Exhibit 10.2
 
Execution Version

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ASSET PURCHASE AGREEMENT
 
 
by and between
 
 
WESTERN REFINING PIPELINE COMPANY, as Seller
 
 
and
 
 
PLAINS PIPELINE, L.P., as Buyer
 

 
 
Dated November 30, 2011
 

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TABLE OF CONTENTS
 
 Page
 
 
ARTICLE I
 
SALE AND PURCHASE OF ASSETS, ASSUMPTION OF LIABILITIES AND CONSIDERATION
 
 
1.1
Sale and Purchase of Assets
1
1.2
Excluded Assets
2
1.3
Assumption of Liabilities
3
1.4
Consideration
5
1.5
Pipeline Reactivation Adjustment
5
1.6
Adjustments to Purchase Price
5
1.7
Non-Assignment of Certain Acquired Assets
 
5
ARTICLE II
 
CLOSING
 
 
2.1
Closing
6
2.2
Deliveries by Seller
6
2.3
Deliveries by Buyer
8
2.4
Prorations.
8
2.5
Closing Costs; Transfer Taxes and Fees
 
9
ARTICLE III
 
REPRESENTATIONS AND WARRANTIES OF SELLER
 
 
3.1
Organization
10
3.2
Authorization
10
3.3
No Conflicts; Consents
10
3.4
Compliance With Laws and Permits
11
3.5
Absence of Litigation
11
3.6
Absence of Changes
11
3.7
Title to Acquired Assets
11
3.8
Contracts
12
3.9
Taxes
12
3.10
Employees
12
3.11
Environmental Matters
12
3.12
No Brokers or Finders
14
3.13
Sufficiency of Assets
14
3.14
Intellectual Property
14
3.15
WAIVERS AND DISCLAIMERS
14
3.16
Survival
 
15

 
 
 
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ARTICLE IV
 
REPRESENTATIONS AND WARRANTIES OF THE BUYER
 
4.1
Organization
15
4.2
Authorization
15
4.3
No Violations; Consents
16
4.4
Absence of Litigation
16
4.5
No Brokers and Finders
16
4.6
Due Diligence
16
4.7
Sufficient Funds
 
16
ARTICLE V
 
COVENANTS AND AGREEMENTS OF SELLER
 
5.1
Pre-Closing Access and Information
17
5.2
Conduct of Business
17
5.3
Schedules
 
18
ARTICLE VI
 
COVENANTS AND AGREEMENTS OF BUYER
 
6.1
Pre-Closing Access and Inspections
18
6.2
Post-Closing Preservation of Books and Records; Access
19
6.3
Cooperation for Retained Claims
20
6.4
Excluded Intellectual Property
20
6.5
Performance Bonds and Guaranties
20
6.6
Insurance
20
6.7
Crude Oil Purchasing Agreement
 
21
ARTICLE VII
 
COVENANTS AND AGREEMENTS OF SELLER AND BUYER
 
7.1
Expenses
21
7.2
Injunctions
21
7.3
Payments Received
21
7.4
[Reserved]
21
7.5
HSR Matters
21
7.6
Public Announcements
22
7.7
Confidentiality
22
7.8
Notice of Certain Events
22
7.9
Further Assurances
23
7.10
Tax Matters
23
7.11
Real Estate Matters
25
7.12
Casualty Loss
25
7.13
ROW
 
26

 
 
 
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ARTICLE VIII
 
[Reserved]
 
 
ARTICLE IX
 
CONDITIONS TO CLOSING
 
9.1
Conditions to Each Party’s Obligation to Close
27
9.2
Conditions to Buyer’s Obligation to Close
27
9.3
Conditions to Seller’s Obligation to Close
 
28
ARTICLE X
 
TERMINATION
 
10.1
Termination
29
10.2
Effect of Termination
 
29
ARTICLE XI
 
INDEMNIFICATION
 
11.1
Obligations to Indemnify
30
11.2
Third Party Claims
30
11.3
Direct Claims
31
11.4
Materiality
32
11.5
Limits of Liability
32
11.6
Survival of Covenants, Representations and Warranties
33
11.7
Exclusive Remedy
33
11.8
Payments
33
11.9
Administration of Indemnity Claims
 
33
ARTICLE XII
 
MISCELLANEOUS
 
12.1
Notices
34
12.2
Entire Agreement; Amendment; Waiver; Exhibits and Schedules
35
12.3
Severability
35
12.4
Parties in Interest
35
12.5
Governing Law
35
12.6
Assignment
36
12.7
Dispute Resolution
36
12.8
Specific Performance
38
12.9
Counterparts
38
12.10
Expenses
38
     

 
 
 
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Annex:
         
Annex A
-
Interpretation; Defined Terms
     
Exhibits:
         
Exhibit A
-
Leased Real Property Assignments
Exhibit B
-
Bill of Sale
Exhibit C
-
Assumed Contracts Assignment
Exhibit D
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Transition Services Agreement
Exhibit E
-
Closing Statement
Exhibit F
-
Purchase Price Receipt
Exhibit G
-
Custody Transfer Receipt
Exhibit H
-
Seller Guaranty
Exhibit I
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FIRPTA Affidavit
Exhibit J
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Notice
Exhibit K
-
Seller Certificate
Exhibit L
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Buyer Certificate
Exhibit M
-
Buyer Guaranty
Exhibit N
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ROW Assignment

 
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ASSET PURCHASE AGREEMENT
 
THIS ASSET PURCHASE AGREEMENT (this “Agreement”) dated as of November 30, 2011
(the “Agreement Date”), is made and entered into by and between Western Refining
Pipeline Company, a New Mexico corporation (“Seller”), and Plains Pipeline,
L.P., a Texas limited partnership (“Buyer”).  Seller and the Buyer shall
collectively be referred to herein as the “Parties” and each, a “Party.”
 
WHEREAS, Seller owns certain pipeline assets, which include an approximate 82
mile section of pipeline running from Section 1, T15S, R29E near Highway 249 in
Chaves County, New Mexico, to Jal Station in Lea County, New Mexico (the
“Pipeline”); and
 
WHEREAS, Seller desires to sell and assign to Buyer, and Buyer wishes to
purchase and assume from Seller, all the assets related to the Pipeline and
certain liabilities related thereto on the terms and conditions set forth
herein.
 
NOW, THEREFORE, in consideration of the mutual covenants, representations,
warranties and agreements contained herein, and of other good and valuable
consideration, the receipt and sufficiency of which are hereby acknowledged, and
intending to be legally bound hereby, the Parties hereto hereby agree as
follows:
 
ARTICLE I
SALE AND PURCHASE OF ASSETS, ASSUMPTION OF
LIABILITIES AND CONSIDERATION
 
1.1           Sale and Purchase of Assets.  At the Closing, subject to the terms
and conditions hereof, Seller shall sell, assign, transfer, convey and deliver
to Buyer, and Buyer shall purchase from Seller, free and clear of any Liens
(other than Permitted Liens), the Acquired Assets, and Buyer shall accept such
Acquired Assets.  As used herein, “Acquired Assets” shall mean, collectively,
the following (but shall specifically exclude the Excluded Assets):
 
(a)           Seller’s leasehold interests in the real property (as lessee or
sublessee) leased or subleased by Seller as set forth on Schedule 1.1(a),
together with Seller’s leasehold interest in and to all buildings, facilities,
fixtures, structures and improvements situated thereon (collectively, the
“Leased Real Property”) together with all amenities, rights and privileges
appurtenant or related thereto, including associated tanking, piping and
appurtenances at the Lynch Station and Jal Station used primarily and directly
in the operation of the Pipeline;
 
(b)           the tangible machinery, equipment, office equipment,
communications assets, computer hardware, furniture, furnishings, trailers,
tools, oil manifold assets, and similar personal property owned by Seller and
held by Seller for the operation of the Pipeline, including those items set
forth on Schedule 1.1(b) but specifically excluding the Excluded Personal
Property (collectively, the “Personal Property”);
 
(c)           all rights to Claims, refunds or adjustments with respect to the
Acquired Assets or the Assumed Liabilities for the period on or after the
Effective Time;
 
 
 

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(d)           to the extent assignable, all rights of the Seller and its
Affiliates (if applicable) under the Contracts in respect of the Business or the
Assumed Liabilities as set forth on Schedule 1.1(d) (collectively, the “Assumed
Contracts”);
 
(e)           original or true and complete copies (if no original is available)
of all of the books and records of Seller (or its Affiliates) that relate
exclusively to the Business or Assumed Liabilities (collectively, the “Books and
Records”);
 
(f)           to the extent assignable, the Intellectual Property of Seller that
is owned by Seller set forth on Schedule 1.1(f) (collectively, the “Assigned
Intellectual Property”); and
 
(g)           all of Seller’s right, title and interest in and to rights-of-way
to the extent used in the operations of the Pipeline or relating to the
Pipeline, including easements, licenses and use agreements described on Schedule
‎1.1‎(g) (“ROW Rights”).
 
1.2           Excluded Assets.  Notwithstanding anything to the contrary
contained in this Agreement, for the avoidance of doubt, Seller shall retain all
of its right, title and interest in and to the following assets, properties and
rights, and Seller shall not sell, assign, transfer, convey or deliver to Buyer
hereunder any of the following assets, properties or rights (collectively, the
“Excluded Assets”):
 
(a)           the tangible machinery, equipment, communications assets, computer
hardware, tools, oil manifold assets, and similar personal property owned or
leased by Seller and set forth on Schedule 1.2(a) (collectively, the “Excluded
Personal Property”);
 
(b)           all books and records of Seller i) the disclosure of which could
be inconsistent with any legal constraints or obligations regarding the
confidentiality thereof (unless Buyer agrees to be bound by the confidentiality
provisions related thereto) or constitute a waiver of any attorney-client, work
product or similar privilege; (ii) relating to prior litigation, or litigation
that is no longer applicable or pending; (iii) relating to the Excluded Assets
or the Retained Liabilities; (iv) containing any information about Seller or any
of its Affiliates that is unrelated to the Acquired Assets or the Assumed
Liabilities; (v) containing any information about Seller or any of its
Affiliates pertaining to project evaluation, price curves or projections or
other economic or predictive models; (vi) relating to income Taxes paid by
Seller or any of its Affiliates, except to the extent disclosed or required to
be disclosed with respect to any Tax Return related in any manner to the
Acquired Assets or the Assumed Liabilities; (vii) constituting organizational
documents of Seller; (viii) constituting minutes, seals, equity interest records
and other records of internal company proceedings of Seller; (ix) that Seller is
required to retain by Law (in which event, copies thereof shall be delivered to
Buyer); and (x) having been prepared in connection with, or relating in any way
to the transactions contemplated by this Agreement or any bids or offers
received from Buyer or any Third Parties and analyses relating in any way to the
sale of the Acquired Assets (collectively, the “Excluded Books and Records”);
 
(c)           all rights to Claims, refunds or adjustments with respect to the
Acquired Assets which relate to any period prior to the Effective Time and with
respect to the Excluded Assets, all other refunds or adjustments relating to any
Action with respect to the Excluded
 
 
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Assets, and with respect to the Acquired Assets those that relate to any period
prior to the Effective Time and all rights to insurance proceeds or other
insurance recoveries that ii) relate to, or are reimbursement for, Seller’s or
any Affiliate’s of Seller expenditures made prior to the Effective Time for
which insurance proceeds are available or due to Seller or such Affiliate with
respect to the Acquired Assets or iii) relate to Excluded Assets or Retained
Liabilities;
 
(d)           all of Seller’s cash and cash equivalents on hand and in bank
accounts;
 
(e)           all of Seller’s accounts receivable and audit rights relating
thereto arising under any of the applicable Contracts or otherwise with respect
to any of the Excluded Assets and, with respect to the Acquired Assets, for any
period prior to the Effective Time;
 
(f)           all of Seller’s net operating losses and Tax refunds relating to
the Excluded Assets, and with respect to the Acquired Assets, for any period
prior to the Effective Time;
 
(g)           all of Seller’s rights, title and interest in and to all posted
surety or performance bonds relating to the Acquired Assets, including those set
forth on Schedule 1.2(g) (the “Credit Support Instruments”);
 
(h)           all of Seller’s rights under the Contracts that are described and
set forth on Schedule ‎1.2(h) (collectively, the “Excluded Contracts”);
 
(i)           Seller’s Intellectual Property set forth on Schedule 1.2(i)
(collectively, the “Excluded Intellectual Property”);
 
(j)           all Permits related to Seller’s ownership or operation of the
Pipeline (the “Existing Permits”); and
 
(k)           with respect to any right of way which covers a portion of the
Pipeline and a portion of the pipeline assets of the Seller other than the
Pipeline, that portion of such right of way to the extent covering Seller’s
assets other than the Pipeline.
 
1.3           Assumption of Liabilities.
 
(a)           Assumed Liabilities.  Buyer shall assume and thereafter perform,
pay, honor, and discharge when due and payable only the following liabilities,
obligations, commitments, penalties, damages, debts, charges, fees, expenses,
and disbursements (the “Assumed Liabilities”):
 
(i)           all liabilities and obligations of Seller incurred or accruing
under the Assumed Contracts with respect to periods commencing on and after the
Effective Time;
 
(ii)           all liabilities and obligations accruing, arising out of and
related to the ownership, possession, use or operation of the Acquired Assets on
and after the Effective Time, including liabilities and obligations for personal
injury or death or damage to property of any Third Party attributable to or
arising out of the ownership or operation of the Acquired Assets on and after
the Effective Time;
 
 
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(iii)           all liabilities and obligations relating to the ownership or
operation of the Leased Real Property and ROW Rights, including, without
limitation, obligations to bring such Leased Real Property and ROW Rights into
compliance with applicable Environmental Law regardless of whether such
liabilities or obligations or conditions or events giving rise to such
liabilities or obligations, arose, occurred or accrued before or after the
Effective Time; and
 
(iv)           all liabilities and obligations arising out of or related in any
way to the Pipeline Reactivation.
 
(b)           Retained Liabilities.  From and after the Effective Time, Seller
shall remain solely liable for and shall pay, perform and discharge when due all
of the following liabilities, obligations and commitments of Seller (the
“Retained Liabilities”):
 
(i)           all liabilities and obligations of Seller, Seller’s Affiliates, or
Seller’s Representatives, incurred or accruing under the Assumed Contracts with
respect to the period prior to the Effective Time;
 
(ii)           all liabilities (including liabilities and losses resulting from
shortages in the amounts of Linefill which were delivered by Seller into Buyer’s
custody but excluding liabilities or losses resulting from actions taken or not
taken by Buyer after Closing) and obligations arising out of or relating to or
associated with the Excluded Assets;
 
(iii)           all fines or penalties prescribed by a Governmental Entity for a
violation by Seller of its Affiliates of any applicable Laws (including
Environmental Laws) by or with respect to the Acquired Assets which violation
occurred prior to the Effective Time;
 
(iv)           all liabilities and obligations to the extent accruing or
resulting from or arising out of Seller’s (or Seller’s Affiliates’) offsite
disposal of Hazardous Materials resulting from Seller’s ownership, possession,
use or operation of the Acquired Assets prior to the Effective Time;
 
(v)           all liabilities and obligations (including any liabilities arising
under ERISA) directly arising out of the employment by Seller (or its
Affiliates) of its employees substantially involved in the operation of the
Acquired Assets prior to the Effective Time or the Excluded Assets; and
 
(vi)           all losses, claims, liabilities, demands, penalties, interest,
costs and expenses arising out of, accruing, incident, relating to, or in
connection with Seller or Seller’s Affiliates’ failure to pay Taxes attributable
or allocable to the Acquired Assets (excluding any sales or transfer Taxes to
the extent arising from the sale and purchase of the Acquired Assets)
attributable to or accruing during periods prior to the Effective Time.
 
Notwithstanding any provision in this Agreement to the contrary, the Retained
Liabilities shall include all liabilities accruing or arising in any manner
whatsoever as a result of, relating to or in connection with any criminal act
occurring or accruing prior to the Effective Time by Seller or Seller’s
Affiliates.
 
 
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1.4           Consideration.  The aggregate consideration for the sale and
transfer of the Acquired Assets shall be an amount in cash equal to
$40,000,000.00 (the “Purchase Price”). The Purchase Price shall be allocated as
provided in Section 7.10(e).  The Purchase Price shall be paid by Buyer at
Closing by wire transfer of immediately available funds to an account specified
in writing by Seller (which such account shall be specified in writing to Buyer
no later than three (3) Business Days prior to the Closing Date).
 
1.5           Pipeline Reactivation Adjustment.
 
(a)           The Parties acknowledge that the Purchase Price has been based in
part upon Buyer’s anticipated post-Closing reactivation of the Deactivated
Section of the Pipeline.  Subject to Seller’s reimbursement obligations pursuant
to Section 1.5(b), Buyer shall be responsible for all costs related to the
reactivation of the Deactivated Section of the Pipeline (the “Pipeline
Reactivation”) and shall use commercially reasonable efforts to limit the actual
out-of-pocket expenses incurred in connection therewith (the “Pipeline
Reactivation Costs”).
 
