Exhibit 10.3
Execution Copy
CONTRIBUTION, CONVEYANCE AND
ASSUMPTION AGREEMENT
WILLIAMS PARTNERS L.P.

 

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TABLE OF CONTENTS

              ARTICLE I DEFINITIONS; RECORDATION     4  
1.1
  Definitions     4  
 
            ARTICLE II THE OFFERING AND RELATED TRANSACTIONS     7  
2.1
  Contribution of Gas Purchase Contract by WNGL to Holdings     7  
2.2
  Contribution of Gas Purchase Contract by Holdings to MCFS     7  
2.3
  Contribution by WES to GP LLC of an Interest in CTP     7  
2.4
  Contribution by GP LLC to the MLP of the CTP Interest     8  
2.5
  Contribution by WES to the MLP of its Remaining Interest in CTP     8  
2.6
  Contribution by WE to the MLP of an Interest in Discovery     8  
2.7
  Contribution by Williams Pipeline to the MLP of an Interest in Discovery     8
 
2.8
  Contribution by Holdings to the MLP of All of Its Interests in MCFS     9  
2.9
  Public Cash Contribution     9  
2.10
  MLP Receipt of Cash Contribution     9  
2.11
  MLP Cash Distribution to Holdings and Williams Pipeline     9  
2.12
  Conveyance and Contribution by the MLP to the OLLC of its Interests in MCFS,
CTP and Discovery     9  
 
            ARTICLE III ASSUMPTION OF CERTAIN LIABILITIES     10  
3.1
  Assumption of Gas Purchase Contract Liabilities by Holdings     10  
3.2
  Assumption of Gas Purchase Contract Liabilities by MCFS     10  
3.3
  Assumption of CTP Liabilities by GP LLC     10  
3.4
  Assumption of CTP Liabilities by the MLP     11  
3.5
  Assumption of CTP Remaining Liabilities by the MLP     11  
3.6
  Assumption of WE Discovery Liabilities by the MLP     11  
3.7
  Assumption of Williams Pipeline Discovery Liabilities by the MLP     11  
3.8
  Assumption of MCFS Liabilities by the MLP     12  
3.9
  Assumption of MLP Aggregate Liabilities by the OLLC     12  
3.10
  General Provisions Relating to Assumption of Liabilities     12  
 
            ARTICLE IV FURTHER ASSURANCES     12  
4.1
  Further Assurances     12  
4.2
  Other Assurances     12  
 
            ARTICLE V MISCELLANEOUS     13  
5.1
  Order of Completion of Transactions     13  
5.2
  Costs     13  
5.3
  Headings; References; Interpretation     13  
5.4
  Successors and Assigns     14  
5.5
  No Third Party Rights     14  
5.6
  Counterparts     14  
5.7
  Governing Law     14  
5.8
  Severability     14  
5.9
  Amendment or Modification     14  
5.10
  Integration     14  

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Execution Copy
CONTRIBUTION, CONVEYANCE AND ASSUMPTION AGREEMENT
     THIS CONTRIBUTION, CONVEYANCE AND ASSUMPTION AGREEMENT, dated as of
August 23, 2005, is entered into by and among Williams Energy Services, LLC, a
Delaware limited liability company (“WES”); Williams Partners GP LLC, a Delaware
limited liability company (“GP LLC”); Williams Partners L.P., a Delaware limited
partnership (the “MLP”); Williams Partners Operating LLC, a Delaware limited
liability company (the “OLLC”); Williams Energy, L.L.C., a Delaware limited
liability company (“WE”); Williams Discovery Pipeline LLC, a Delaware limited
liability company (“Williams Pipeline”); Williams Partners Holdings LLC, a
Delaware limited liability company (“Holdings”); and Williams Natural Gas
Liquids, Inc. (“WNGL”). The foregoing shall be referred to individually as a
“Party” and collectively as the “Parties.” Certain capitalized terms used are
defined in Article I hereof.
RECITALS
     WHEREAS, WES and GP LLC have formed the MLP pursuant to the Delaware
Revised Uniform Limited Partnership Act (the “Delaware Limited Partnership
Act”), for the purpose of, among other things, owning, operating and acquiring
certain assets of certain subsidiaries of The Williams Companies, Inc., a
Delaware corporation (“TWC”), used in the business of gathering, transporting
and processing natural gas and fractionating and storing natural gas liquids.
     WHEREAS, in order to accomplish the objectives and purposes in the
preceding recital, the following actions have been taken prior to the date
hereof:

