Pipeline Unavailability, Producer shall give Midstream Co at least 72 hours’ advance notice that Dedicated Production is expected to be produced from the applicable Well or available at the applicable Separator Facility. After the applicable Well or Separator Facility is connected to the Individual System, following the Trucked Water Services Commencement Date, Midstream Co shall deliver notice to Producer of any Pipeline Unavailability pursuant to Section 5.5 .

(b) Once Producer or Midstream Co, as applicable, has delivered notice to the other Party that a Pipeline Unavailability is expected (or has occurred), Producer will inform Midstream Co whether Producer elects to exercise its Trucking Election or to cease producing

 

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Dedicated Production until the end of the Pipeline Unavailability. If Producer exercises the Trucking Election during the Pre-Connection Period, Producer shall coordinate with the water hauling trucks and arrange for transportation of the Dedicated Production to the SWD Trucking Facility at its sole cost and expense until the end of the Pre-Connection Period. At all other times during a Pipeline Unavailability, including when Pre-Connection Water is occurring after the expiration of the Pre-Connection Period, Midstream Co shall coordinate with the water hauling trucks and arrange for transportation of the Dedicated Production to the SWD Trucking Facility as part of the Trucked Water Services unless Producer has elected to cease producing Dedicated Production.

Section 18.3 Delivery of and Title to Trucked Volumes .

(a) Trucked Water Services Obligation . Upon the exercise of a Trucking Election, Midstream Co shall cause an Approved SWD Vendor to accept delivery of, take title to, store, handle and dispose of Dedicated Production that is delivered by truck to a SWD Trucking Facility. Upon the exercise of a Trucking Election, Midstream Co may, in its sole discretion, also accept delivery of, take title to, store, handle and dispose of other Product delivered by truck to a SWD Trucking Facility. The volumes that are actually delivered by truck shall be referred to as “ Trucked Volumes ”.

(b) Consistent Volumes . The Trucked Volumes delivered to the applicable SWD Trucking Facility shall be at a rate of delivery that is as uniform as reasonably possible in accordance with Producer’s drilling, completion, and frac schedule.

(c) Title and Custody . Title to and risk of loss to the Trucked Volumes and all contents thereof shall pass from Producer to Approved SWD Vendor when delivered into Approved SWD Vendor’s storage tanks at the SWD Trucking Facility, unless the Parties otherwise agree in writing.

(d) Quality . Producer represents and warrants that all Trucked Volumes delivered to an Approved SWD Vendor may lawfully be disposed of in Class II disposal wells. Midstream Co’s performance of Trucked Water Services for any Trucked Volumes that do not meet such requirement shall not relieve Producer from any liability for Producer’s breach of the foregoing representation and warranty nor serve as a waiver of any rights or remedies available to Midstream Co therefor.

(e) Prohibition on Skimming . The Party that coordinates the water hauling trucks shall direct the Transporter not to skim, transfer, sell, or otherwise remove hydrocarbons or Trucked Volumes from trucks after receipt by such Transporter and prior to such Trucked Volumes being received by the Approved SWD Vendor. If the Approved SWD Vendor alleges that the Trucked Volumes delivered appear to have been handled in a manner inconsistent with the foregoing sentence, Producer shall corporate with Midstream Co and the Approved SWD Vendor in a review and analysis and, if required by the Approved SWD Vendor, take corrective action in a timely manner. If Transporters engaged by Producer fail to comply with the directions received, then Midstream Co may direct Producer to use a different Transporter.

 

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Texas Produced Water Services Agreement


Section 18.4 Unavailability of a SWD Trucking Facility . If for any reason there is a disruption of receipts at the SWD Trucking Facility, the Parties shall work in good faith to find a mutually agreeable resolution. If for any reason Midstream Co receives reimbursements in respect of trucking as a result of an originally scheduled SWD Trucking Facility being unable to accept deliveries, Midstream Co shall disclose such reimbursements on the applicable invoice and pass through such reimbursements to Producer if Producer paid the costs of the applicable Transporter directly.

Section 18.5 Testing; Non-Conforming Product . If requested by Midstream Co, Producer shall obtain water samples for analyses and retain appropriate qualified personnel to conduct analyses following methodologies considered appropriate in the industry or shall permit Midstream Co to obtain such samples.

Section 18.6 Producer’s Grant of Access . Producer hereby grants to Midstream Co, and shall grant to each Transporter, without warranty of title, either express or implied, to the extent that it may lawfully and is contractually permitted to do so without the incurrence of additional expense, the rights of ingress and egress with respect to, and the right to access, all lands constituting Dedicated Properties for the purposes of (a) transporting Trucked Volumes, and (b) obtaining water samples as described in Section 18.5 .