(b)           Should the Pipeline Reactivation Costs relating directly to the
reactivation of the Deactivated Section but excluding enhancements or
improvements to the Deactivated Section desired to be made by Buyer, including
the installation of block valves, pipeline connections and infrastructure to
separate the Deactivated Section from other assets of Seller or connect the
Deactivated Section with other assets of Buyer (the “Reimbursable Costs”) exceed
$500,000.00, then upon:
 
(i)    the full and final completion of the work associated with the
Reimbursable Costs;
 
(ii)   Buyer’s final and unconditional payment in full of the Reimbursable Costs
to the appropriate Third Party; and
 
(iii)  Seller’s receipt from Buyer of all documentation reasonably requested by
Seller to substantiate Buyer’s final and unconditional payment in full of the
Reimbursable Costs,
 
Seller shall reimburse Buyer for that portion of Buyer’s reasonably incurred
Reimbursable Costs that exceed $500,000.00; provided that, except as may be
mutually agreed upon by the Parties pursuant to Section 1.5(c), Seller’s
reimbursement obligations for Reimbursable Costs shall not exceed $500,000.00
(the “Reimbursable Costs Cap”).
 
(c)           Should Buyer’s Reimbursable Costs exceed $1,000,000.00, Seller and
Buyer shall engage in good faith negotiations to determine how such excess
Reimbursable Costs should be allocated between Buyer and Seller.
 
1.6           Adjustments to Purchase Price.  All amounts paid pursuant to
Section 1.5 shall be deemed to be adjustments to the Purchase Price, except as
otherwise required by applicable Laws.
 
1.7           Non-Assignment of Certain Acquired Assets.  Notwithstanding
anything contained in this Agreement to the contrary, this Agreement shall not
constitute an agreement to
 
 
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assign or sell any Acquired Asset if an attempted assignment thereof without
Consent would violate any right of any Third Party or any Law or Permit, and no
breach of this Agreement shall have occurred by virtue of such
non-assignment.  Notwithstanding the foregoing, if any necessary Consent is not
obtained prior to the Closing Date, Seller shall: (i) take all commercially
reasonable efforts subsequent to the Closing to obtain such Consent as quickly
as possible and (ii) to the extent not prohibited by the terms of any applicable
Contract or any Law or Permit and until the receipt of such Consent, hold at
Buyer’s sole cost and expense the Acquired Asset subject to obtaining such
Consent, together with any proceeds therefrom, in trust for Buyer and during the
pendency of such trust Buyer shall reimburse Seller for any costs or expenses
incurred by Seller for doing so, including any costs to operate or maintain such
asset.  Seller and Buyer shall cooperate (each at its own expense) in any lawful
and reasonable arrangement reasonably proposed by Buyer under which Buyer shall
obtain to the extent practicable the economic claims, rights and benefits under
the Acquired Asset, Claim or right with respect to which the Third Party Consent
or authorization has not been obtained in accordance with this Agreement.  Such
reasonable arrangement shall be subject to Buyer’s prior written approval, not
to be unreasonably withheld, and may include (x) the subcontracting,
sublicensing or subleasing to Buyer at no cost to Seller of any and all rights
of Seller against the other party to such Third Party agreement arising out of a
breach or cancellation thereof by the other party and (y) commercially
reasonable efforts by Seller to enforce such rights.  If Buyer is able to
receive the economic claims, rights and benefits under such asset, such economic
claims, rights and benefits shall constitute an Acquired Asset.  The provisions
of this Section 1.7 shall survive Closing.
 
ARTICLE II
CLOSING
 
2.1           Closing.  The closing of the transactions contemplated hereby (the
“Closing”) shall be held at the offices of Vinson & Elkins LLP, 1001 Fannin
Street, Suite 2500, Houston, Texas  77002 at 10:00 a.m. on the second to last
Business Day of the month in which the satisfaction or waiver of the conditions
set forth in Article IX and elsewhere in this Agreement (other than those
conditions relating to execution of the Ancillary Agreements, which will be
satisfied at the Closing) occurs, or such other place, time or date as may be
agreed upon by the Parties.  The date on which the Closing takes place is
referred to herein as the “Closing Date.”  The Closing shall be deemed to be
effective as of 12:01 a.m. on the Closing Date (the “Effective Time”).
 
2.2           Deliveries by Seller.  At the Closing, Seller shall deliver, or
cause to be delivered, to Buyer the following:
 
(a)           a duly executed counterpart to the assignment and assumption of
Assumed Contracts consisting of leases and subleases of the Leased Real Property
substantially in the form attached hereto as Exhibit A (the “Leased Real
Property Assignments”);
 
(b)           a duly executed counterpart to the bill of sale, assignment and
assumption agreement covering all Acquired Assets (other than the Leased Real
Property) substantially in the form attached hereto as Exhibit B (the “Bill of
Sale”);
 
 
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(c)           a duly executed and acknowledged counterpart to the assignment and
assumption of Assumed Contracts (excluding leases and subleases) substantially
in the form attached hereto as Exhibit C (the “Assumed Contracts Assignment”)
 
(d)           a duly executed counterpart to the Transition Services Agreement
substantially in the form of Exhibit D (the “Transition Services Agreement”);
 
(e)           a duly executed Closing Statement, showing the flow of funds,
substantially in the form of Exhibit E (the “Closing Statement”);
 
(f)           a duly executed Purchase Price Receipt, confirming the Seller’s
receipt of funds at Closing, substantially in the form of Exhibit F;
 
(g)           a duly executed custody transfer receipt, transferring custody,
but not title of all Linefill, substantially in the form of Exhibit G (the
“Custody Transfer Receipt”);
 
(h)           a parent guaranty of Western Refining, Inc., guarantying Seller’s
obligations under this Agreement, substantially in the form of Exhibit H (the
“Seller Guaranty”);
 
(i)           a duly executed and acknowledge non-foreign ownership (FIRPTA)
Affidavit substantially in the form of Exhibit I;
 
(j)           organizational and authorizing documents of Seller as shall be
reasonably required by Buyer to evidence Seller’s authority to enter into and
consummate the transactions contemplated by this Agreement and the Ancillary
Agreements;
 
(k)           the originals (or copies if originals are not available) of all of
the Assumed Contracts and the Books and Records;
 
(l)           all documentation, in a form that is reasonably acceptable to
Buyer, reasonably necessary to reflect a release of all of the liens against the
Acquired Assets listed on Schedule 2.2(l);
 
(m)           duly executed notices to Third Parties under the Assumed Contracts
and assumed leases in the form of Exhibit J, advising such Third Parties of
Buyer’s assumption of Seller’s obligations thereunder accruing on and after the
Effective Time;
 
(n)           a duly executed certificate of Seller, dated as of the Closing
Date, certifying that the conditions set forth in Sections ‎9.2(a)(i) and
‎9.2(a)(ii) have been fulfilled, substantially in the form of Exhibit K;
 
(o)           a duly executed counterpart to the Right of Way Assignment
substantially in the form of Exhibit N (the “ROW Assignment”); provided that
such ROW Rights shall be conveyed without any warranty of title; and
 
(p)           any other documents, instruments or agreements contemplated hereby
or reasonably necessary or appropriate to consummate the transactions
contemplated by this Agreement, and in a form reasonably acceptable to Buyer and
Seller (it being understood that
 
 
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such instruments shall not require Seller or any other Person to make any
additional representations, warranties or covenants, express or implied, not
contained in or as contemplated by this Agreement or the Ancillary Agreements).
 
2.3           Deliveries by Buyer.  At the Closing, the Buyer shall deliver, or
cause to be delivered, to Seller the following:
 
(a)           the Purchase Price;
 
(b)           a duly executed counterpart to the Leased Real Property
Assignments;
 
(c)           a duly executed counterpart to the Bill of Sale;
 
(d)           a duly executed counterpart to the Assumed Contract Assignment;
 
(e)           a duly executed counterpart to the Transition Services Agreement;
 
(f)           a duly executed counterpart to the Custody Transfer Receipt;
 
(g)           a duly executed counterpart to the Closing Statement;
 
(h)           a duly executed counterpart to the ROW Assignment;
 
(i)           a duly executed certificate of Buyer, dated as of the Closing
Date, certifying that the conditions set forth in Sections ‎9.3(a) and ‎9.3(b)
have been fulfilled, substantially in the form of Exhibit L;
 
(j)           a parent guaranty of Plains All American Pipeline, L.P.,
guarantying Buyer’s obligations under this Agreement, substantially in the form
of Exhibit M (the “Buyer Guaranty”); and
 
(k)           any other documents, instruments or agreements contemplated hereby
or reasonably necessary or appropriate to consummate the transactions
contemplated by this Agreement, and in a form reasonably acceptable to Buyer and
Seller (it being understood that such instruments shall not require Buyer,
Seller or any other Person to make any additional representations, warranties or
covenants, express or implied, not contained in or as contemplated by this
Agreement or the Ancillary Agreements).
 
2.4           Prorations.
 
(a)           On the Closing Date, or as promptly as practicable following the
Closing Date, but in no event later than one hundred and twenty (120) calendar
days thereafter, the water, gas, electricity and other utilities, local business
or other license fees to the extent assigned and other similar periodic charges
payable with respect to the Acquired Assets shall be prorated between Seller, on
the one hand, and Buyer, on the other hand, effective as of the Effective Time
with Seller being responsible for amounts related to the period prior to but
excluding the Closing Date and Buyer being responsible for amounts related to
the period on and after the Closing Date.  The Parties shall use commercially
reasonable efforts to cause utility meter readings to be
 
 
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determined as of the Effective Time or as close thereto as reasonably
practicable; provided, however, that if a Party’s proration for a particular
amount owed under this Section 2.4 cannot be determined due to the
unavailability of the necessary information on the appropriate invoice or
remittance statement, then the proration shall be calculated on a per day basis
using the number of days in the respective Party’s period.
 
(b)           All income, proceeds and receipts attributable to the operation,
use, ownership, or otherwise of the Acquired Assets prior to the Effective Time
shall be the property of Seller and to the extent received by Buyer or its
Affiliates, Buyer shall promptly and fully disclose, account for and transmit
same to Seller.  All income, proceeds and receipts attributable to the
operation, use, ownership, or otherwise of the Acquired Assets on and after the
Effective Time shall be the property of Buyer and to the extent received by
Seller or its Affiliates, Seller shall promptly and fully disclose, account for
and transmit same to Buyer.  In addition, all invoices, costs, expenses,
disbursements and payables attributable to the Acquired Assets prior to the
Effective Time shall be the sole obligation of Seller, and Seller shall promptly
pay, or if paid by Buyer, Seller shall promptly reimburse Buyer for same.  All
invoices, costs, expenses, disbursements and payables attributable to the
Acquired Assets on and after the Effective Time shall be the sole obligation of
Buyer, and Buyer shall promptly pay, and to the extent paid by Seller, Buyer
shall promptly reimburse Seller for same.
 
(c)           The provisions of this Section 2.4 shall survive the Closing.
 
2.5           Closing Costs; Transfer Taxes and Fees.
 
(a)           Allocation of Costs.  Buyer shall pay all sales, transfer and use
Taxes arising out of the transactions contemplated by this Agreement (including
the grantors tax for recording real estate conveyance documents) and all costs
and expenses (including recording fees and real estate transfer Taxes) incurred
in connection with Buyer obtaining or recording title to the Acquired
Assets.  The sales, use and transfer Tax Returns required by reason of the
transactions contemplated by this Agreement shall be timely prepared and filed
by the Party obligated by Law to make such filing.  The Parties agree to
cooperate with each other (at their own expense) in connection with the
preparation and filing of such returns, in obtaining all available exemptions
from such sales, use and transfer Taxes, and in timely providing each other with
resale certificates and any other documents necessary to satisfy any such
exemptions.
 
(b)           Reimbursement.  If a Party pays any Tax agreed to be borne by
another Party under this Agreement, such other Party shall promptly (and in any
event within five (5) Business Days after receipt of written notice thereof)
reimburse the paying Party for the amounts so paid.  If any Party receives any
Tax refund or credit applicable to a Tax paid by another Party, the receiving
Party shall promptly (and in any event within five (5) Business Days) pay such
amounts to the Party entitled thereto.  The provisions of this Section 2.5(b)
shall survive the Closing.
 
(c)           Occasional Sale Tax Certificate.  Seller shall cooperate with
Buyer and use reasonable efforts to deliver to Buyer a certificate, in form
materially satisfactory to Buyer and Seller, to support the availability of an
occasional sale exemption for the Transaction under New Mexico Law.
 
 
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ARTICLE III
REPRESENTATIONS AND WARRANTIES OF SELLER
 
Except as set forth on the disclosure schedule delivered by Seller to Buyer in
connection with this Agreement (the “Disclosure Schedule”), Seller hereby
represents and warrants to the Buyer as follows as of the Agreement Date:
 
3.1           Organization.  Seller is a corporation duly organized, validly
existing and in good standing under the Laws of the State of New Mexico and has
the requisite power to own, lease and operate its properties and assets and to
carry on its business as now being conducted.  Seller is duly qualified to do
business and in good standing as a foreign corporation in each of the states in
which it has assets or conducts activities which require it to be so qualified
or in good standing, except where the failure to be so qualified or in good
standing would not reasonably be expected to have a Material Adverse Effect.
 
3.2           Authorization.  Seller has full corporate power and authority to
execute and deliver this Agreement and the Ancillary Agreements and consummate
the transactions contemplated hereby and thereby.  Seller has taken all
corporate action required to authorize the execution, delivery and performance
of this Agreement and the Ancillary Agreements and the consummation of the
transactions contemplated hereby and thereby.  This Agreement has been duly
executed and delivered by Seller and, assuming due authorization, execution and
delivery by Buyer, constitutes a legal, valid and binding obligation of Seller,
enforceable against Seller in accordance with its terms, except as enforcement
may be limited by applicable bankruptcy, insolvency, reorganization, moratorium,
fraudulent conveyance or other similar Laws now or hereafter in effect relating
to creditors’ rights generally and general principles of equity, regardless of
whether enforceability is considered in a proceeding at law or in equity
(collectively, the “Creditor’s Rights Exception”).  The Ancillary Agreements
shall, on the Closing Date, be duly and validly executed by Seller and, assuming
due authorization, execution and delivery by the other parties thereto,
constitute legal, valid and binding obligations of Seller, enforceable against
Seller in accordance with their respective terms, except for the Creditor’s
Rights Exception.
 
3.3           No Conflicts; Consents.  Except as set forth on Schedule 3.3 and
subject to obtaining the Required Third Party Consents, the execution, delivery
and performance by Seller of this Agreement and the Ancillary Agreements do not,
and the consummation of the transactions contemplated hereby and thereby will
not, b) violate, conflict with, or result in any breach of any provision of the
Governing Documents of Seller, c) to the Knowledge of Seller, violate, conflict
with or result in a violation or breach of, or constitute a default under, any
of the material terms, conditions or provisions of any material Contract, or
other instrument or agreement to which Seller is a party or by which Seller or
any material portion of its assets (including the Acquired Assets) is bound, or
d) to the Knowledge of Seller, violate in any material respect any applicable
Law binding upon Seller or any material portion of its assets (including the
Acquired Assets), except in the case of subsections (a), (b) and (c) such
matters as would not be reasonably expected to have a Material Adverse
Effect.  To the Knowledge of Seller, no Consent of any Governmental Entity or
any other Person is required to be obtained by Seller in connection with the
execution, delivery and performance of this Agreement and the Ancillary
Agreements to which Seller is a party or the consummation of the transactions
 
 
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contemplated hereby or thereby, except for (1) requirements under the HSR Act,
(2) the Consents set forth in Schedule ‎3.3 (the “Required Third Party
Consents”), (iii) Consents which the failure to obtain would not reasonably be
expected to have a Material Adverse Effect, and (iv) Post-Closing Consents.
 
3.4           Compliance With Laws and Permits.  To the Knowledge of Seller,
except as set forth on Schedule 3.4, Seller owns and operates the Acquired
Assets in material compliance with all applicable Laws.  Except as set forth on
Schedule 3.4, no investigation or review by any Governmental Entity with respect
to Seller or any of its Affiliates and relating to the Acquired Assets is
pending or, to the Knowledge of Seller, threatened which, if resolved adversely
to Seller or any of its Affiliates, would have a Material Adverse
Effect.  Notwithstanding the foregoing, the Seller makes no representation or
warranty, express or implied, under this Section 3.4 relating to any (3) Tax
matters, which are exclusively addressed in Section 3.9 or (4) environmental
matters, which are exclusively addressed in Section 3.11.
 
3.5           Absence of Litigation.  Except as set forth on Schedule ‎3.5,
there is no Action pending or, to the Knowledge of Seller, threatened, against
Seller or any of its Affiliates relating to the Acquired Assets or challenging
the transactions contemplated hereby.
 
3.6           Absence of Changes.  Since June 30, 2011, e) Seller and its
Affiliates have operated and maintained or idled the Acquired Assets in the
ordinary course of business consistent with past practice and f) there has not,
to the Knowledge of Seller, occurred a Material Adverse Effect.
 
3.7           Title to Acquired Assets.
 
(a)           Except as set forth on Schedule ‎3.7(a), at the Closing (and as of
the Effective Time), Seller will have and will convey to Buyer i) good and valid
title to the Personal Property and ii) valid leasehold interests in all of the
Leased Real Property, in each case of the foregoing clauses (i) through (ii),
inclusive, free and clear of any Liens, other than Permitted Liens.
 