  1.   Williams Midstream Natural Gas Liquids, Inc. (“WMNGL”) contributed the
Conway Storage East, Conway West and Mitchell storage assets, certain Conway
real estate, several easements and a letter of credit for storage abandonment to
Mid-Continent Fractionation and Storage, LLC (“MCFS”) in exchange for a
membership interest in MCFS.     2.   WNGL contributed a 50% undivided interest
in the Conway fractionator, all applicable contracts or agreements relating to
the contributed assets (including but not limited to the Conway fractionator
operating agreement) and certain Conway real estate to MCFS in exchange for a
membership interest in MCFS.     3.   ESPAGAS USA Inc. (“Espagas”) conveyed
certain Conway real estate to MCFS in exchange for a membership interest in
MCFS.     4.   MAPCO Inc. (“MAPCO”) conveyed certain Conway real estate to MCFS
in exchange for a membership interest in MCFS.     5.   WES formed GP LLC under
the terms of the Delaware Limited Liability Company Act (the “Delaware LLC Act”)
and contributed $1,000 in exchange for all of the membership interests in GP
LLC.     6.   GP LLC and WES formed the MLP, to which GP LLC contributed $20 and
WES contributed $980 in exchange for a 2% general partner interest and 98%
limited partner interest, respectively.

 

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  7.   WES acquired 100% of the membership interests in ENI British Borneo
Pipeline LLC (“ENIBBP”). Upon acquisition, the legal name of ENIBBP was changed
to Williams Discovery Pipeline LLC.     8.   The MLP formed the OLLC pursuant to
the Delaware LLC Act and contributed $1,000 in exchange for all of the
membership interests in the OLLC.     9.   WNGL formed Holdings pursuant to the
Delaware LLC Act and contributed $1,000 in exchange for all of the membership
interests in Holdings.     10.   WMNGL, WNGL, Espagas and MAPCO contributed all
of the outstanding membership interests in MCFS to Holdings in exchange for
membership interests in Holdings.     11.   Williams Mobile Bay Producer
Services, L.L.C. (“WMBPS”) formed Carbonate Trend Pipeline LLC (“CTP”) pursuant
to the Delaware LLC Act and contributed the Carbonate Trend Pipeline to CTP in
exchange for all of the membership interests in CTP.     12.   WMBPS distributed
all of the membership interests in CTP to Arctic Fox Assets, L.L.C. (“AFA”).    
13.   AFA distributed all of the membership interests in CTP to TWC, which in
turn, contributed those membership interests to WES.     14.   The MLP, TWC and
certain other TWC subsidiaries entered into the Amended and Restated Credit
Agreement, to, among other things, allow the MLP to borrow up to $75 million
under the Amended and Restated Credit Agreement for general partnership
purposes, including acquisitions.

     WHEREAS, on the date of this Agreement, the MLP will enter into a working
capital loan agreement with TWC providing for a $20 million revolving credit
facility.
     WHEREAS, concurrently with the consummation of the transactions
contemplated hereby, each of the following shall occur:

  1.   WNGL will contribute the Gas Purchase Contract to Holdings which, in
turn, will contribute the Gas Purchase Contract to MCFS.     2.   WES will
contribute membership interests in CTP with an aggregate value equal to 2% of
the equity value of the MLP at closing ($6.14 million) to GP LLC as a capital
contribution.     3.   GP LLC will contribute its membership interest in CTP to
the MLP in exchange for (a) a continuation of GP LLC’s 2% general partner
interest in the Partnership and (b) the Incentive Distribution Rights.

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  4.   WES will contribute its remaining membership interest in CTP to the MLP
in exchange for (a) 253,557 Common Units representing a 1.77% limited partner
interest in the MLP and (b) 887,450 Subordinated Units representing a 6.21%
limited partner interest in the MLP.     5.   WE will contribute a 23.33%
membership interest (the “WE Discovery Interest”) in Discovery Producer Services
LLC (“Discovery”) to the MLP in exchange for (y) 715,693 Common Units
representing a 5.01% limited partner interest in the MLP and (z) 2,504,925
Subordinated Units representing a 17.53% limited partner interest in the MLP.  
  6.   Williams Pipeline will contribute its 16.67% membership interest (the
“Williams Pipeline Discovery Interest”) in Discovery to the MLP, in exchange for
(y) 345,567 Common Units representing a 2.42% limited partner interest in the
MLP and (z) 1,209,486 Subordinated Units representing a 8.47% limited partner
interest in the MLP.     7.   Holdings will contribute all of the membership
interests in MCFS to the MLP in exchange for (a) 685,183 Common Units
representing a 4.80% limited partner interest in the MLP and (b) 2,398,139
Subordinated Units representing a 16.79% limited partner interest in the MLP.  
  8.   The public, through the underwriters of the Offering, will contribute
$107.5 million, $100.2 million net of the underwriters’ discounts and
commissions and structuring fees (the “Offering Proceeds”), to the MLP in
exchange for 5,000,000 Common Units representing a 35.00% limited partner
interest in the MLP.     9.   The MLP will use the Offering Proceeds to (a) pay
the underwriting discounts and commissions and structuring fees (which may be
withheld by the underwriters from the Offering Proceeds as payment thereof),
(b) pay transaction costs estimated to be $4.3 million (excluding the
underwriters’ discounts and commissions and structuring fees and net of a
reimbursement for certain expenses received from the underwriters), (c) provide
$12.8 million of additional working capital, (d) distribute $35.0 million to
Williams Pipeline to reimburse for certain capital expenditures incurred prior
to formation, (e) distribute $18.6 million to Holdings to reimburse for certain
capital expenditures incurred prior to formation and for the Gas Purchase
Contract, (f) distribute $3.8 million to WE to reimburse for certain capital
expenditures incurred prior to formation, (g) distribute $1.3 million to WES to
reimburse for certain capital expenditures incurred prior to formation and
(h) provide $24.4 million to make a capital contribution to Discovery to fund an
escrow account in connection with the Tahiti pipeline lateral expansion.     10.
  The MLP will convey its interests in MCFS, CTP and Discovery to the OLLC as a
capital contribution.