Section 18.7 Information . Producer agrees that information it supplies to Midstream Co regarding anticipated volumes of Dedicated Production and Trucked Volumes may be shared with an Approved SWD Vendor to the extent required by the applicable Approved SWD Vendor to assist in planning and operations, and Producer agrees to provide additional information regarding anticipated volumes of Dedicated Production and Trucked Volumes to the extent requested by Midstream Co in response to inquiries from an Approved SWD Vendor (so long as Midstream Co is required to deliver the requested information in order to comply with Midstream Co’s contractual arrangements with such Approved SWD Vendor). Under Section 3.1 , Midstream Co has the right to hold certain meetings with Producer, and at the request of Midstream Co, one of such meetings per year may be held in conjunction with the Approved SWD Vendor to discuss confer regarding planned activities.

Section 18.8 Indemnification in Respect of Trucked Volumes . Without in any way limiting any indemnification obligation otherwise set forth in the Agreement, the Parties agree that the indemnification obligations of Producer set forth in Section 7.3 and Section 15.2(b) apply to Trucked Volumes delivered to a SWD Trucking Facility.

Section 18.9 Invoices from Approved SWD Vendor . The Party that engages the Transporter shall take all reasonable measures to ensure that the invoicing procedures that Midstream Co has negotiated with the Approved SWD Vendor are used, including notation of the geographic area to which the services pertain. Midstream Co shall provide a written copy of such procedures to Producer upon request.

(End of Agreement Terms and Conditions )

 

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Texas Produced Water Services Agreement


EXHIBIT A

TO TEXAS AGREEMENT TERMS AND CONDITIONS

RELATING TO PRODUCED WATER SERVICES

Reserved

 

Exhibit A - 1

Texas Produced Water Services Agreement


EXHIBIT B

TO TEXAS AGREEMENT TERMS AND CONDITIONS

RELATING TO PRODUCED WATER SERVICES

DOWNTIME FEE REDUCTION

 

Facility Segment Downtime Percentage

(per Month)

  Percentage Reduction of
Individual First Phase Fee with
respect to such Facility Segment

Greater than 4.5% and up to and including 10%

  5%

Greater than 10% and up to and including 12%

  10%

Greater than 12% and up to and including 15%

  15%

Greater than 15%

  20%

(End of Exhibit B)

 

Exhibit B - 1

Texas Produced Water Services Agreement


EXHIBIT C

TO TEXAS AGREEMENT TERMS AND CONDITIONS

RELATING TO PRODUCED WATER SERVICES

(Reserved)

 

Exhibit C - 1

Texas Produced Water Services Agreement


EXHIBIT D

TO TEXAS AGREEMENT TERMS AND CONDITIONS

RELATING TO PRODUCED WATER SERVICES

INSURANCE

Midstream Co and Producer shall (or, in the case of Midstream Co, Midstream Co may cause OpCo to) purchase and maintain in full force and effect at all times during the Term of this Agreement, at such Party’s sole cost and expense and from insurance companies that are rated (or whose reinsurers are rated) “A-VII” or better by AM Best or “BBB-” or better by Standard & Poor’s or an equivalent rating from another recognized rating agency, policies providing the types and limits of insurance indicated below, which insurance shall be regarded as a minimum and, to the extent of the obligations undertaken by such Party in this Agreement, shall be primary (with the exception of the Excess Liability Insurance and Workers’ Compensation) as to any other existing, valid, and collectable insurance. Each Party’s deductibles shall be borne by that Party.

 

  A. Where applicable, Workers’ Compensation and Employers’ Liability Insurance, in accordance with the statutory requirements of the State, and endorsed specifically to include the following:

 

  1. Employers’ Liability, subject to a limit of liability of not less than $1,000,000 per accident, $1,000,000 for each employee/disease, and a $1,000,000 policy limit.

The Workers’ Compensation and Employers’ Liability Insurance policy(ies) shall contain an alternate employer endorsement.

 

  B. Commercial General Liability Insurance, with limits of liability of not less than the following:

$2,000,000 general aggregate

$1,000,000 each occurrence, Bodily Injury or Property Damage Combined Single Limit

Such insurance shall include the following:

 

  1. Premises and Operations coverage.

 

  2. Contractual Liability covering the liabilities assumed under this Agreement.

 

  3. Broad Form Property Damage Liability endorsement, unless policy is written on November 1988 or later ISO form.

 

  4. Products and Completed Operations.

 

  5. Time Element Limited Pollution coverage.

 

Exhibit D - 1

Texas Produced Water Services Agreement


  C. If applicable, Automobile Liability Insurance, with limits of liability of not less than the following:

$1,000,000 Bodily Injury or Property Damage Combined Single Limit, for each occurrence.