(b)           Except as set forth on Schedule ‎3.7(b), neither Seller nor its
Affiliates have received any written notice from any Governmental Entity, and to
the Knowledge of Seller, neither Seller nor its Affiliates have received any
notice (either verbal or written) from any Governmental Entity of any pending or
threatened condemnation, eminent domain or similar proceeding or special
assessment affecting the Leased Real Property or any portion thereof.
 
(c)           Except as set forth on Schedule 3.7(c), iii) Seller is not a party
to any Contract regarding the sale, conveyance, transfer, lease or disposition
of any portion of the Acquired Assets (except for this Agreement or as
contemplated hereby); iv) there has not been granted to any Person and no Person
possesses, any option to purchase or right of first refusal to purchase any
portion of the Acquired Assets; and v) Seller is not a party to any sublease or
similar arrangement with respect to the Leased Real Property or any portion
thereof.
 
(d)           Except as set forth on Schedule ‎3.7(d), neither Seller nor its
Affiliates have received any written notice that Seller is in default under any
lease or other Assumed Contract in respect of the Acquired Assets, or any
portion thereof, which matter remains
 
 
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unresolved as of the date hereof except for that which would not reasonably be
expected to have a Material Adverse Effect.
 
3.8           Contracts.  True, correct and complete copies of all Assumed
Contracts have been delivered to Buyer.  Except as disclosed in Schedule 3.8, to
the Knowledge of Seller, (a) each Assumed Contract is in full force and effect
and constitutes a valid and binding agreement, enforceable in accordance with
its terms, except for the Creditor’s Rights Exception, (b) Seller has fulfilled
and performed all of Seller’s material obligations and requirements under the
Assumed Contracts, (c) neither Seller nor any of its Affiliates is in breach of
or default, in any material respect, under any Assumed Contract, and (d)
provided all Required Third Party Consents are obtained prior to Closing, no
event or action has occurred, is pending, or to the Knowledge of Seller, is
threatened, which after the giving of notice, or the lapse of time, or both,
would reasonably be expected to result in the termination, breach or default of
any Assumed Contract.  Except as disclosed in Schedule 3.8, to the Knowledge of
Seller, (a) no other party to any Assumed Contract is in breach of or default
under such Assumed Contract in any material respect, and (b) neither Seller nor
any of its Affiliates has received any written notice from any other party to
any Assumed Contract that alleges any violation, breach or default by Seller or
any Affiliate of Seller of any Assumed Contract in any material respect.
 
3.9           Taxes.  Except as set forth in Schedule ‎3.9, with respect to
Taxes the non-payment of which could result in a Lien on the Acquired Assets or
for which Buyer could be held liable, g) all Tax Returns required to be filed
with respect to such Taxes have been duly and timely filed and all such Tax
Returns are correct and complete in all material respects; h) all such Taxes
that have become due have been paid in full by Seller; i) there is no Claim or
Action against Seller (or its Affiliates) for any such Taxes, and no assessment,
deficiency, or adjustment has been asserted, proposed, or threatened with
respect to any such Taxes; and j) there is not in force any extension of time of
the statute of limitations with respect to the collection of any such
Taxes.  None of the Acquired Assets are held in any arrangement that is
classified as a partnership for federal income tax purposes.  There are no Liens
for Taxes encumbering any of the Acquired Assets other than Permitted Liens.
 
3.10           Employees.  There are no employees associated with the Acquired
Assets who will be transferred to Buyer (or its Affiliates) under this
Agreement.  
 
3.11           Environmental Matters.
 
(a)           Actions.  Except as set forth on Schedule ‎3.11(a), there are no
Claims or Actions pending or, to the Knowledge of Seller, threatened against the
Acquired Assets, Seller, or any of its Affiliates, relating to the Acquired
Assets that allege i) Seller or any its Affiliates are presently required to
perform any remedial obligations under any applicable Environmental Law or
Environmental Permit, ii) violations by Seller or any of its Affiliates of any
Environmental Law or Environmental Permit, or iii) personal injury or property
damage claims relating to a Release of Hazardous Materials by Seller or any its
Affiliates.
 
(b)           Compliance.  Except as set forth on Schedule 3.11(b), to the
Knowledge of Seller:
 
 
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(i)           Seller’s current operation of the Acquired Assets is in
compliance, in all material respects, with all applicable Environmental Laws and
Environmental Permits, except for violations that are or can be remedied by
routine repair and maintenance in the ordinary course of business.
 
(ii)           To the Knowledge of Seller, neither Seller, nor its Affiliates
have received any written notice of noncompliance with or violation of any
Environmental Law or Environmental Permit or entered into any consent decree or
order, or is subject to any order of any court or Governmental Entity relating
to Environmental Laws.
 
(iii)           Set forth in Schedule ‎3.11(b)(iii) is a true, correct and
complete list of all Environmental Permits held by Seller or its Affiliates in
connection with the ownership, occupancy and the current operation of the
Acquired Assets.  All such Environmental Permits have been duly obtained or
filed and are in full force and effect, and the applicable holder of each
Environmental Permit is in compliance, in all material respects, with such
Environmental Permits.  To the Knowledge of Seller, Seller has all Environmental
Permits required under Environmental Law reasonably necessary to own, lease or
operate the Acquired Assets as currently operated by Seller, and there exists no
material violation thereof, material default thereunder or material breach
thereof, and to the Knowledge of Seller, no event has occurred or condition or
state of facts exists which, after notice or lapse of time, or both, would
constitute a material breach or material default under such Environmental
Permits.  To the Knowledge of Seller, no Governmental Entity has given, any
notice to terminate or cancel any such Environmental Permit held by Seller or
its Affiliates in connection with Seller’s ownership, occupancy or current
operation of the Acquired Assets.  To the Knowledge of Seller, Seller has timely
submitted in accordance with prior customary practices of the Seller and in
accordance with applicable Law any and all applications necessary for such
Environmental Permits to remain in full force and effect.
 
(iv)           To the Knowledge of Seller, none of the Acquired Assets is
encumbered by a Lien (other than a Permitted Lien) arising or imposed under
Environmental Laws or Environmental Permits.
 
(v)           To the Knowledge of Seller, except for de minimis quantities
associated with routine operation of the Acquired Assets, there has been no
release by Seller or its Affiliates of Hazardous Materials on the Leased Real
Property in violation of Environmental Laws or Environmental Permits or in
amounts that would reasonably be expected to give rise to an obligation to
perform remediation or other corrective action pursuant to Environmental Laws.
 
(vi)           Seller has furnished to Buyer all material environmental audits,
internal reports, inspection reports of Governmental Entities and other material
environmental documents relating to the Acquired Assets that are in Seller’s
possession, custody or control.
 
(vii)           None of the Acquired Assets is listed on the National Priorities
List or any equivalent “Superfund” list under the statutes of the State of New
Mexico requiring remedial action.
 
 
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(viii)           Seller is in compliance in all material respects with all
Orders issued by a Governmental Entity pursuant to Environmental Laws in respect
of the Pipeline.
 
3.12           No Brokers or Finders.  There is no investment banker, broker,
finder, financial advisor or other intermediary who has been retained by or is
authorized to act on behalf of Seller or any of its Affiliates who is entitled
to receive from Seller any fee or commission in connection with the transactions
contemplated by this Agreement or any part thereof or any interest therein.
 
3.13           Sufficiency of Assets.  The Acquired Assets include substantially
all of the assets, properties, rights (including Intellectual Property rights
(if any)), titles and interests of Seller (other than the Excluded Assets) used
by Seller in the operation of the Pipeline and necessary for the operation of
the Pipeline as operated by Seller at Closing.  To the Knowledge of Seller, the
Acquired Assets include all of the assets, properties, rights and interests
necessary for Seller to conduct the Business.
 
3.14           Intellectual Property.  Except as set forth on Schedule 3.14,
there are no licenses or other rights to use (including, foreign rights) or any
copyrights, patents, patent applications, trade names, trade secrets, registered
and unregistered trademarks, servicemarks, franchises, domain names or other
similar rights now used or employed by Seller with respect to the Acquired
Assets.  To Seller’s Knowledge, no Third Party is infringing on or otherwise
violating any right of Seller with respect to the Assigned Intellectual Property
and Seller’s (or Seller’s Affiliates’) use of the Assigned Intellectual Property
is not infringing on any Third Party’s Intellectual Property.
 
3.15           WAIVERS AND DISCLAIMERS.  BUYER ACKNOWLEDGES THAT IT HAS HAD AN
OPPORTUNITY TO INSPECT THE ACQUIRED ASSETS, THAT IT HAS CONDUCTED ITS
INDEPENDENT DUE DILIGENCE INVESTIGATION AND INSPECTION OF ALL ASPECTS OF SUCH
ACQUIRED ASSETS AND THE CLOSING OF THE TRANSACTIONS CONTEMPLATED HEREBY IS NOT
CONDITIONED ON IT CONDUCTING FURTHER DUE DILIGENCE.  OTHER THAN AS EXPRESSLY SET
OUT HEREIN OR IN THE ANCILLARY AGREEMENTS, BUYER IS RELYING ON SUCH INDEPENDENT
INVESTIGATION AND INSPECTION OF THE ACQUIRED ASSETS AND IS NOT RELYING ON ANY
INFORMATION PROVIDED BY SELLER OR ITS REPRESENTATIVES IN DETERMINING WHETHER TO
ACQUIRE THE ACQUIRED ASSETS.
 
NOTWITHSTANDING ANYTHING TO THE CONTRARY CONTAINED IN THIS AGREEMENT, EXCEPT FOR
THE EXPRESS REPRESENTATIONS AND WARRANTIES MADE BY SELLER SET FORTH IN THIS
ARTICLE III AND EXCEPT FOR THE OTHER COVENANTS AND AGREEMENTS MADE BY SELLER IN
THIS AGREEMENT OR IN THE ANCILLARY AGREEMENTS, BUYER ACKNOWLEDGES AND AGREES
THAT THE SALE AND BUYER’S ACQUISITION OF THE ACQUIRED ASSETS AS PROVIDED FOR
HEREIN SHALL BE MADE IN AN “AS IS”, “WHERE IS” CONDITION WITH ALL FAULTS AND
THAT SELLER HAS NOT MADE, NOR DOES IT MAKE, AND SELLER SPECIFICALLY NEGATES AND
DISCLAIMS, ANY REPRESENTATIONS, WARRANTIES, PROMISES, COVENANTS, AGREEMENTS OR
GUARANTIES OF ANY KIND OR CHARACTER WHATSOEVER, WHETHER
 
 
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EXPRESS OR IMPLIED, ORAL OR WRITTEN, PAST OR PRESENT, REGARDING (A) THE VALUE,
NATURE, QUALITY OR CONDITION OF THE ACQUIRED ASSETS, INCLUDING WITHOUT
LIMITATION, THE WATER, SOIL, GEOLOGY OR ENVIRONMENTAL CONDITION OF THE
PROPERTIES INCLUDED IN THE ACQUIRED ASSETS, GENERALLY, INCLUDING THE PRESENCE OR
LACK OF HAZARDOUS SUBSTANCES OR MATTERS ON SUCH PROPERTIES, (B) THE INCOME TO BE
DERIVED FROM THE ACQUIRED ASSETS, (C) THE SUITABILITY OF THE ACQUIRED ASSETS FOR
ANY AND ALL ACTIVITIES AND USES WHICH BUYER OR ANY OTHER PARTY MAY CONDUCT
THEREON, (D) THE COMPLIANCE OF OR BY ANY SUCH ACQUIRED ASSET OR ITS OPERATION
WITH ANY LAWS OF ANY GOVERNMENTAL ENTITY (INCLUDING ANY ZONING, ENVIRONMENTAL
PROTECTION, POLLUTION OR LAND USE LAWS, RULES, REGULATIONS, ORDERS, OR
REQUIREMENTS), OR (E) THE HABITABILITY, MERCHANTABILITY, MARKETABILITY,
PROFITABILITY OR FITNESS FOR A PARTICULAR PURPOSE OF ANY OF THE ACQUIRED
ASSETS.  THIS PARAGRAPH SHALL SURVIVE THE CLOSING.  BUYER ACKNOWLEDGES THAT THE
WAIVERS AND DISCLAIMERS IN THIS SECTION ARE CONSPICUOUS.
 
3.16           Survival.  The representations and warranties of Seller in this
Agreement and in the Ancillary Agreements shall survive the Closing or the
earlier termination of this Agreement in accordance with the survival provisions
set forth in Section 11.6.
 
ARTICLE IV
REPRESENTATIONS AND WARRANTIES OF THE BUYER
 
Buyer hereby represents and warrants to Seller as follows as of the Agreement
Date:
 
4.1           Organization.  Buyer is a limited partnership, duly organized,
validly existing and in good standing under the Laws of its state of
organization and has the requisite limited partnership power to own, lease and
operate its properties and to carry on its business as now being conducted.
Buyer is duly qualified to do business and in good standing as a foreign limited
partnership in all jurisdictions in which the character of the properties now
owned or leased by it or the nature of the business conducted by it requires it
to be so licensed or qualified, except where the failure to be so licensed or
qualified would not materially impair Buyer’s ability to consummate the
transactions contemplated by this Agreement.
 
4.2           Authorization.  Buyer has full limited partnership power and
authority to k) execute and deliver this Agreement and the Ancillary Agreements
contemplated hereby to be executed and delivered by Buyer and l) consummate the
transactions contemplated hereby and thereby.  Buyer has taken all limited
partnership action required to authorize: 1. the execution and delivery of this
Agreement and the Ancillary Agreements to be executed and delivered by Buyer and
2. the consummation of the transactions contemplated hereby and thereby.  This
Agreement has been duly and validly executed and delivered by Buyer and,
assuming due authorization, execution and delivery by Seller, is a legal, valid
and binding obligation of the Buyer, enforceable against it in accordance with
its terms, except for the Creditor’s Rights Exception.  The Ancillary Agreements
shall, on the Closing Date, be duly and validly executed by Buyer and, assuming
due authorization, execution and delivery by the other parties thereto,
 
 
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constitute legal, valid and binding obligations of Buyer, enforceable against
Buyer in accordance with their respective terms, except for the Creditor’s
Rights Exception.
 
4.3           No Violations; Consents.  Except as set forth on Schedule 4.3, the
execution, delivery and performance by Buyer of this Agreement and the Ancillary
Agreements do not, and consummation of the transactions contemplated hereby and
thereby will not, m) violate, conflict with, or result in any breach of any
provisions of the Governing Documents of Buyer; n) to the Knowledge of Buyer,
violate, conflict with or result in a violation or breach of, or constitute a
default under, any of the material terms, conditions or provisions of any
material Contract, or other instrument or obligation, to which Buyer is a party
or by which Buyer or any material portion of its assets is bound; or o) subject
to obtaining the Consents or making the registrations, declarations or filings
set forth in the next sentence, to the Knowledge of Buyer materially violate any
applicable Law binding upon Buyer or by which it or any material portion of its
assets are bound, except in the case of subsections (a), (b) and (c) such
matters as would not be reasonably expected to have a Material Adverse
Effect.  To the Knowledge of Buyer, no Consent of any Governmental Entity or any
other Person is required to be obtained by Buyer in connection with the
execution, delivery and performance of this Agreement and the other Ancillary
Documents to which Buyer is a party or the consummation of the transactions
contemplated hereby and thereby, except for (1) under the HSR Act, (ii) the
Required Third Party Consents, (iii) Consents the which the failure to obtain
would not reasonably be expected to have a Material Adverse Effect and
(iv) Post-Closing Consents.
 
4.4           Absence of Litigation.  Except as set forth on Schedule 4.4, there
is no Action pending or, to the Knowledge of Buyer, threatened against Buyer or
any of its Affiliates relating to the Acquired Assets or the transactions
contemplated by this hereby.
 
4.5           No Brokers and Finders.  There is no investment banker, broker,
finder, financial advisor or other intermediary who has been retained by or is
authorized to act on behalf of the Buyer who is entitled to receive from Buyer
any fee or commission in connection with the transactions contemplated by this
Agreement or any part thereof or any interest therein.
 
4.6           Due Diligence.  Buyer is an informed and sophisticated buyer
experienced in financial and business matters and the evaluation and investment
in businesses such as Seller’s and the transactions as contemplated
hereunder.  Buyer has undertaken such investigation as it has deemed necessary
to enable it to make an informed decision with respect to the execution,
delivery and performance of this Agreement.  Seller has provided Buyer with an
opportunity to ask questions of the officers and management of Seller and its
Affiliates.
 
4.7           Sufficient Funds.  Buyer has sufficient cash or cash equivalents
available to pay the aggregate Purchase Price on the terms and conditions
contained in this Agreement, and there is no restriction on the use of such cash
or cash equivalents for such purpose.
 