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  11.   The agreements of limited partnership and the limited liability company
agreements of the aforementioned entities will be amended and restated to the
extent necessary to reflect the applicable matters set forth above and in
Article II and Article III of this Agreement.

     NOW, THEREFORE, in consideration of their mutual undertakings and
agreements hereunder, the Parties undertake and agree as follows:
ARTICLE I
DEFINITIONS; RECORDATION
     1.1 Definitions. The following capitalized terms have the meanings given
below.
     “Acts” shall mean collectively the Delaware Limited Partnership Act and the
Delaware LLC Act.
     “Agreement” means this Contribution, Conveyance and Assumption Agreement.
     “Amended and Restated Credit Agreement” means the Amended and Restated
Credit Agreement, dated as of May 20, 2005, by and among TWC, the MLP, Northwest
Pipeline Corporation and Transcontinental Gas Pipe Line Corporation, as the
borrowers, the lenders named therein, Citicorp USA, Inc., as administrative
agent and collateral agent, Citibank, N.A. and Bank of America, N.A., as the
issuing banks, Bank of America, N.A., as syndication agent, JPMorgan Chase Bank,
N.A., the Bank of Nova Scotia and The Royal Bank of Scotland PLC, as
co-documentation agents, and Citigroup Global Markets Inc. and Banc of America
Securities LLC, as joint lead arrangers and co-book runners.
     “Common Units” has the meaning assigned to such term in the Partnership
Agreement.
     “CTP” has the meaning assigned to such term in Item 11 of the second
Recital of this Agreement.
     “CTP Aggregate Liabilities” shall mean, collectively, the CTP Liabilities
and the CTP Remaining Liabilities.
     “CTP Full Interest” shall mean, collectively, the CTP Interest and the CTP
Remaining Interest.
     “CTP Interest” has the meaning assigned to such term in Section 2.3.
     “CTP Liabilities” shall mean all liabilities and obligations relating to
the CTP Interest.
     “CTP Remaining Interest” has the meaning assigned to such term in
Section 2.5.
     “CTP Remaining Liabilities” shall mean all liabilities and obligations
relating to the CTP Remaining Interest.

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     “Delaware LLC Act” has the meaning assigned to such term in Item 5 of the
second Recital of this Agreement.
     “Delaware Limited Partnership Act” has the meaning assigned to such term in
the initial Recital of this Agreement.
     “Discovery” has the meaning assigned to such term in Item 5 of the third
Recital of this Agreement.
     “Discovery Aggregate Liabilities” shall mean, collectively, the WE
Discovery Liabilities and the Williams Pipeline Discovery Liabilities.
     “Discovery Interest” has the meaning assigned to such term in Section 2.12.
     “Effective Date” means August 23, 2005.
     “Effective Time” means the time when the transactions contemplated by
Article II hereof have been consummated.
     “Espagas” has the meaning assigned to such term in Item 3 of the second
Recital of this Agreement.
     “Gas Purchase Contract” shall mean that Base Contract for Sale and Purchase
of Natural Gas, dated August 15, 2005, between WNGL and Williams Power Company,
Inc.
     “Gas Purchase Contract Liabilities” shall mean all liabilities and
obligations relating to the Gas Purchase Contract.
     “GP LLC” has the meaning assigned to such term in the first paragraph of
this Agreement.
     “Holdings” has the meaning assigned to such term in the first paragraph of
this Agreement.
     “Incentive Distribution Rights” has the meaning assigned to such term in
the Partnership Agreement.
     “Laws” means any and all laws, statutes, ordinances, rules or regulations
promulgated by a governmental authority, orders of a governmental authority,
judicial decisions, decisions of arbitrators or determinations of any
governmental authority or court.
     “MAPCO” has the meaning assigned to such term in Item 4 of the second
Recital of this Agreement.
     “MCFS” has the meaning assigned to such term in Item 1 of the second
Recital of this Agreement.
     “MCFS Interest” has the meaning assigned to such term in Section 2.8.