Such coverage shall include hired and non-owned vehicles and owned vehicles where applicable.

 

  D. If applicable, Aircraft Liability Insurance. In any operation requiring the use or charter of aircraft or helicopters by Midstream Co or Producer, combined single limit insurance shall be carried or cause to be carried for public liability, passenger liability and property damage liability in an amount of not less than $8,000,000 per seat subject to a minimum of $20,000,000; this insurance shall cover all owned and non-owned aircraft, including helicopters, used by Midstream Co in connection with the performance of the work set forth in this Agreement.

 

  E. Excess Liability Insurance, with limits of liability not less than the following:

Limits of Liability - $10,000,000 Occurrence/Aggregate for Bodily Injury and Property Damage in excess of the coverage outlined in Paragraphs A, B, C and D.

The limits of coverage required in this Agreement may be met with any combination of policies as long as the minimum required limits are met.

Each Party to this Agreement shall have the right to acquire, at its own expense, such additional insurance coverage as it desires to further protect itself against any risk or liability with respect to this Agreement and operations and activities under this Agreement or related thereto. All insurance maintained by or on behalf of Producer or Midstream Co shall contain a waiver by the insurance company of all rights of subrogation in favor of the other Party.

Neither the minimum policy limits of insurance required of the Parties nor the actual amounts of insurance maintained by the Parties under their insurance program shall operate to modify the Parties’ liability or indemnity obligations in this Agreement.

A Party may self-insure the requirements in this Exhibit D if such Party is Controlled by Noble Energy, Inc. and, otherwise, if such Party or its parent is considered investment grade (S&P BBB- or equivalent or higher).

(End of Exhibit D)

 

Exhibit D - 2

Texas Produced Water Services Agreement

Exhibit 10.38

TERMS IN THIS EXHIBIT HAVE BEEN REDACTED BECAUSE CONFIDENTIAL TREATMENT FOR THOSE TERMS HAS BEEN REQUESTED. THE REDACTED MATERIAL HAS BEEN FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION, AND THE TERMS HAVE BEEN MARKED AT THE APPROPRIATE PLACE WITH TWO BRACKETED ASTERISKS [**].

TEXAS PRODUCED WATER SERVICES AGREEMENT

AGREEMENT ADDENDUM 01

P ERMIAN

C ONTRACT N UMBER : BLPR01-PW

This AGREEMENT ADDENDUM 01 (this “ Agreement Addendum ”) (a) shall be effective as among the Persons named below as “Producer” and “Midstream Co” as of the date specified below as the “Effective Date,” (b) incorporates the Texas Agreement Terms and Conditions Relating to Produced Water Services (the “ Agreement Terms and Conditions ”), which were last amended effective as of the Effective Date, and (c) together with the Agreement Terms and Conditions, shall constitute one contract and shall be the Agreement of the Parties. Except as otherwise set forth herein (i) all terms shall have the meanings assigned to such terms in the Agreement Terms and Conditions, and (ii) all references to Exhibits, Appendices, Articles, Sections, subsections and other subdivisions refer to the corresponding Exhibits, Appendices, Articles, Sections, subsections and other subdivisions of or to the Agreement Terms and Conditions.

Producer desires to contract with Midstream Co for Midstream Co to provide the Services utilizing the Individual System, and Midstream Co desires to provide the Services to Producer, on the terms and subject to the conditions of this Agreement.

NOW, THEREFORE, in consideration of the mutual agreements in this Agreement, Midstream Co and Producer hereby agree as follows:

 

Producer      Rosetta Resources Operating LP, a Delaware limited partnership
Midstream Co      Blanco River DevCo LP, a Delaware limited partnership
Parties      The term “Party” or “Parties” shall refer to Producer and Midstream Co identified in this Agreement Addendum
Effective Date      September 1, 2016

 

Agreement Addendum 01 – Page 1

Texas Produced Water Services Agreement

Permian


Dedication Area   

The following areas within Reeves County, Texas:

 

H&GNRR Block 5

H&GNRR Block 6

H&GNRR Block 13

 

PSL Block C18

PSL Block C10

PSL Block C9

PSL Block C8

PSL Block C7

PSL Block C6

 

T&P RR Block 51-T7

T&P RR Block 50-T7

Individual First Phase Rate    $[**]/ Barrel
Individual Second Phase Fee    [**].
Individual Disposal by Truck Fee    [**].