 
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ARTICLE V
COVENANTS AND AGREEMENTS OF SELLER
 
5.1           Pre-Closing Access and Information.
 
(a)           Subject to Section ‎6.1, and upon reasonable advance written
notice, Seller shall grant, or cause to be granted to, Buyer and its
Representatives reasonable access during Seller’s normal business hours
throughout the period beginning on the date hereof through the Closing Date (the
“Interim Period”) to the Acquired Assets and the books and records and other
information relating to the Acquired Assets (subject to any applicable
confidentiality agreements, legal restrictions and legal privileges) for the
purpose of inspecting the same.  During the Interim Period, Seller shall use all
commercially reasonable efforts to 1.  furnish, or cause to be furnished to,
Buyer and its Representatives all data and information concerning the Acquired
Assets that may reasonably be requested by Buyer, and 2. make available, or
cause to be made available, to Buyer and its Representatives, such personnel and
employees of Seller and its Affiliates as may reasonably be
requested.  Notwithstanding the preceding sentences to the contrary, nothing in
this Agreement shall be construed to permit Buyer or its Representatives to have
access to any files, records, Contracts or documents of Seller or its Affiliates
relating to (a) Seller’s or its Affiliates’ inter-company or intra-company
feedstock and product pricing information, internal transfer prices, hedging
activity records and business inventory valuation procedures and records,
(b) any bids relating to the transactions contemplated by this Agreement and the
Ancillary Agreements, (c) any of the Excluded Assets, and (d) the negotiation or
execution of this Agreement.
 
5.2           Conduct of Business.
 
(a)           During the Interim Period, and except as expressly contemplated
under this Agreement, as required by Law or as or set forth in Schedule 5.2,
without the prior written consent of Buyer, which consent shall not be
unreasonably withheld, conditioned or delayed:
 
(i)           Seller shall not enter into any Contract which constitutes a
Material Contract if such Material Contract would be an Assumed Contract or
amend, rescind, terminate or waive any rights under any Assumed Contract;
 
(ii)           Seller shall conduct its business in the ordinary course of
business consistent with past practice;
 
(iii)           Seller shall use reasonable efforts to maintain in full effect
all policies of insurance relating to the Acquired Assets existing as of the
Agreement Date;
 
(iv)           Seller shall not sell, lease or otherwise transfer or dispose of,
or grant or permit, by Seller or its Affiliate’s direct action, any Lien (other
than Permitted Liens) on any of the Acquired Assets;
 
(v)           except as reasonably necessary for the safe operation of the
Acquired Assets, Seller shall not incur, or commit to incur, any liability or
any obligation to make capital expenditures, which would survive the Closing,
with respect to the Acquired Assets in excess of $50,000 individually or
$150,000 in the aggregate;
 
 
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(vi)           except as reasonably necessary for the safe operation of the
Acquired Assets, Seller shall not incur, or commit to incur, any liability or
any obligation to make operating expenditures which liability or obligations
would become an Assumed Liability other than in the ordinary course of business;
 
(vii)         Seller shall not settle any Action or Claim relating to or
affecting the Acquired Assets post-Closing in an amount that exceeds $50,000 or
Actions or Claims that collectively exceed $150,000 in the aggregate;
 
(viii)        Seller shall not merge, consolidate, convert, liquidate, dissolve
or otherwise wind up its business; or
 
(ix)           neither Seller nor any Affiliate of Seller shall commit itself to
do any of the foregoing negative covenants.
 
(b)           Notwithstanding anything in this Agreement to the contrary, Seller
shall be permitted to (i) dividend, distribute or transfer all cash on-hand to
any Affiliate of Seller before or as of the Closing Date and (ii) take all
necessary steps, including any governmental filings, as may be necessary or
advisable in connection therewith, provided that no such action may result in,
cause or have a Material Adverse Effect on Seller or its Affiliates’ ability to
fully perform its obligations under this Agreement.
 
5.3           Schedules.  Prior to the Closing, Seller may, from time to time,
by written notice to Buyer, supplement or amend the Disclosure Schedule solely
with respect to matters arising on or after the date of this Agreement, and if
the Closing occurs, any such supplement or amendment will be effective to cure
and correct any breach of any representation, warranty or covenant that would
have existed if Seller would not have made such supplement or amendment.  Other
than a supplement or amendment relating to matters permitted or consented to
under Section 5.2 or matters which do not involve Losses to Buyer in excess of
$175,000 in the aggregate, if such supplement or amendment discloses any facts
that would reasonably be expected to cause any of the Closing conditions in
Article IX not to be satisfied, then the Parties shall negotiate in good faith
for a period not to exceed thirty (30) days to determine a reasonable adjustment
to the Purchase Price to adequately reflect any Losses estimated to be incurred
as a result of such matter; provided, however, that if no such adjustment is
agreed by the Parties by the expiration of such period, then either Party shall
have the right to terminate this Agreement pursuant to Section 10.1(e).
 
ARTICLE VI
COVENANTS AND AGREEMENTS OF BUYER
 
6.1           Pre-Closing Access and Inspections.
 
(a)           During the Interim Period, Buyer shall not contact or communicate
with any employees, customers, suppliers or distributors of Seller or its
Affiliates or the Acquired Assets solely in connection with or with respect to
this Transaction or any of the matters contemplated by this Agreement, except
with Seller’s prior written consent, not to be unreasonably withheld,
conditioned or delayed.
 
 
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(b)           Any inspection or investigation conducted by Buyer or its
Representatives prior to the Closing ii) shall be conducted in accordance with
applicable Laws and in such manner as not to interfere unreasonably with the
business of Seller or its Affiliates or the Acquired Assets; or iii) shall not
entitle Buyer to conduct any Phase II environmental assessments or any other
sampling or testing of soil or ground or surface water at, or under, the Leased
Real Property or any real property used in the Pipeline Business, without the
prior written consent of Seller, with Buyer being limited to visual inspections
of the Acquired Assets and the review of Seller’s and its Affiliates’ records
and any other publicly available materials or information with regard to these
matters.  Buyer shall bear the risk of injury to any of its Representatives
conducting any inspection or investigation of the Acquired Assets; provided
however, that Buyer shall not bear such risk if the injury is solely caused by
the gross negligence or willful misconduct of Seller, its Representatives or its
Affiliates and in such event, Seller shall be fully liable therefore.
 
(c)           Notwithstanding any provision to the contrary contained in this
Agreement, Buyer’s and Seller’s obligations under the last sentence in Section
6.1(b) shall survive the Closing or the earlier termination of this Agreement,
in accordance with the survival provisions set forth in Section 11.6.
 
6.2           Post-Closing Preservation of Books and Records; Access.
 
(a)           For a period of six (6) years from and after the Effective Time,
Buyer shall, and shall cause its Affiliates to, upon receipt of reasonable prior
written request from Seller, (i) afford to Seller and its Representatives
reasonable access during Buyer’s normal business hours to the Buyer’s employees,
Acquired Assets and to the Books and Records delivered to Buyer by Seller at
Closing; (ii) provide Seller, at Seller’s expense, with copies of the Books and
Records delivered to Buyer by Seller at Closing; and (iii) at Seller’s expense,
reasonably cooperate with Seller in all respects, including the making available
to Seller of Buyer’s employees as witnesses or deponents, in each case, in
respect of (1) financial reporting, (2) Tax or similar purposes, (3) purposes of
investigating Claims or pursuing Actions in respect of Third Parties or
Governmental Entities (4) addressing environmental matters involving Acquired
Assets or (5) any other proper purpose.  Buyer shall, and shall cause its
Affiliates to, keep and maintain the Books and Records delivered to Buyer by
Seller at Closing for a period of six (6) years from the Closing Date or such
longer periods as may be required by applicable Law; provided, however, that if
Buyer desires to destroy or dispose of any such records during or after the
expiration of such period, then Buyer will first offer to Seller in writing at
least sixty (60) days before such destruction or disposition to surrender such
records to Seller, and if Seller does not accept such offer within thirty (30)
days after receipt of such offer, then Buyer may take such action.
 
(b)           For a period of six (6) years from and after the Effective Time,
Seller shall and shall cause its Affiliates to, upon receipt of reasonable prior
written request from Buyer, (i) afford to Buyer and its Representatives
reasonable access during normal business hours to Seller’s employees and to
properties and records of Seller; (ii) provide Buyer, at Buyer’s expense, with
copies of any books, records or accounts relating to the Acquired Assets or the
Assumed Liabilities; and (iii) at Buyer’s expense, reasonably cooperate with
Buyer in all respects, including the making available to Buyer of Seller’s
employees as witnesses or
 
 
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deponents, in each case, in respect of (1) financial reporting, (2) Tax or
similar purposes, (3) purposes of investigating Claims or pursuing Actions in
respect of Third Parties or Governmental Entities (4) addressing environmental
matters involving Acquired Assets or (4) any other proper purpose.   If Seller
desires to destroy or dispose of any such records related to the Acquired Assets
or Assumed Liabilities during of after the expiration of such six (6) year
period, then Seller will first offer to Buyer in writing at least sixty (60)
days before such destruction or disposition to surrender such records to Buyer,
and if Buyer does not accept such offer within thirty (30) days after receipt of
such offer, then Seller may take such action.
 
6.3           Cooperation for Retained Claims.  With respect to all matters that
constitute Retained Liabilities or Assumed Liabilities and for so long as Seller
or Buyer, as applicable, is contesting or defending such matter in a Third Party
Action or any Claim, each Party shall cooperate (at no cost to the cooperating
Party) with the other Party, its respective Affiliates and their respective
counsel in their efforts to conduct or resolve such matters, including by making
available to them such documents and witnesses as may be deemed necessary or
useful therefore in that party’s reasonable discretion.
 
6.4           Excluded Intellectual Property.  Buyer agrees that it will not
use, and after Closing shall cause its Affiliates not to use, any of the
Excluded Intellectual Property.  Buyer acknowledges and agrees with Seller that
the Excluded Intellectual Property and the goodwill represented thereby and
pertaining thereto, are being retained by Seller and its Affiliates.  Within
sixty (60) days following the Closing Date, Buyer shall remove all
identifications of Excluded Intellectual Property from all Acquired Assets, line
markers materials, supplies, invoices or related items used by Buyer.  Buyer
will promptly, but in no event later than thirty (30) days after the Closing
Date, contact every appropriate one-call agency in the vicinity of the Acquired
Assets and have the contact information for one-calls changed from Seller’s or
its Affiliates’ name to Buyer’s name.  Buyer shall also provide revised maps to
the one-call agencies where appropriate or required.
 
6.5           Performance Bonds and Guaranties.  Buyer shall use its
commercially reasonable efforts to secure the unconditional release, as of the
Closing Date, of Seller from the Credit Support Instruments as to the Acquired
Assets, including effecting such release by providing guarantees or other
substitute credit support (but only to the extent that such substitute credit
support applies to the Acquired Assets), and Buyer shall use commercially
reasonable efforts to be substituted in all respects for Seller, so that the
Buyer shall be solely responsible for the obligations of such Credit Support
Instruments.  To the extent Buyer is unable to obtain the release of Seller or
the release of any Credit Support Instrument as to the Acquired Assets prior to
the Closing Date, Buyer shall indemnify Seller for any and all costs and Losses
arising from or relating to such Credit Support Instrument following the
Effective Time.  In the event that any Credit Support Instrument has not been
terminated and Seller has not been released as of the Closing Date, Seller shall
be permitted to terminate such Credit Support Instrument as to the Acquired
Assets as promptly as possible under the terms of such Credit Support
Instrument.  Seller shall reasonably cooperate with Buyer in assisting Buyer
with obtaining such releases to the Credit Support Instruments.
 
6.6           Insurance.  Buyer acknowledges and agrees that all insurance
policies maintained by Seller in respect of the Acquired Assets may be
terminated by Seller as of the
 
 
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Effective Time.  Buyer further agrees not to, and to require that no Affiliate
shall, make any Claims under such insurance policies.  Buyer agrees to arrange
insurance coverage for itself and the Acquired Assets as of the Effective Time
with insurers of its own choice.  Buyer further acknowledges that it has no
right, title or interest in any unearned premiums on any insurance policies
maintained by Seller.
 
6.7           Crude Oil Purchasing Agreement.  Buyer agrees that, if Seller or
any of its Affiliates shall, following the Closing, desire to purchase crude oil
from Plains Marketing, L.P. at MP 429,588 of the Pipeline, Buyer shall cause
Plains Marketing, L.P. to negotiate in good faith with Seller a crude oil
purchasing agreement on mutually agreeable terms.
 

 
ARTICLE VII
COVENANTS AND AGREEMENTS OF SELLER AND BUYER
 
7.1           Expenses.  Except as explicitly provided otherwise in this
Agreement or by applicable Law, all costs and expenses incurred by the Parties
in connection with the consummation of the transactions contemplated hereby
shall be borne solely and entirely by the Party which has incurred such
expenses.
 
7.2           Injunctions.  If any Governmental Entity having jurisdiction over
any Party issues or otherwise promulgates any Order that prohibits the
consummation of the transactions contemplated hereby, the Parties will use their
commercially reasonable efforts to (a) have such injunction dissolved or
otherwise eliminated as promptly as possible and (b) pursue any underlying
Action diligently and in good faith prior to and after the Closing.
 
7.3           Payments Received.  Seller and Buyer agree that after the Closing
they shall hold and promptly transfer and deliver to the other Party, from time
to time as and when received by them, any cash or checks with appropriate
endorsements (using their reasonable efforts not to convert such checks into
cash), or other property (including Tax refunds) that they may receive at or
after the Closing which properly belongs to the other Party.
 
7.4           [Reserved].
 
7.5           HSR Matters.  Buyer and Seller have each filed their respective
Notification Reports with the FTC respecting the transactions contemplated by
this Agreement and have requested early termination under the HSR Act.  Buyer
and Seller shall use their respective commercially reasonable efforts to (a)
obtain all authorizations or waivers required under the HSR Act to consummate
the transactions contemplated hereby, including making all filings with the
Antitrust Division of the DOJ and the FTC required in connection therewith and
(b) respond as promptly as practicable to all inquiries received from the DOJ or
the FTC for additional information or documentation.  Buyer shall be responsible
for paying all filing fees associated with filings under the HSR Act.  Each of
Buyer and Seller shall furnish to the other Party such necessary information and
reasonable assistance as the other may reasonably request in connection with its
preparation of any filing that is necessary under the HSR Act.  Buyer and Seller
shall keep each other apprised of the status of any communications with, and any
inquiries or requests for additional information from, the FTC or the DOJ.
Notwithstanding any term or
 
 
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provision set forth herein to the contrary, each of Buyer and Seller shall have
the right to terminate this Agreement, and their respective Affiliates shall
have the right to terminate the Terminal Asset Purchase Agreement upon receipt
from the DOJ or FTC of a second inquiry for additional information or
documentation after compliance by Seller and Buyer with any such initial inquiry
by the DOJ or FTC.  Notwithstanding anything to the contrary contained herein,
Buyer shall have no obligation to sell or divest any of its assets or any of the
assets of its Affiliates assets pursuant to any Divestiture Order, and Buyer’s
(or its Affiliates’) failure to sell or divest any of its assets shall not be
deemed to be a breach or default by Buyer of this Agreement.
 
7.6           Public Announcements.  No Party shall issue any press release or
other public announcement with respect to this Agreement or the transactions
contemplated hereby without the prior written approval of the other Party, not
to be unreasonably withheld; except as set forth on Schedule 7.6 or as may be
required by such Party or its Affiliates under applicable Law or stock exchange
rules.
 
7.7           Confidentiality.
 
(a)           The Parties agree to be bound by the terms and conditions of that
certain Confidentiality Agreement between Western Refining, Inc. and Plains
Marketing, L.P. entered into on September 28, 2010, as amended by that certain
Amendment to Confidentiality Agreement, dated August 30, 2011 (the
“Confidentiality Agreement”).  The Parties further agree that the terms and
conditions of this Agreement, the Ancillary Agreements and all other transaction
documents and all communications in connection with the negotiation of the
foregoing shall be deemed “Confidential Information” as such term is defined in,
and subject to, the terms of the Confidentiality Agreement.  Effective upon the
Closing, the Confidentiality Agreement shall terminate.
 
(b)           From and after the Closing, Seller shall, and shall cause its
Affiliates and their respective Representatives to keep confidential and not
disclose any information to any Person related to the transaction contemplated
herein (including any terms and conditions), except as may be approved by Buyer
(the “Restricted Information”).  The obligation to keep such Restricted
Information confidential shall continue for three (3) years from the Closing
Date and shall not apply to any information which (i) is in the public domain,
(ii) is published or otherwise becomes part of the public domain through no
fault of Seller or its Affiliates or (iii) becomes available to Seller or its
Affiliates on a non-confidential basis from a source that did not acquire such
information (directly or indirectly) from Seller or its
Affiliates.  Notwithstanding the foregoing, Seller may make disclosures as
required by applicable Law or any Governmental Entity and in connection with
disputes hereunder; provided that Seller, to the extent practicable, shall
deliver to Buyer written notice at least ten (10) Business Days prior to the day
Seller is to disclose any Restricted Information so that Buyer may seek a
protective order or other appropriate remedy or waive compliance with the
provisions of this Section.
 
7.8           Notice of Certain Events.  After the Closing Date, each Party
shall promptly notify the other Party of all notices, communications or Actions
initiated by any Governmental Entity and known to such Party with respect to the
Acquired Assets that would reasonably be
 
 
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expected to be a basis for an Indemnified Claim by an Indemnified Party pursuant
to Section 11.1.
 
7.9           Further Assurances.  After the Closing, each Party shall take such
further actions, including obtaining Consents from Third Parties, and execute
such further documents as may be reasonably necessary or reasonably requested by
any other Party in order to effectuate the intent of this Agreement and the
Ancillary Agreement and to provide such other Party with the intended benefits
of this Agreement and the Ancillary Agreements.
 
7.10           Tax Matters.
 
(a)           Preparation and Filing of Tax Returns.
 
(i)           With respect to any Tax Return related to the Acquired Assets for
a period ending on or before the Closing Date that is required to be filed on or
after the Closing Date by Buyer, Seller shall prepare such Tax Return in a
manner consistent with prior practices and deliver it to Buyer (along with
supporting documentation and with any payment (to be made by wire transfer)
required to be made with such Tax Return) at least ten (10) days prior to the
due date for such Tax Return.  Seller shall revise such Tax Return to reflect
any reasonable changes requested by Buyer and return the same to Buyer for
filing no later than two (2) Business Days before the date such Tax Return is
required to be filed.  Assuming Seller complies with all time requirements
contained in this Section 7.10(a)(i), Buyer shall timely file any such Tax
Return with the appropriate Taxing Authority and remit to such Taxing Authority
any amount received by Seller pursuant to this Section 7.10(a)(i).
 
(ii)           With respect to any Tax Return related to the Acquired Assets or
the Assumed Liabilities for a Straddle Period, Buyer shall provide a draft of
such Tax Return to Seller on or prior to the date that is ten (10) days prior to
the due date therefore, along with a supporting schedule that shows the
allocation of liability for Taxes due with such Tax Return pursuant to Section
7.10(b), for Seller’s review and comment.  Buyer shall revise such Tax Return to
reflect any reasonable changes requested by Seller and timely file such Tax
Return.
 
(b)           Allocation of Straddle Period Taxes.  In the case of Taxes that
are payable with respect to any Straddle Period, Seller shall be responsible for
the portion of any such Taxes that is attributable to the portion of the period
ending on the Closing Date, determined as follows:
 
(i)           in the case of Taxes that are either (A) based upon or related to
income or receipts, or (B) imposed in connection with any sale or other transfer
or assignment of property (real or personal, tangible or intangible), deemed
equal to the amount that would be payable if the Tax Period ended with (and
included) the Closing Date; provided, however, that exemptions, allowances or
deductions that are calculated on an annual basis (including depreciation and
amortization deductions) shall be allocated between the portion of the Straddle
Period ending on and including the day
 
 
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before the Closing Date and the period beginning on and after the Closing Date
in proportion to the number of days in each portion; and
 
(ii)           in the case of Taxes that are imposed on a periodic basis with
respect to the assets or capital, deemed to be the amount of such Taxes for the
entire Straddle Period (or, in the case of such Taxes determined on an arrears
basis, the amount of such Taxes for the immediately preceding period),
multiplied by a fraction the numerator of which is the number of calendar days
in the portion of the Straddle Period ending on and including the Closing Date
and the denominator of which is the number of calendar days in the entire
Straddle Period.  Specifically, all ad valorem, property and similar taxes
(“Property Taxes”) assessed with respect to the Acquired Assets for calendar
year 2011, or calendar year 2012, if applicable, shall be prorated between
Seller and Buyer based on their relative number of days of ownership of the
Acquired Assets during calendar year 2011 or calendar year 2012, if
applicable.  Seller shall pay to Buyer at Closing Seller’s share of the 2011
Property Taxes or the 2012 Property Taxes, if applicable.  To the extent the
actual amount of 2011 Property Taxes is not determinable at Closing, Buyer and
Seller shall utilize the most recent information available in estimating the
amount to be paid by Seller at Closing.  Upon determination of the actual amount
of 2011 Property Taxes and 2012 Property Taxes, if applicable, Seller shall pay
to Buyer within fifteen (15) days any additional amount necessary to equal
Seller’s share of the 2011 Property taxes and the 2012 Property Taxes, if
applicable; in the event the amount paid by Seller at Closing exceeds Seller’s
share of 2011 Property Taxes or the 2012 Property Taxes, if applicable, Buyer
shall refund within fifteen (15) days any such overage to Seller.
 
(c)           Refund and Tax Benefits.
 
(i)           Any Tax refunds related to the Acquired Assets or Assumed
Liabilities that are received by Buyer or any of its Affiliates, and any amount
credited against Taxes to which Buyer or any of its Affiliates become entitled,
that relate to Pre-Closing Tax Period or to the portion of a Straddle Period
that ends on the day before the Closing Date shall be for the account of Seller,
and Buyer shall pay over to Seller any such refund or the amount of any such
credit within fifteen (15) days after receipt or entitlement thereto.
 
(ii)           Any Tax refunds related to the Acquired Assets or Assumed
Liabilities that are received by Seller or any of its Affiliates, and any amount
credited against Taxes to which Seller or any of its Affiliates become entitled,
that relate to any post-Closing Tax Period or to the portion of a Straddle
Period that arises on or after the Closing Date shall be for the account of
Buyer, and Seller shall pay over to Buyer any such refund or the amount of any
such credit within fifteen (15) days after receipt or entitlement thereto.
 
(d)           Tax Assistance.  After the Closing Date, each Party shall provide
such assistance as the other Party may from time to time reasonably request in
connection with the preparation of Tax Returns required to be filed, any audit
or other examination by any taxing authority, any judicial or administrative
proceeding relating to liability for Taxes, or any Claim
 
 
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for refund in respect of such Taxes or in connection with any litigation and
proceedings or liabilities related to the Acquired Assets or the Assumed
Liabilities, including making available employees for interviews, litigation
preparation and testimony.  The requesting Party shall reimburse the assisting
Party for the reasonable out-of-pocket costs incurred by the assisting Party
after having received the prior written approval therefore from the requesting
Party.
 
(e)           Purchase Price Allocation.  The Parties agree to allocate the
Purchase Price (and all other capitalizable costs) among the Acquired Assets for
all purposes (including financial accounting and Tax purposes) as set forth on
Schedule 7.10(e) (the “Purchase Price Allocation”).  Seller and Buyer shall
report consistently with the Allocation in all Tax Returns, including IRS Form
8594, which Buyer and Seller shall timely file with the IRS, and neither Buyer
nor Seller shall take any position in any Tax Return that is inconsistent with
the Purchase Price Allocation unless required to do so by a final determination
as defined in Section 1313 of the Code.  Each of Seller and Buyer agree to
promptly advise each other regarding the existence of any Tax audit, controversy
or litigation related to the Purchase Price Allocation.
 
7.11           Real Estate Matters.  Seller shall, at no cost to Seller, use its
commercially reasonable efforts to cooperate with Buyer in (a) obtaining surveys
of and information and documentation relating to all Leased Real Property and
(b) obtaining a title insurance commitment covering all material Leased Real
Property.  All costs incurred in connection with the foregoing, including survey
and title insurance costs, shall be borne by Buyer.
 
7.12           Casualty Loss.
 
(a)           If, during the Interim Period, all or any portion of the Acquired
Assets are damaged or destroyed in whole or in part (the portion of the Acquired
Assets so damaged or destroyed, the “Damaged Portion”), whether by fire, theft,
vandalism, flood, wind, explosion or other casualty (a “Casualty Event”), Seller
shall notify Buyer promptly in writing (a “Casualty Event Notice”) of the
Casualty Event.  The Casualty Event Notice shall include: (i) a reasonable
description of the facts and circumstances surrounding the Casualty Event; (ii)
Seller’s preliminary assessment of the effect of the Casualty Event on the
Acquired Assets; and (iii) Seller’s preliminary assessment of whether, and the
extent to which, any losses sustained as a result of such Casualty Event are
covered by one or more insurance policies (including property/casualty and
workers’ compensation policies) maintained immediately prior to the Closing by
the Seller.
 
(b)           If: (i) Seller reasonably expects the Damaged Portion resulting
from a Casualty Event can be fully repaired or restored in accordance with
applicable Laws on or before 180 days following the occurrence of the Casualty
Event (the “Casualty Event Termination Date”); and (ii) the Casualty Event is
greater than $2,000,000.00, then Buyer may elect, in its sole discretion, to
either (A) repair and restore such Damaged Portion at Buyer’s expense, and Buyer
shall be entitled to all of the insurance proceeds which Seller or any of its
Affiliates actually receive with respect to such Casualty Event, or (B) notify
Seller that Buyer does not elect to repair and restore such Damaged Portion, at
which time Seller can elect to either (1) repair or restore such Damaged Portion
by the Casualty Event Termination Date, or (2) not repair or restore such
Damaged Portion by the Casualty Event Termination Date.  If Seller reasonably
expects the Damaged Portion resulting from a Casualty Event cannot be fully
repaired or
 
 
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restored in accordance with applicable Laws on or before the Casualty Event
Termination Date, then either Party may either (i) terminate this Agreement or
(ii) agree to a mutually acceptable solution related thereto.
 
(c)           If, with respect to any Casualty Event greater than $2,000,000
that Buyer elected not to repair and restore such Damaged Portion, Seller elects
to repair or restore such Damaged Portion by the Casualty Event Termination
Date, then: (i) Seller shall promptly commence and diligently execute the repair
and/or restoration of such Damaged Portion to the condition thereof immediately
prior to such Casualty Event in a good and workmanlike manner and in accordance
with applicable Laws at its sole cost and expense; (ii) Seller shall be entitled
to all of the insurance proceeds to which the Seller or any of its Affiliates
are entitled with respect to such Casualty Event; (iii) such Casualty Event
shall have no effect for purposes of determining whether Buyer’s conditions to
Closing set forth in Section 9.1 or Section 9.2 have been fulfilled; and (iv)
the Closing and the Termination Date shall be delayed for such reasonable time
as is necessary for Seller to complete any such repair or restoration.
 
(d)           If, with respect to any Casualty Event greater than $2,000,000
that Buyer elected not to repair and restore such Damaged Portion, Seller elects
not to repair or restore such Damaged Portion by the Casualty Event Termination
Date, then Buyer may elect by written notice to Seller not later than fifteen
(15) days after Buyer’s receipt of the Seller’s election not to repair or
restore such Damaged Portion to either: (A) proceed to Closing, and (i) neither
Party’s rights or obligations under this Agreement shall be affected in any way;
(ii) no breach of any representations or warranties under this Agreement shall
be deemed to have occurred as a result of such Casualty Event; and (iii) there
shall be a reduction in the amount of $2,000,000.00 to the Purchase Price; or
(B) elect not to close, at which time either Party may terminate this Agreement.
 
(e)           If the Casualty Event is $2,000,000.00 or less, then: (i) neither
Party’s rights or obligations under this Agreement shall be affected in any way;
(ii) no breach of any representations or warranties under this Agreement shall
be deemed to have occurred as a result of such Casualty Event; and (iii) there
shall be no change to the Purchase Price.
 
7.13           ROW.  Buyer and Seller shall use their commercially reasonable
efforts to enter into any agreement and cause third parties to enter into any
agreements required to ensure that Buyer has the use of any Overlapping ROW
Rights necessary for the operation of the Pipeline and Seller has the use of any
Overlapping ROW Rights necessary for the operation of Seller’s assets other than
the Pipeline currently located upon any Overlapping ROW Rights.  The obligation
of Buyer and Seller set forth in this Section 7.13 shall survive Closing.
 
ARTICLE VIII
[Reserved]
 
 
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ARTICLE IX
CONDITIONS TO CLOSING
 
9.1           Conditions to Each Party’s Obligation to Close.  The obligations
of Buyer and Seller to consummate the transactions contemplated by this
Agreement shall be subject to the satisfaction, at or prior to the Closing, of
each of the following conditions:
 
(a)           No Restraint.  No preliminary or permanent Order or other legal
restraint preventing the consummation of the transactions contemplated by this
Agreement shall be threatened or in effect.
 
(b)           Legality of Transactions.  No Action shall have been taken or
threatened and no Law shall have been enacted by any Governmental Entity that
makes illegal the performance by any Party of its obligations under this
Agreement or the Ancillary Agreements or the consummation of the transactions
contemplated by this Agreement.
 
(c)           HSR Waiting Period.  The waiting and review period (and any
extension thereof) under the HSR Act shall have expired or been terminated.
 
(d)           Closing under Terminal Asset Purchase Agreement.  Simultaneously
with the Closing of the transactions contemplated in this Agreement, the closing
of the transactions contemplated by the Terminal Asset Purchase Agreement shall
occur.
 
9.2           Conditions to Buyer’s Obligation to Close.
 
(a)           The obligation of Buyer to consummate the transactions
contemplated by this Agreement shall be subject to the satisfaction (or waiver
by Buyer), at or prior to the Closing, of each of the following conditions:
 
(i)           Representations and Warranties.  The representations and
warranties of Seller set forth in this Agreement shall be true and correct as of
the date of this Agreement and as of the Closing Date as though made on and as
of the Closing Date (except to the extent that such representations or
warranties speak as of an earlier date, in which case such representations and
warranties shall have been true and correct as of such specified date), except
to the extent that the failure of such representations and warranties to be true
and correct would not, in the aggregate, be reasonably expected to result in a
Material Adverse Effect, and Buyer shall have received a certificate to such
effect signed on behalf of Seller by an officer of Seller.
 
(ii)           Performance of Obligations.  Seller shall have performed in all
material respects the obligations required to be performed by it under this
Agreement prior to the Closing Date, and Buyer shall have received a certificate
to such effect signed on behalf of Seller by an officer of Seller.
 
(iii)           Ancillary Agreements.  Seller shall have executed and delivered,
or caused to be executed and delivered, the Ancillary Agreements; provided that
any failure of the Parties to reach final terms on and execute the Transition
Services Agreement shall not constitute a failure of a condition to close.
 
 
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(iv)           Material Consents.  Each of the Required Third Party Consents set
forth on Schedule 9.2(a)(iv) (the “Material Consents”) shall have been obtained.
 
(v)           Terminal Transaction.  Each of Buyer and Seller or their
respective Affiliates, as applicable, shall have performed in all respects its
respective obligations, agreements and covenants contained in the Terminal Asset
Purchase Agreement required to be performed on or prior to the Closing Date such
that transactions contemplated thereby have been consummated concurrently with
the Closing under this Agreement.
 
(vi)           Release of Liens.  Seller shall have provided Buyer with
documentation reasonably acceptable to Buyer which evidences that those liens
against the Acquired Assets set forth in Schedule 2.2(l) have been released.
 
(b)           Notwithstanding the foregoing, Buyer hereby grants a waiver in
respect of the closing condition set forth in Section 9.2(a)(iv) to the extent
Seller, upon Seller failing to deliver a Material Third Party Consent proposes a
reasonable and lawful arrangement pursuant to which Seller would provide Buyer
with the substantially the same economic claims, rights and benefits under the
Assumed Contract with respect to which the closing condition has not been
satisfied prior to the Closing.  Buyer shall cooperate in good faith, at
Seller’s expense, with Seller in any such arrangement.  To the extent Buyer is
able to so receive the economic claims, rights and benefits under any such
arrangement, Buyer shall be responsible for the Assumed Liabilities, if any,
arising out of or attributable to such Assumed Contract.  Notwithstanding any
such arrangement, Seller shall use its commercially reasonable efforts to assist
Buyer in obtaining the Material Consents as quickly as possible following the
Closing.
 
9.3           Conditions to Seller’s Obligation to Close.  The obligation of
Seller to consummate the transactions contemplated by this Agreement shall be
subject to the satisfaction (or waiver by Seller), at or prior to the Closing,
of each of the following conditions:
 
(a)           Representations and Warranties.  The representations and
warranties of Buyer set forth in this Agreement shall be true and correct in all
material respects as of the date of this Agreement and as of the Closing Date as
though made on and as of the Closing Date (except to the extent that such
representations or warranties speak as of an earlier date, in which case such
representations and warranties shall have been true and correct in all material
respects as of such specified date), except to the extent that the failure of
such representations and warranties to be true and correct would not, in the
aggregate, be reasonably expected to result in a Material Adverse Effect, and
Seller shall have received a certificate to such effect signed on behalf of
Buyer by an officer of the general partner of Buyer.
 
(b)           Performance of Obligations.  Buyer shall have performed in all
material respects the obligations required to be performed by it under this
Agreement prior to the Closing Date, and Seller shall have received a
certificate to such effect signed on behalf of Buyer by an officer of the
general partner of Buyer.
 
(c)           Ancillary Agreements.  Buyer shall have executed and delivered, or
caused to be executed and delivered, the Ancillary Agreements.
 
 
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(d)           Material Consents.  Each of the Material Consents shall have been
obtained.
 
(e)           Terminal Transaction.  Each of Buyer and Seller or their
respective Affiliates, as applicable, shall have performed in all respects its
respective obligations, agreements and covenants contained in the Terminal Asset
Purchase Agreement required to be performed on or prior to the Closing Date such
that transactions contemplated thereby have been consummated concurrently with
the Closing under this Agreement.
 