 

Notices and Payments

 

Notice Address – General Matters & Correspondence   

Midstream Co:

 

Midstream Co

c/o Noble Midstream Services, LLC

1001 Noble Energy Way

Houston, TX 77070

Attention: Chief Financial Officer

 

Producer:

 

Rosetta Resources Operating LP

c/o Noble Energy, Inc.

1001 Noble Energy Way

Houston, TX 77070

Attention: Director Revenue Accounting

 

Agreement Addendum 01 – Page 2

Texas Produced Water Services Agreement

Permian


Notice Address – Operational Matters   

Midstream Co:

 

Midstream Co

c/o Noble Midstream Services, LLC

1001 Noble Energy Way

Houston, TX 77070

Attention: Chief Operating Officer

 

Producer:

 

Rosetta Resources Operating LP

c/o Noble Energy, Inc.

1001 Noble Energy Way

Houston, TX 77070

Attention: Director Revenue Accounting

Notice Address – Force Majeure, interruptions and Pipeline Unavailability   

Midstream Co:

 

Midstream Co

c/o Noble Midstream Services, LLC

1001 Noble Energy Way

Houston, TX 77070

Attention: Chief Operating Officer

 

Producer:

 

Rosetta Resources Operating LP

c/o Noble Energy, Inc.

1001 Noble Energy Way

Houston, TX 77070

Attention: Director Revenue Accounting

 

Agreement Addendum 01 – Page 3

Texas Produced Water Services Agreement

Permian


Notice Address – Invoicing Matters   

Midstream Co:

 

Midstream Co

c/o Noble Midstream Services, LLC

1001 Noble Energy Way

Houston, TX 77070

Attention: Senior Accountant

 

Producer:

 

Rosetta Resources Operating LP

c/o Noble Energy, Inc.

1001 Noble Energy Way

Houston, TX 77070

Attention: Director Revenue Accounting

Payments by Electronic Funds Transfer   

Midstream Co:

 

ABA for wire: To be provided in writing prior to commencing Services

ABA for ACH: To be provided in writing prior to commencing Services

Account Number: 880285205

Account Name: Blanco River DevCo LP

Financial Institution: JP Morgan

Bank Swift: CHASUS33

 

Producer:

 

ABA/Routing Number: 021000021

Account Number: 700628402

Account Name: Rosetta Resources Operating LP

Financial Institution: JPMorgan Chase – New York

Bank Swift: CHASUS33

(End of Agreement Addendum 01)

 

Agreement Addendum 01 – Page 4

Texas Produced Water Services Agreement

Permian


IN WITNESS WHEREOF, the Parties hereto have executed this Agreement in duplicate originals to be effective as of the Effective Date.

“Producer”

 

ROSETTA RESOURCES OPERATING LP
  BY:   ROSETTA RESOURCES OPERATING GP, LLC,
  its general partner

 

By:  

/s/ Charles J. Rimer

Name:   Charles J. Rimer
Title:   President

 

STATE OF COLORADO    )  
   )   ss.
COUNTY OF DENVER                )  

The foregoing instrument was acknowledged before me this 25th day of August 2016, by Charles J. Rimer as President of Rosetta Resources Operating GP, LLC, a Delaware limited liability company, acting as the general partner of Rosetta Resources Operating LP, a Delaware limited partnership.

WITNESS my hand and official seal.

My commission expires: 03/17/2018

 

/s/ Christine Usher

Notary Public

 

Agreement Addendum 01 – Signature Page 1

Texas Produced Water Services Agreement

Permian


“Midstream Co”

BLANCO RIVER DEVCO LP

 

By:

 

Blanco River DevCo GP LLC

   

    By:

 

Noble Midstream Services, LLC

 

                                                  By:  

/s/ Terry R. Gerhart                                     

      Terry R. Gerhart
      Chief Executive Officer

 

STATE OF TEXAS    )  
   )   ss.
COUNTY OF HARRIS                )  

The foregoing instrument was acknowledged before me this 25th day of August 2016, by Terry R. Gerhart as Chief Executive Officer of Noble Midstream Services, LLC, in its capacity as sole member of Blanco River DevCo GP LLC, in its capacity as the general partner of Blanco River DevCo LP, a Delaware limited partnership.

WITNESS my hand and official seal.

My commission expires: 05/05/2018

/s/ Joanne Garner

Notary Public

 

Agreement Addendum 01 – Signature Page 2

Texas Produced Water Services Agreement

Permian