ARTICLE X
TERMINATION
 
10.1           Termination.  This Agreement may be terminated at any time prior
to the Closing:
 
(a)           by mutual written consent of Buyer and Seller;
 
(b)           by either Buyer or Seller if the Closing shall not have occurred
by 90 days following the Agreement Date; provided however that the Parties may
mutually extend such date up to two (2) times for thirty (30) day periods each
time (the “Termination Date”);
 
(c)           by either Buyer or Seller if a Governmental Entity shall have
issued an Order or taken any Action permanently restraining, enjoining, or
otherwise prohibiting the transactions contemplated by this Agreement, the
Ancillary Agreements, or the Terminal Asset Purchase Agreement and such Order or
Action shall have become final and nonappealable;
 
(d)           by either Buyer or Seller in the event of a breach by the other
Party of any representation, warranty, covenant or other agreement contained in
this Agreement, the Ancillary Agreements, or the Terminal Asset Purchase
Agreement which iv) would give rise to the failure of a condition set forth in
Section 9.2(a), or Section 9.3(a), and v) cannot be or has not been cured within
sixty (60) days following receipt by the breaching Party of written notice of
such breach;
 
(e)           by Buyer or Seller pursuant to Section 5.3;
 
(f)           by Buyer or Seller pursuant to Section 7.5;
 
(g)           by Buyer or Seller pursuant to Section 7.12; and
 
(h)           by Buyer, if Buyer is required to sell or divest any of its (or
its Affiliates) current assets or any of the Acquired Assets pursuant to any
Divestiture Order.
 
10.2           Effect of Termination.  Upon any termination of this Agreement,
(expressly excluding termination pursuant to Section 10.1(d) hereof), Seller and
Buyer shall be relieved of their respective duties and obligations arising under
this Agreement after the date of such termination, and such termination shall be
without liability to Seller or Buyer; provided that the provisions of Sections
10.2, 6.1(b), 7.1 and 7.7, Annex A and Article XII, shall survive any such
 
 
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termination and shall be enforceable hereunder and any defaulting party shall
remain liable under this Agreement for all of its liabilities and obligations
hereunder.
 
ARTICLE XI
INDEMNIFICATION
 
11.1           Obligations to Indemnify.
 
(a)           Seller’s Obligations.  Subject to the terms of this Article ‎XI,
from and after the Closing, Seller shall indemnify, defend and hold harmless the
Buyer Indemnified Parties from and against any and all Losses arising or
resulting from any one or more of the following:
 
(i)           the Retained Liabilities;
 
(ii)           the breach, non-fulfillment or non-performance by Seller of any
agreement, obligation or covenant of Seller in this Agreement to be performed by
Seller (or its Affiliates) on or prior to Closing;
 
(iii)           the breach, non-fulfillment or non-performance by Seller of any
agreement, obligation or covenant in this Agreement to be performed by Seller
(or its Affiliates) after Closing; or
 
(iv)           any breach or inaccuracy of any representation or warranty made
by Seller contained in this Agreement or any certificate delivered hereunder.
 
(b)           Buyer’s Obligation.  Subject to the terms of this Article ‎XI,
from and after the Closing, Buyer shall indemnify, defend and hold harmless the
Seller Indemnified Parties from and against any and all Losses arising or
resulting from any of the following:
 
(i)           the Assumed Liabilities;
 
(ii)           the breach, non fulfillment or nonperformance by Buyer of any
agreement, obligation or covenant of Buyer in this Agreement to be performed by
Buyer (or its Affiliates) on or prior to Closing;
 
(iii)           the breach, non-fulfillment or non-performance by Buyer of any
agreement, obligation or covenant in this Agreement to be performed by Buyer (or
its Affiliates) after Closing; or
 
(iv)           any breach or inaccuracy of any representation or warranty made
by Buyer contained in this Agreement or any certificate delivered hereunder.
 
11.2           Third Party Claims.
 
(a)           If any Indemnified Party receives written notice of the
commencement of any Action or proceeding or the assertion of any Claim by a
Third Party or the imposition of any penalty or assessment for which indemnity
may be sought under this Article ‎XI (a “Third Party
 
 
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Claim”), and such Indemnified Party intends to seek indemnity pursuant to this
Article ‎XI, the Indemnified Party shall promptly provide the other Party (the
“Indemnifying Party”) with notice of such Third Party Claim, which notice shall
describe such Third Party Claim in reasonable detail, including all relevant
factual background) and the basis on which the Indemnified Party is entitled to
indemnification hereunder.  The Indemnifying Party shall be entitled, at its
option and at its own expense, to assume the defense of such Third Party
Claim.  Such defense shall be conducted through counsel selected by the
Indemnifying Party and approved by the Indemnified Party, which approval shall
not be unreasonably withheld, delayed or conditioned, and the Indemnified Party
shall fully cooperate with the Indemnifying Party in connection therewith, at no
cost or expense to the Indemnified Party.
 
(b)           Notwithstanding the provisions of Section 11.2(a), each
Indemnified Party shall be entitled, at its own expense, to participate in the
defense of such Third Party Claim; provided, however, that the Indemnifying
Party shall pay the reasonable attorneys’ fees of the Indemnified Party if
vi) the employment of separate counsel shall have been authorized in writing by
any such Indemnifying Party in connection with the defense of such Third Party
Claim, or vii) the Indemnified Party’s counsel, reasonably competent to render
advice as to such matters shall have advised the Indemnified Party in writing,
with a copy delivered to the Indemnifying Party, that there is a conflict of
interest that could make it inappropriate under applicable standards of
professional conduct for the Indemnifying Party and the Indemnified Parties to
have common counsel.
 
(c)           The Indemnifying Party shall obtain the prior written approval of
each Indemnified Party (which approval shall not be unreasonably withheld,
delayed or conditioned) before entering into or making any settlement,
compromise, admission, or acknowledgment of the validity of any Third Party
Claim or any liability in respect thereof if, pursuant to or as a result of such
settlement, compromise, admission, or acknowledgment, any injunctive or other
equitable relief would be imposed against the Indemnified Party or if, in the
reasonable opinion of each Indemnified Party, such settlement, compromise,
admission, or acknowledgment could have an adverse effect on its business,
operations, assets or financial condition.
 
(d)           The Indemnifying Party shall not consent to the entry of any
judgment or enter into any settlement that does not include as an unconditional
term thereof the release by each claimant or plaintiff to each Indemnified Party
from all liability in respect of such Third Party Claim.
 
11.3           Direct Claims.
 
(a)           Notice of Indemnified Claims.  In any case in which an Indemnified
Party seeks indemnification hereunder which is not subject to Section ‎11.2
because no Third Party Claim is involved, the Indemnified Party shall promptly
notify the Indemnifying Party in writing of any Losses which such Indemnified
Party claims are subject to indemnification under the terms hereof (the
“Indemnified Claims”).  Subject to the limitations otherwise set forth in this
Article ‎XI, the failure of the Indemnified Party to exercise promptness in such
notification shall not amount to a waiver of such claim unless the resulting
delay materially prejudices the position of the Indemnifying Party with respect
to such claim.
 
 
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(b)           Contested Claims.  Each Indemnified Claim shall viii) reference
the indemnity claim to which it relates and shall state the date upon which such
indemnity claim was first asserted; ix) describe the nature of the Losses
incurred by the Indemnified Party; x) describe the reason why the Losses are
recoverable from the Indemnified Party; xi) state the amount of the Losses; and
xii) provide copies of all available documentation supporting the amount of the
Losses.  The Indemnifying Party shall have thirty (30) days following receipt of
an Indemnified Claim to review such claim (the “Review Period”).  The
Indemnified Party shall make a representative reasonably available during the
Review Period to respond to any questions by the Indemnifying Party concerning
the Indemnified Claim.  If the Indemnifying Party objects to all or any portion
of the Indemnified Claim (an “Objection”), the Indemnifying Party shall deliver
its Objection in writing to the Indemnified Party within the Review
Period.  Each such Objection shall state (a) if applicable, why the Indemnified
Claim is not recoverable from the Indemnifying Party; (b) the amount of Losses
objected to by the Indemnifying Party (the “Contested Amount”); and (c) if
applicable, the amount of the Losses not objected to by the Indemnifying Party
(the “Uncontested Amount”).
 
(c)           Uncontested Claims.  If the Indemnifying Party fails to tender an
Objection within the Review Period, the Indemnifying Party shall promptly (but
in any event within five (5) days after expiration of the Review Period) tender
payment to the Indemnified Party in the amount of the Indemnified Claim in
accordance with Section 11.8.  Upon the Indemnified Party’s receipt of any
Objection, the Uncontested Amount, if any, shall promptly (but in any event
within five (5) days after such receipt) be tendered by the Indemnifying Party
in accordance with Section 11.8.
 
11.4           Materiality.  In determining whether a breach or inaccuracy of
any representation or warranty made hereunder exists and in calculating the
amount of indemnifiable Losses incurred by any Indemnified Party arising out of
or relating to any such breach or inaccuracy, all qualifications relating to
“materiality,” “material,” “Material Adverse Effect” or any similar
qualification, shall be disregarded.
 
11.5           Limits of Liability.
 
(a)           Deductible; Cap.  No Indemnified Party shall be entitled to be
indemnified for Losses pursuant to Sections 11.1(a)(ii), 11.1(a)(iv) or
11.1(b)(iv) unless and until the respective aggregate amount of all such Losses
by such Indemnified Party exceeds 1.0% of the Purchase Price (the
“Deductible”).  The Indemnified Party shall be entitled to be paid the entire
amount of any Losses pursuant to Sections 11.1(a)(ii), 11.1(a)(iv) or
11.1(b)(iv) in excess of the Deductible; provided, however, that the aggregate
liability of Seller for Losses under this Agreement shall not exceed twenty five
percent (25.0%) of the Purchase Price (the “Cap”).  Notwithstanding the
foregoing, the Deductible and the Cap shall not apply to Seller’s or Buyer’s
indemnification obligations related to or arising out of any breach of the
Fundamental Representations (as defined herein) or for either Party’s
indemnification obligations pursuant to Section 11.1(a)(i) or (iii) or Section
11.1(b)(i) or (iii).
 
(b)           Minimum Claim.  If any claim or groups of related claims for
indemnification by an Indemnified Party that is indemnifiable under
Sections 11.1(a)(ii), 11.1(a)(iv) or 11.1(b)(iv) of this Agreement results in
respective aggregate Losses to such
 
 
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Indemnified Party that do not exceed $100,000, such Losses shall not be deemed
to be Losses under this Agreement shall not be applied against the Deductible
and shall not be eligible for indemnification under this Article ‎XI.
 
(c)           No Special Damages.  In no event shall any Indemnifying Party be
liable to any Indemnified Party with respect to any matter arising under or in
relation to this Agreement for any consequential, punitive, exemplary
incidental, indirect, special or punitive damages, including loss of future
revenue, income or profits, diminution of value or loss of business reputation
or opportunity or a multiple of revenue, income, profits or any other amount,
except to the extent such damages are included within a judgment rendered
against an Indemnified Party with respect to a Third Party Claim for which
indemnification is available under the terms of this Article ‎XI.
 
11.6           Survival of Covenants, Representations and Warranties.
 
(a)           The representations, warranties, covenants and agreements of the
Parties under this Agreement shall survive the execution and delivery of this
Agreement and shall continue in full force and effect until twelve (12) months
after the Closing Date; provided, however, that (i) the Fundamental
Representations shall survive until the expiration of the applicable statute of
limitation which shall begin tolling as of the Effective Time, and (ii) any
covenants or agreements contained in this Agreement that by their terms are to
be performed after the Closing Date shall survive until fully discharged.  The
date on which any such representation, warranty, covenant or agreement no longer
survives in accordance with this Section 11.6(a) is referred to herein as the
“Expiration Date”.
 
(b)           No action for a breach of any representation, warranty, covenant
or agreement contained herein shall be brought after the Expiration Date, except
for claims of which a Party has received written notice setting forth in
reasonable detail the claimed misrepresentation or breach of representation,
warranty, covenant or agreement with reasonable detail, prior to the Expiration
Date.
 
11.7           Exclusive Remedy.  After the Closing, the provisions of this
Article ‎XI shall be the exclusive basis for assertion of claims against, or the
imposition of liability on, any Party by another Party with respect to any
breach of, or other failure to meet any obligation under, this Agreement.
 
11.8           Payments.  All payments to be made by an Indemnifying Party to
any Indemnified Party pursuant to this Article ‎XI shall be made by wire
transfer of immediately available funds to an account designated by the
Indemnified Party.  Any payments pursuant to this Article ‎XI shall be treated
as an adjustment to the Purchase Price.
 
11.9           Administration of Indemnity Claims.  Notwithstanding anything
else in this Article ‎XI, any claim for indemnification pursuant to this
Article ‎XI, whether for a Third Party Claim pursuant to Section ‎11.2 or a
direct claim pursuant to Section ‎11.3, p) on behalf of a Buyer Indemnified
Party must be made and administered by Buyer, or its successors or assigns as
permitted herein, and q) on behalf of a Seller Indemnified Party must be made
and administered by Seller, or its successors and assigns as permitted herein.
 
 
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ARTICLE XII
MISCELLANEOUS
 
12.1           Notices.
 
(a)           Any notice or other communication given under this Agreement shall
be in writing and shall be i) delivered personally, ii) sent by documented
overnight delivery service, iii) sent by facsimile or other customary means of
electronic transmission (e.g., “pdf”), or iv) sent by first class mail, postage
prepaid (certified or registered mail, return receipt requested).  Such notice
shall be deemed to have been duly given (a) on the date of the delivery, if
delivered personally, (b) on the Business Day after dispatch by documented
overnight delivery service, if sent in such manner, (c) on the date of
electronic transmission, if so transmitted on a Business Day during normal
business hours, and otherwise on the next Business Day, or (d) on the fifth
(5th) Business Day after sent by first class mail, postage prepaid, if sent in
such manner.
 
(b)           Notices or other communications shall be directed to the following
addresses:
 
Notices to Seller:
 
Western Refining, Inc.
123 West Mills, Suite 200
El Paso, Texas 79901
Attention:  Lowry Barfield, Senior Vice President-Legal and General Counsel
Facsimile No.:  (915) 534-2650

with copies to:
 
Vinson & Elkins LLP
1001 Fannin Street, Suite 2500
Houston, Texas  77002
Attention:  Christopher S. Collins, Esq.
Facsimile No.:  (713) 615-5217

Notices to the Buyer:
 
Plains Pipeline, L.P.
333 Clay Street, Suite 1600
Houston, Texas 77002
Attention:  John R. Rutherford, Executive Vice President
Facsimile No.:  (713) 646-4378

 
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with copies to:
 
Plains Pipeline, L.P.
333 Clay Street, Suite 1600
Houston, Texas 77002
Attention:  Lawrence J. Dreyfuss, Vice President
Facsimile No.:  (713) 646-4216
 
(c)           The Parties may at any time change their address for service from
time to time by giving notice to the other Party in accordance with this Section
‎12.1.
 
12.2           Entire Agreement; Amendment; Waiver; Exhibits and
Schedules.  This Agreement and the Exhibits and Schedules attached hereto and
the Ancillary Agreements constitute the entire understanding between the Parties
with respect to the subject matter hereof, and supersede all other
understandings and negotiations with respect thereto (except for the
Confidentiality Agreement).  This Agreement may be amended only in a writing
signed by all Parties.  Any provision of this Agreement may be waived only in a
writing signed by the Party to be charged with such waiver.  No course of
dealing between the Parties shall be effective to amend or waive any provision
of this Agreement.  All Exhibits and Schedules attached hereto are hereby
incorporated into this Agreement as a part hereof.
 
12.3           Severability.  If any term or other provision of this Agreement
is invalid, illegal, or incapable of being enforced under applicable 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 herein are not affected in any manner
adverse to any Party.  Upon such determination that any term or other provision
of this Agreement is invalid, illegal, or incapable of being enforced, the
Parties shall negotiate in good faith to modify this Agreement so as to effect
the original intent of the Parties as closely as possible in a mutually
acceptable manner in order that the transactions contemplated herein are
consummated as originally contemplated to the fullest extent possible.
 
12.4           Parties in Interest.  This Agreement shall be binding upon and
inure solely to the benefit of each Party and its respective successors and
permitted assigns, and nothing in this Agreement, express or implied, is
intended to confer upon any other Person (other than the Indemnified Parties)
any rights or remedies of any nature whatsoever under or by reason of this
Agreement.
 
12.5           Governing Law.  This Agreement shall be governed by and construed
in accordance with the laws of the State of Texas (except to the extent that
mandatory provisions of federal law govern), without giving effect to any choice
or conflict of law provision or rule (whether of the State of Texas or any other
jurisdiction) that would cause the application of laws of any jurisdiction other
than those of the State of Texas.  Each of the Parties irrevocably agrees that
any legal action or proceeding with respect to the Acquired Assets, this
Agreement or any Ancillary Agreements or for recognition and enforcement of any
judgment in respect hereof shall be brought and determined in any federal or
state court located Houston, Harris County, Texas.  Each of the Parties hereby
(a) irrevocably submits with regard to any such action or proceeding
 
 
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to the exclusive personal jurisdiction of the aforesaid courts in the event any
dispute arises out of this Agreement or any transaction contemplated hereby and
waives the defense of sovereign immunity, (b) agrees that it shall not attempt
to deny or defeat such personal jurisdiction by motion or other request for
leave from any such court or that such action is brought in an inconvenient
forum and (c) agrees that it shall not bring any action relating to this
Agreement or any transaction contemplated hereby or the Acquired Assets in any
court other than the above courts.  Each of the Parties waives trial by jury in
any action to which they are parties involving, directly or indirectly, any
matter in any way arising out of, related to or connected with this Agreement or
the transactions contemplated hereby and thereby or the Acquired Assets.
 
12.6           Assignment.  This Agreement shall be binding upon and inure to
the benefit of the Parties and their successors and permitted assigns.  Seller
may not assign this Agreement or any rights or obligations hereunder with the
prior written consent of Buyer.  Buyer may not assign this Agreement or any
rights or obligations hereunder without the prior written consent of Seller,
which Seller shall not unreasonably withhold, condition or delay; provided that
Seller’s consent shall not be necessary for an assignment to an Affiliate or
Buyer; provided that such assignment shall not release Buyer from any
obligations hereunder.  Without Seller’s express written consent, no permitted
assignment of this Agreement or any rights or obligations hereunder by Buyer to
any other Person shall relieve Buyer of its obligations hereunder.
 
12.7           Dispute Resolution.
 
(a)           General.  The Parties agree that if any Dispute arises, it is in
the best interests of the Parties for such Dispute to be resolved in the
shortest time and with the lowest cost of resolution practicable.  Consequently,
the Parties agree to attempt to resolve any Dispute without resort to the
courts.  If any Dispute arises, the Parties shall comply with the following
procedures:
 
(i)           The Party believing a Dispute to exist will give the other Parties
prompt written notice thereof (the “Dispute Notice”), setting forth in
reasonable detail the facts alleged to give rise to such Dispute, any relevant
contractual provisions, the nature of any claimed default or breach and a
statement of the manner in which such Party believes the Dispute should be
resolved.
 
(ii)           Within thirty (30) days after receipt of any Dispute Notice, the
Party against whom relief is sought in connection with such Dispute Notice shall
deliver a written response (the “Dispute Response”), setting forth in reasonable
detail its views of the facts alleged to give rise to such Dispute, any relevant
contractual provisions, the nature of the claimed default or breach and a
statement of the manner in which such Party believes the Dispute should be
resolved.
 
(iii)           If the Parties do not agree on the manner in which the Dispute
should be resolved, they shall arrange to hold a meeting (a “Dispute Meeting”)
within thirty (30) days after delivery of the Dispute Response.  Each Party
shall have in attendance at such Dispute Meeting a representative with the
authority to resolve such Dispute.  At the Dispute Meeting (and any adjournments
thereof), the Parties shall negotiate in an attempt to agree as to whether a
Dispute exists, the exact nature of the Dispute and the manner in which the
Dispute should be
 
 
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resolved.  If deemed appropriate by the Parties, a mutually agreeable
professional mediator shall be engaged to assist in resolving the Dispute.  Any
resolution of the Dispute shall be evidenced by a written agreement setting
forth in reasonable detail the actions to be taken by each Party.  If no such
resolution is reached within thirty (30) days after the initial Dispute Meeting
(the “Dispute Negotiation Period”), the Parties may pursue binding arbitration
or legal action with respect to such Dispute pursuant to Section 16.1(b) or
Section 16.1(c), as applicable.
 
(b)           Mandatory Binding Arbitration.
 
(i)           If any Dispute is unresolved by the end of the Dispute Negotiation
Period, the Parties agree that any such Dispute for which the amount at issue
does not exceed $1,000,000 shall be determined by confidential, binding, neutral
arbitration as provided by the federal arbitration act and Texas substantive law
to be conducted in accordance with the JAMS Streamlined Arbitration Rules and
Procedures by a single neutral arbitrator.  The Parties agree that the
arbitrator shall be a retired United States federal district judge, and in the
event that no United States federal district judge is available, a retired
judge.  The Parties are giving up any rights each might possess to discovery and
appeal of such Disputes and to have such Disputes litigated in a court or by
jury trial.  The agreement to this provision is voluntary.
 
(ii)           Unless the Parties agree otherwise, and except as hereinafter
provided, the place of arbitration shall be Houston, Harris County, Texas.  The
arbitrators shall issue a reasoned written decision and award which shall not
exceed $1,000,000 including any interest, costs or any other amounts.
 
(iii)           The Parties shall bear equally the fees and expenses of the
arbitration, unless the arbitrators decide otherwise.  Each Party shall bear the
costs of its own counsel, witnesses (if any) and employees, unless the
arbitrators decide otherwise.
 
(iv)           If the Parties are unable to agree upon a single arbitrator
within twenty (20) days of the date on which the Dispute Negotiation Period
ends, each Party shall select an arbitrator within twenty-five (25) days of the
date on which the Dispute Negotiation Period ends.  If a Party fails to select
an arbitrator within such period, the Dallas, Texas office of JAMS shall appoint
an arbitrator for such Party.  The two individuals so selected shall select a
third individual who shall serve as the arbitrator of the Dispute.  The
arbitrator shall be selected no later than forty-five (45) days after the date
on which the Dispute Negotiation Period ends, and, if possible, shall be
experienced in legal and operational matters related to the industry of the
Parties.
 
(v)           The decision rendered by the arbitrator shall be considered the
final and binding resolution of the Dispute and will not be subject to
appeal.  No Party shall sue the other except for enforcement of the arbitrator’s
decision if the other Party is not performing in accordance with the
arbitrator’s decision.
 
(vi)           If any Dispute is unresolved by the end of the Dispute
Negotiation Period, the Parties agree that any such Dispute for which the amount
at issue exceeds $1,000,000, may be resolved in accordance with Texas law and
venue and jurisdiction for any litigation regarding such disputes shall be
exclusive in the state or federal court(s) of competent
 
 
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jurisdiction in Houston, County, Texas.  The Parties consent to and waive, to
the fullest extent permitted by applicable law, any objection which they may now
or hereafter have to the bringing of any such action or proceeding in such
jurisdiction.
 
(c)           The obligations of the Parties under this Section 12.7 shall
survive the expiration or termination of this Agreement.
 
12.8           Specific Performance.  The Parties acknowledge and agree that in
the event that any of the provisions of this Agreement are breached or are not
performed in accordance with their terms, irreparable damage may occur and that
the Parties may not have an adequate remedy at law.  It is accordingly agreed
that the Parties shall be entitled to injunctive or other equitable relief,
without the posting of any bond and without proof of actual damages, to prevent
breaches of this Agreement and to specifically enforce the terms of this
Agreement and that the Parties shall not object to the granting of injunctive or
other equitable relief on the basis that there exists an adequate remedy at law.
 
12.9           Counterparts.  This Agreement may be executed in two or more
counterparts, all of which shall be considered one and the same agreement and
shall become effective when two or more counterparts have been signed by each of
the parties and delivered to the other parties, it being understood that all
parties need not sign the same counterpart.  Delivery of an executed signature
page of this Agreement by facsimile or other customary means of electronic
transmission (e.g., “.pdf”) shall be effective as delivery of a manually
executed counterpart hereof.
 
12.10           Expenses.  Except as otherwise provided herein, each Party shall
bear its own expenses incurred in connection with this Agreement and the
transactions herein contemplated hereby whether or not such transactions shall
be consummated, including all fees of its legal counsel, financial advisers and
accountants.
 
[Signature Page to Follow]
 
 
38

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IN WITNESS WHEREOF, the Parties have executed this Agreement as of the date
first set forth above.
 

 
PLAINS PIPELINE, L.P.
   
By Plains Marketing GP Inc.,
   
Its General Partner
                   
By:
/s/Harry N. Pefanis
   
Name:
Harry N. Pefanis
   
Title:
President and Chief Operating Officer
                   
WESTERN REFINING PIPELINE COMPANY
                           
By:
/s/ Jeff A. Stevens
   
Name:
Jeff A. Stevens
   
Title:
President and Chief Executive Officer
 

 
 
 
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ANNEX A

Interpretation; Defined Terms

1.           Interpretation.  It is expressly agreed that this Agreement shall
not be construed against any Party, and no consideration shall be given or
presumption made, on the basis of who drafted this Agreement or any particular
provision hereof or who supplied the form of Agreement.  Each Party agrees that
this Agreement has been purposefully drawn and correctly reflects its
understanding of the transaction that this Agreement contemplates.  In
construing this Agreement:
 
(a)           examples shall not be construed to limit, expressly or by
implication, the matter they illustrate;
 
(b)           the word “includes” and its derivatives means “includes, but is
not limited to” and corresponding derivative expressions;
 
(c)           a defined term has its defined meaning throughout this Agreement
and each Exhibit, Annex and Schedule to this Agreement, regardless of whether it
appears before or after the place where it is defined;
 
(d)           each Exhibit, Annex, recital and Schedule to this Agreement is a
part of this Agreement, but if there is any conflict or inconsistency between
the main body of this Agreement and any Exhibit, Annex or Schedule, the
provisions of the main body of this Agreement shall prevail;
 
(e)           the headings and titles herein are for convenience only and shall
have no significance in the interpretation hereof;
 
(f)           the inclusion of a matter on a Schedule in relation to a
representation or warranty shall not be deemed an indication that such matter
necessarily would, or may, breach such representation or warranty absent its
inclusion on such Schedule;
 
(g)           any reference to a statute, regulation or law shall include any
amendment thereof or any successor thereto and any rules and regulations
promulgated thereunder;
 
(h)           currency amounts referenced herein, unless otherwise specified,
are in U.S. Dollars;
 
(i)           unless the context otherwise requires, all references to time
shall mean time in Houston, Texas;
 
(j)           whenever this Agreement refers to a number of days, such number
shall refer to calendar days unless Business Days are specified; and
 
(k)           if a term is defined as one part of speech (such as a noun), it
shall have a corresponding meaning when used as another part of speech (such as
a verb).
 
 
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2.           References, Gender, Number.  All references in this Agreement to an
“Article,” “Section” or “Exhibit” shall be to an Article, Section or Exhibit of
this Agreement, unless the context requires otherwise.  All references in this
Agreement to a “Schedule” shall be to the Disclosure Schedule, unless the
context requires otherwise.  Unless the context clearly requires otherwise, the
words “this Agreement,” “hereof,” “hereunder,” “herein,” “hereby,” or words of
similar import shall refer to this Agreement as a whole and not to a particular
Article, Section, subsection, clause or other subdivision hereof.  Whenever the
context requires, the words used herein shall include the masculine, feminine
and neuter gender, and the singular and the plural.
 
3.           Defined Terms.  Unless the context expressly requires otherwise,
the respective terms defined in this Section ‎3 shall, when used in this
Agreement, have the respective meanings herein specified, with each such
definition to be equally applicable both to the singular and the plural forms of
the term so defined.
 
“Acquired Assets” shall have the meaning set forth in Section 1.1. 
 
“Action” shall mean any Claim, action, suit, investigation, inquiry, proceeding,
condemnation or audit by or before any court or other Governmental Entity.
 
“Affiliate” shall mean, with respect to any Person, any other entity that
directly or indirectly (through one or more intermediaries or otherwise)
controls, is controlled by, or is under common control with such Person.  For
purposes of this definition, “control” when used with respect to any Person
means the power to direct the management and policies of such Person, directly
or indirectly, whether through the ownership of voting securities, by contract
or otherwise, and the terms “controlling” and “controlled” have correlative
meanings.
 
“Agreement” shall have the meaning set forth in the preamble.
 
“Agreement Date” shall have the meaning set forth in the preamble.
 
“Ancillary Agreements” shall mean Assumed Contracts Assignment, ROW Assignment,
Leased Real Property Assignment, Bill of Sale, Transition Services Agreement,
Seller Guaranty, and Buyer Guaranty.
 
“Assigned Intellectual Property” shall have the meaning set forth in Section
1.1(f).
 
“Assumed Contracts” shall have the meaning set forth in Section ‎1.1(d).
 
“Assumed Contracts Assignment” shall have the meaning set forth in
Section 2.2(c).
 
“Assumed Liabilities” shall have the meaning set forth in Section ‎1.3(a).
 
“Bill of Sale” shall have the meaning set forth in Section 2.2(b).
 
“Books and Records” shall have the meaning set forth in Section ‎1.1(e).
 
“Business” means the pipeline business conducted by Seller using the Pipeline as
of the Effective Date.
 
 
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“Business Day” means any day on which banks are open for business in Texas,
other than Saturday or Sunday.
 
“Buyer” shall have the meaning set forth in the preamble.
 
“Buyer Guaranty” shall have the meaning set forth in Section 2.3(i).
 
“Buyer Indemnified Parties” means Buyer and each of Buyer’s Affiliates including
permitted assigns and successors in interest.
 
“Cap” shall have the meaning set forth in Section 11.5(a).
 
“Casualty Event” shall have the meaning set forth in Section 7.12(a).
 
“Casualty Event Notice” shall have the meaning set forth in Section 7.12(a).
 
“Casualty Event Termination Date” shall have the meaning set forth in Section
7.12(b).
 
“Claim” means a dispute, claim, or controversy whether based on contract, tort,
strict liability, statute or other legal or equitable theory (including any
claim of fraud, misrepresentation or fraudulent inducement or any question of
validity or effect of an agreement).
 
“Closing” shall have the meaning set forth in Section ‎2.1.
 
“Closing Date” shall have the meaning set forth in Section ‎2.1.
 
“Closing Statement” shall have the meaning set forth in Section 2.2(e).
 
“Code” means the Internal Revenue Code of 1986, as amended.
 
“Confidentiality Agreement” shall have the meaning set forth in Section 7.7(a).
 
“Consents” means all 2) authorizations, approvals, consents or Orders of, or
registrations, declarations or filings with, or expiration of waiting periods
imposed by, any Governmental Entity, in each case that are necessary in order to
consummate the transactions contemplated by this Agreement and the other
Ancillary Agreements, and 3) consents and approvals of a Third Party necessary
to prevent any conflict with, violation or breach of, or default under, any
material Contracts.
 
“Contested Amount” shall have the meaning set forth in Section ‎11.3(b).
 
“Contract” shall mean any written agreement, indenture, instrument, note, bond,
loan, lease, sublease, deed of trust, assignment, mortgage, franchise, license
agreement, purchase order, binding bid or offer, binding term sheet or letter of
intent or memorandum, commitment, letter of credit, including any amendments or
modifications thereof.
 
“Credit Support Instruments” shall have the meaning set forth in Section 1.2(g).
 
 
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“Creditor’s Rights Exception” shall have the meaning set forth in Section 3.2.
 
“Custody Transfer Receipt” shall having the meaning set forth in Section 2.2(g).
 
“Damaged Portion” shall have the meaning set forth in Section 7.12(a).
 
“Deactivated Section” means that approximately forty-four (44) mile section of
the Pipeline north of the Lynch Station commencing at Lynch MP 474 and
terminating at MP 429.588.
 
“Deductible” shall have the meaning set forth in Section ‎11.5(a).
 
“Disclosure Schedule” shall have the meaning set forth in Article III.
 
“Dispute” means any dispute, controversy or claim whether based on contract,
tort, statute or other legal or equitable theory (including any claim of fraud,
misrepresentation or fraudulent inducement or any question of validity or effect
of this Agreement including this clause) arising out of or related to this
Agreement and/or any Ancillary Agreements (including any amendments, annexations
and extensions) of the breach thereof.
 
“Divestiture Order” means a ruling or request by a Governmental Entity which
obligates Buyer (or its Affiliates) to sell, divest, or hold separate any
particular assets, categories of assets or lines of business (represented by any
assets or lines of business of Buyer or any of its Affiliates), as a condition
to such Governmental Entity granting its approval under applicable law
(including the HSR Act) with respect to Buyer’s acquisition of the Acquired
Assets as contemplated hereby.
 
“Dispute Meeting” shall have the meaning set forth in Section 12.7(a)(iii).
 
“Dispute Negotiation Period” shall have the meaning set forth in Section
12.7(a)(iii).
 
“Dispute Notice” shall have the meaning set forth in Section 12.7(a)(i).
 
“Dispute Response” shall have the meaning set forth in Section 12.7(a)(ii).
 
“DOJ” means the United States Department of Justice.
 
“Effective Time” shall have the meaning set forth in Section ‎2.1.
 
“Environmental Law” means any and all applicable Law relating to pollution,
protection, preservation, remediation or restoration of the environment
(including, soils, sediments, subsurface soils, surface waters, groundwaters, or
atmosphere) or natural resources, including applicable Laws relating to Releases
or threatened Releases of Hazardous Materials, or otherwise relating to the
generation, manufacture, processing, distribution, use, treatment, storage,
transport, or handling of, or exposure of any Person or property to, Hazardous
Materials, including, the Clean Air Act, the Comprehensive Environmental
Response, Compensation, and Liability Act, the Superfund Amendments and
Reauthorization Act, the Resource Conservation and Recovery Act, the Toxic
Substances Control Act, the Federal Water Pollution Control Act,
 
 
 
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the Safe Drinking Water Act, the Federal Hazardous Materials Transportation Act,
the Occupational Safety and Health Act, the Marine Mammal Protection Act,
Endangered Species Act, the National Environmental Policy Act, and the Oil
Pollution Act, as each has been amended from time to time and all other
environmental conservation and protection laws.
 
“Environmental Permit” shall mean any Permit with respect to the Acquired Assets
that is required by applicable Environmental Law.
 
“ERISA” means the Employee Retirement Income Security Act of 1974, as amended.
 
“Exchange Act” means the Securities Exchange Act of 1934.
 
“Excluded Assets” shall have the meaning set forth in Section ‎1.2.
 
“Excluded Books and Records” shall have the meaning set forth in Section 1.2(b).
 
“Excluded Contracts” shall have the meaning set forth in Section ‎1.2(h).
 
“Excluded Intellectual Property” shall have the meaning set forth in
Section 1.2(i).
 
“Excluded Personal Property” shall have the meaning set forth in Section 1.2(a).
 
“Existing Permits” shall have the meaning set forth in Section 1.2(j).
 
“Expiration Date” shall have the meaning set forth in Section 11.6(a).
 
“Financial Encumbrances” means liens covering the Acquired Assets which secure
indebtedness of Seller or Seller’s Affiliates for borrowed money.  
 
“FTC” means the United States Federal Trade Commission.
 
“Fundamental Representations” shall mean Seller’s representations and warranties
contained in Section 3.1, Section 3.2, Section 3.3 and Section 3.7(a) and
Buyer’s representations and warranties contained in Section 4.1, Section 4.2 and
Section 4.3.  
 
“GAAP” means generally accepted accounting principles in the United States of
America.
 
“Governing Documents” means with respect to (a) a corporation, its articles or
certificate of incorporation and by-laws, (b) a partnership, its certificate of
limited partnership or partnership declaration, as applicable, and partnership
agreement, (c) a limited liability company, its certificate of formation and
limited liability company agreement and (d) any other Person, the other
organizational or governing documents of such Person.
 
“Governmental Entity” means any Federal, state, local or foreign court or
governmental agency, authority or instrumentality or regulatory body.
 
“Hazardous Material” shall mean any substance that, by its nature or its use, is
regulated or as to which liability might arise under any Environmental Law
including, any:  (a) chemical,
 
 
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product, material, substance or waste defined as or included in the definition
of “hazardous substance,” “hazardous material,” “hazardous waste,” “restricted
hazardous waste,” “extremely hazardous waste,” “solid waste,” “toxic waste,”
“extremely hazardous substance,” “toxic substance,” “toxic pollutant,”
“contaminant,” “pollutant,” or words of similar meaning or import found in any
Environmental Law, (b) petroleum hydrocarbons, petroleum products, petroleum
substances, natural gas, crude oil, or any components, fractions, or derivatives
thereof when Released into the environment, and (c) asbestos containing
materials, polychlorinated biphenyls, radioactive materials, urea formaldehyde
foam insulation, or radon gas.
 
“HSR Act” means the Hart Scott Rodino Antitrust Improvements Act of 1976.
 
“Indemnification Dispute” means any Dispute arising out of or in connection with
any claims for indemnification pursuant to Article XI.
 
“Indemnified Claims” shall have the meaning set forth in Section 11.3(a).
 
“Indemnified Parties” means the Buyer Indemnified Parties and the Seller
Indemnified Parties, as applicable.
 
“Indemnifying Party” shall have the meaning set forth in Section 11.2(a).
 
“Intellectual Property” means, in respect of any Person, any and all
intellectual property rights, under the Laws of the United States of America or
any other jurisdiction, including all Trademarks, know-how, copyrights,
copyright registrations and applications for registration, Patents, and all
other intellectual property rights (including internet domain names), whether
registered or not, including the goodwill related to the foregoing, that is
licensed to or owned by such Person.
 
“Interim Period” shall have the meaning set forth in Section ‎5.1(a).
 
“JAMS” means JAMS, Inc.
 
“Jal Station” means Seller’s leasehold interest pursuant to that certain New
Mexico State Land Office Lease BL 1935 (Jal Station) between Commissioner of
Public Lands and Western Refining Pipeline Company dated September 9, 2009
 
“Knowledge” and any variations thereof or words to the same effect shall mean 4)
with respect to Buyer:  William D. Edwards and L. David Rabinowitz; and 5) with
respect to Seller, all information actually known to the following persons: Mark
Smith and Ann Allen after making reasonable inquiry of the following employees:
Ron Copple.
 
“Law” means all applicable statutes, laws, rules, regulations, Orders,
ordinances, writs, injunctions, judgments and decrees of all Governmental
Entities.
 
“Leased Real Property” shall have the meaning set forth in Section 1.1(a).
 
“Leased Real Property Assignment” shall have the meaning set forth in
Section 2.2(a).
 
 
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“Liens” means, collectively, any mortgage, pledge, lien, claim, charge, security
interest, restriction, lease, tenancy, license, other possessory interest, right
of purchase, conditional sales obligation, restriction, covenant, condition or
other encumbrance of any kind.
 
“Linefill” means all condensate and crude oil owned by Third Parties as linefill
in the Pipeline.
 
“Losses” means any and all losses, costs, obligations, liabilities, settlement
payments, awards, judgments, fines, penalties, damages (including wrongful
death, personal injury or property damage), private or governmental
environmental response and cleanup costs (on-site or off-site), environmental
closure and post-closure financial assurance costs, private or governmental
natural resource damage claims, medical monitoring costs, expenses (including
those incurred with investigating, preparing, defending, bringing or prosecuting
any claim, action, suit or proceeding and including, but not limited to, all
costs and expenses of all attorneys, experts, and consultants in all tribunals
and whether or not legal proceedings are commenced by or against an Indemnified
Party and including, without limitation, those related to title gaps and other
title matters requiring curative work), deficiencies or other
charges.  Notwithstanding the foregoing, in determining the amount of any Losses
for which a Party is entitled to indemnification pursuant to ‎ARTICLE XI, the
amount of such Losses shall be reduced by all insurance proceeds or other Third
Party recoveries.
 
 “Lynch Station” means Seller’s leasehold interest pursuant to that certain
Lease Agreement dated July 1, 2006, between Daniel C. Berry, III, and Elizabeth
Berry (“Lessor”) and Giant Pipeline Company (n/k/a Western Refining Pipeline
Company) for 5.7797 acres at Lynch Pump Station.
 
 “Material Adverse Effect” means any occurrence, condition, change, event or
effect that that has a material and adverse effect on the Acquired Assets, taken
as a whole, or that materially impairs the ability of a Party or any of its
Affiliates to perform their respective obligations under this Agreement and the
other Ancillary Agreements to which they are parties or prevents the
consummation of the transactions contemplated hereby and thereby; provided,
however, that “Material Adverse Effect” shall exclude any occurrence, condition,
change, event or effect (i) generally affecting (a) the industries in which such
Party or any of its respective Affiliates operate; (b) the global economy or the
economy of the Unites States of America; or (c) any financial, capital, credit
or securities markets; or (ii) resulting from or relating to (a) any
fluctuations in interest or exchange rates or of the prices of steel, oil and
gas; (b) any changes in Law, GAAP or other accounting standards after the date
of this Agreement, or prospective changes in Law, GAAP or other accounting
standards, or any changes or prospective changes in the interpretation or
enforcement of any of the foregoing, or any changes or prospective changes in
general legal, regulatory or political conditions; (c) any default by the United
States of America on any of its debt obligations, or any change or prospective
change in the rating of debt obligations of the United States of America by one
or more Nationally Recognized Statistical Rating Organizations; (d) any outbreak
or escalation of hostilities, declared or undeclared acts of war, terrorism or
insurrection, or act of piracy; (e) any national emergency or the occurrence of
any other calamity or crisis, including pandemics, earthquakes, hurricanes,
tornados or other natural disasters, or changes in weather or climate in
general; (f) the announcement or pendency of the transactions contemplated by
this Agreement, including any termination of, reduction in or
 
 
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similar negative impact on relationships, contractual or otherwise, with any
customers, suppliers, distributors, partners, members, managers or employees of
Seller and its Affiliates due to the announcement or pendency of the
transactions contemplated by this Agreement; (g) any action taken by such Party
or its respective Affiliates that (A) is described in, and permitted to be taken
without consent under, this Agreement or (B) was taken at the other Party’s
request or upon its advance written consent pursuant to this Agreement, (h) the
failure by Seller to take any action that is prohibited by this Agreement to the
extent the other Party fails to give its prompt and unconditioned consent
thereto after a request therefore by the other Party; (i) any change resulting
or arising from the identity of, or any facts or circumstances relating to such
a Party or any of its respective Affiliates; (j) any actions taken by such a
Party or any of its respective Affiliates; (k) any change or prospective change
in the rating of debt obligations of such Party by one or more Nationally
Recognized Statistical Rating Organizations; (l) any change in the trading
prices or trading volume of such Party’s capital stock or its debt; (m) the
failure of such Party to meet internal or analysts’ expectations or projections;
and (n) the compliance by such Party with the terms of this Agreement; provided,
further, that any occurrence, condition, change, event or effect referred to in
clause (a) above may be taken into account in determining whether or not there
has been a Material Adverse Effect to the extent such occurrence, condition,
change, event or effect has a materially disproportionate adverse effect on the
Acquired Assets, taken as a whole, as compared to similar assets of third
Persons, in which case the incremental materially disproportionate impact or
impacts may be taken into account in determining whether or not there has been
or may be a Material Adverse Effect.
 
“Material Consent” shall have the meaning set forth in Section 9.2(a)(iv).
 
“Material Contract” shall mean any Contract with an actual or possible term of
one (1) year or more or having an aggregate or possible aggregate value in
excess of $100,000.00.
 
“Objection” shall have the meaning set forth in Section ‎11.3(b).
 
“Order” shall mean any order, writ, injunction, decree, compliance or consent
order or decree, settlement agreement, schedule and similar binding legal
agreement issued by or entered into with a Governmental Entity.
 
“Overlapping ROW Rights” shall mean any ROW Rights upon which the Pipeline and
Seller’s assets other than the Pipeline are located as of the Agreement Date.
 
“Party” and “Parties” shall have the meaning set forth in the preamble.
 
“Permits” shall mean any applicable permits, licenses, variances, exemptions,
Orders, franchises and approvals of any Governmental Entity.
 
 “Permitted Liens” shall mean any of the following matters:
 
 (a)any (i) inchoate Liens or similar charges constituting or securing the
payment of expenses which were incurred incidental to the operation, storage,
transportation, shipment, handling, repair, construction, improvement or
maintenance of the Acquired Assets, and (ii) materialman’s, mechanics’,
repairman’s, employees’, contractors’, operators’, warehousemen’s, barge or ship
owner’s and carriers’ Liens or other similar Liens, security
 
 
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interests or charges for liquidated amounts arising in the ordinary course of
business incidental to the operation of the Acquired Assets, in the case of (i)
and (ii) above, each securing amounts the payment of which is not delinquent and
that will be paid in the ordinary course of business or, if delinquent, that are
being contested in good faith with any Action to foreclose or attach any of the
Acquired Assets on account thereof properly stayed;
 
 (b)any Liens for Taxes not yet delinquent or, if delinquent, that are being
contested by Seller or any Affiliate of Seller in good faith in the ordinary
course of business and disclosed in Schedule 3.9;
 
 (c)any Liens or security interests reserved in any Assumed Contracts or in any
leases, rights of way or other real property interests conveyed as part of the
ROW Rights for rental or for compliance with the terms of such Assumed
Contracts, leases, rights of way or other real property interests, provided
payment of the debt secured is not delinquent or, if delinquent, is being
contested in good faith in the ordinary course of business, and any Liens
attached to the fee title interest of the Leased Real Property;
 
 (d)all prior reservations of minerals in and under or that may be produced from
any of the lands constituting part of the Acquired Assets or on which any part
of the Acquired Assets is located;
 
 (e)rights reserved to or vested in any Governmental Entity to control or
regulate any of the Acquired Assets and all Laws of such authorities, including
any building or zoning ordinances and all Environmental Law;
 
 (f)any Contract, easement, instrument, Lien, permit, amendment, extension or
other matter entered into by a Party in accordance with the terms of this
Agreement or in compliance with the approvals or directives of the other Party
made pursuant to this Agreement;
 
 (g)any Lien created by Buyer;
 
 (h)all Post-Closing Consents;
 
 (i)restrictive covenants, easements, rights-of-way (including utility
rights-of-way), servitudes, and other burdens and defects, imperfections or
irregularities of title that are disclosed in any title insurance commitments
obtained by Buyer covering any of the Leased Real Property or ROW Rights;
 
 (j)discrepancies, conflicts, shortages in area or boundary lines, encroachments
or protrusions, overlapping of improvements, or other matters: (i) that may
reasonably be expected to be shown or identified by a survey or physical
inspection (whether or not made) of the Leased Real Property or ROW Rights,
and/or (ii) that are in fact disclosed or identified in any surveys of the
Leased Real Property or ROW Rights that are obtained by Buyer; and
 
 (k)all liens, charges, encumbrances, defects or irregularities which,
individually or in the aggregate, do not materially detract from the value of
the Acquired Assets
 
 
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as currently used or materially interfere with the current operation or use of
the Acquired Assets or the Business.
 
Notwithstanding the foregoing, Permitted Liens shall not include Financial
Encumbrances.  
 
“Person” means any individual, firm, corporation, partnership, limited liability
company, trust, joint venture, Governmental Entity or other entity.
 
“Personal Property” shall have the meaning set forth in Section 1.1(b).
 
“Pipeline” shall have the meaning set forth in the recitals.
 
“Pipeline Reactivation” shall have the meaning set forth in Section 1.5(a).
 
“Pipeline Reactivation Costs” shall have the meaning set forth in Section
1.5(a).
 
“Post-Closing Consents” shall mean (a) any consent, approval or permit of, or
filing with or notice to, any Governmental Entity, railroad company or public
utility which has issued or granted any Permit, right of way, lease or other
authorizations permitting any part of any pipeline included in the Acquired
Assets to cross or be placed on land owned or controlled by such Governmental
Entity, railroad company or public utility; and (b) any Consent or Permit, or
filing with or notice to, any Governmental Entity or other Third Party that is
customarily obtained or made after closing in connection with transactions
similar in nature to the transactions contemplated hereby.
 
“Pre-Closing Tax Period” means any Tax Period ending on or before the Closing
Date and that portion of any Straddle Period ending on the Closing Date.
 
“Property Taxes” shall have the meaning set forth in Section 7.10(b)(ii).
 
“Purchase Price” shall have the meaning set forth in Section 1.4.
 
“Purchase Price Allocation” shall have the meaning set forth in Section 7.10(e).
 
“Reimbursable Costs” shall have the meaning set forth in Section 1.5(b).
 
 “Reimbursable Costs Cap” shall have the meaning set forth in Section 1.5(b).
 
 “Release” shall mean any depositing, spilling, leaking, pumping, pouring,
placing, emitting, discarding, abandoning, emptying, discharging, migrating,
injecting, escaping, leaching, dumping, or disposing into the environment.
 
 “Representatives” means, with respect to any Person, such Person’s officers,
directors, employees, agents and other representatives (including investment
bankers and underwriters or initial purchasers of securities, lenders and their
respective attorneys or consultants, and the attorneys or consultants retained
by such Person).
 
 “Required Third Party Consents” shall have the meaning set forth in Section
3.3.
 
 
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 “Restricted Information” shall have the meaning set forth in Section 7.7(b).
 
 “Retained Liabilities” shall have the meaning set forth in Section 1.3(b).
 
 “Review Period” shall have the meaning set forth in Section 11.3(b).
 
 “ROW Assignment” shall have the meaning set forth in Section 2.2(o).
 
 “ROW Rights” shall have the meaning set forth in Section 1.1(g).
 
 “Seller” shall have the meaning set forth in the preamble.
 
 “Seller Guaranty” shall have the meaning set forth in Section 2.2(h).
 
 “Seller Indemnified Parties” means Seller and each of Seller’s Affiliates,
permitted assigns and successors in interest.
 
 “Straddle Period” means any Tax period beginning on or before and ending after
the Closing Date.
 
 “Tax Period” means any period prescribed by any Government Entity for which a
Tax Return is required to be filed or a Tax is required to be paid.
 
 “Tax Return” means any return, declaration, report or similar statement
required to be filed with respect to any Taxes (including any attached
schedules) including any information return, claim for refund, amended return
and declaration of estimated Taxes.
 
  “Taxes” means any charges, fees, levies, excises or other assessments (and all
related interest, additions to tax and penalties) imposed by any Governmental
Entity.
 
 “Taxing Authority” means any Governmental Entity exercising any authority to
Tax or Tax regulatory authority.
 
 “Terminal Asset Purchase Agreement” means that certain Asset Purchase
Agreement, dated as of even date herewith, by and between Plains Marketing,
L.P., and Western Refining Yorktown, Inc., pursuant to which Plains Marketing,
L.P., shall acquire, among other things, that petroleum storage and distribution
terminal facility owned by Western Refining Yorktown, Inc. and located in
Grafton, Virginia.
 
 “Termination Date” shall have the meaning set forth in Section 10.1(b).
 
 “Third Party” means any Person other than the Parties and their respective
Affiliates.
 
 “Third Party Claim” shall have the meaning set forth in Section 11.2(a).
 
 “Trademarks” means any and all trademarks, trademark registrations, trademark
applications, service marks, service mark registrations, service mark
applications, trade dress, word marks, word mark registrations, word mark
applications, trade names and logos.
 
 
Annex A - 11

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 “Transaction” means the transactions contemplated by this Agreement and the
Ancillary Agreements.
 
 “Transition Services Agreement” shall have the meaning set forth in Section
2.2(d).
 
 “Uncontested Amount” shall have the meaning set forth in Section 11.3(b).
 

Annex A - 12

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