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     “MCFS Liabilities” shall mean all liabilities and obligations relating to
the MCFS Interest.
     “MLP” has the meaning assigned to such term in the first paragraph of this
Agreement.
     “MLP Aggregate Interests” has the meaning assigned to such term in
Section 2.12.
     “MLP Aggregate Liabilities” shall mean, collectively, the MCFS Liabilities,
the CTP Aggregate Liabilities and the Discovery Aggregate Liabilities.
     “Offering” means the initial public offering and transfer of title of
5,000,000 Common Units by the MLP to the public.
     “Offering Proceeds” has the meaning assigned to such term in Item 8 of the
third Recital of this Agreement.
     “OLLC” has the meaning assigned to such term in the first paragraph of this
Agreement.
     “Omnibus Agreement” means the Omnibus Agreement dated of even date
herewith, among WES, WE, Williams Pipeline, Holdings, GP LLC, the MLP, the OLLC,
and, for purposes of Articles V and VI thereof only, TWC.
     “Partnership Agreement” means the Agreement of Limited Partnership of the
MLP, as it may be amended and restated from time to time.
     “Partnership Group” has the meaning assigned to such term in the Omnibus
Agreement.
     “Party and Parties” have the meanings assigned to such terms in the first
paragraph of this Agreement.
     “Registration Statement” means the registration statements on Form S-1
(File Nos. 333-124517 and 333-127655) filed by the MLP relating to the Offering.
     “Subordinated Units” has the meaning assigned to such term in the
Partnership Agreement.
     “TWC” has the meaning assigned to such term in the initial Recital of this
Agreement.
     “WE” has the meaning assigned to such term in the first paragraph of this
Agreement.
     “WE Discovery Interest” has the meaning assigned to such term in Item 5 of
the third Recital of this Agreement.
     “WE Discovery Liabilities” shall mean all liabilities and obligations
relating to the WE Discovery Interest.
     “WES” has the meaning assigned to such term in the first paragraph of this
Agreement.

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     “Williams Pipeline” has the meaning assigned to such term in the first
paragraph of this Agreement.
     “Williams Pipeline Discovery Interest” has the meaning assigned to such
term in Item 6 of the third Recital of this Agreement.
     “Williams Pipeline Discovery Liabilities” shall mean all liabilities and
obligations relating to the Williams Pipeline Discovery Interest.
     “WMBPS” has the meaning assigned to such term in Item 11 of the second
Recital of this Agreement.
     “WMNGL” has the meaning assigned to such term in Item 1 of the second
Recital of this Agreement.
     “WNGL” has the meaning assigned to such term in the first paragraph of this
Agreement.
ARTICLE II
THE OFFERING AND RELATED TRANSACTIONS
     2.1 Contribution of Gas Purchase Contract by WNGL to Holdings. WNGL hereby
grants, contributes, transfers, assigns and conveys to Holdings, its successor
and assigns, for its and their own use forever, all of its right, title and
interest in and to the Gas Purchase Contract, and Holdings hereby accepts the
Gas Purchase Contract, subject to all matters to be contained in the instruments
of conveyance covering the Gas Purchase Contract to evidence such contribution
and conveyance, if any.
     TO HAVE AND TO HOLD the Gas Purchase Contract unto Holdings, its successors
and assigns, together with all and singular the rights and appurtenances thereto
in anywise belonging, subject, however, to the terms and conditions stated in
this Agreement, and in such instruments of conveyance, forever.
     2.2 Contribution of Gas Purchase Contract by Holdings to MCFS. Holdings
hereby grants, contributes, transfers, assigns and conveys to MCFS, its
successor and assigns, for its and their own use forever, all of its right,
title and interest in and to the Gas Purchase Contract, and MCFS hereby accepts
the Gas Purchase Contract, subject to all matters to be contained in the
instruments of conveyance covering the Gas Purchase Contract to evidence such
contribution and conveyance, if any.
     TO HAVE AND TO HOLD the Gas Purchase Contract unto MCFS, its successors and
assigns, together with all and singular the rights and appurtenances thereto in
anywise belonging, subject, however, to the terms and conditions stated in this
Agreement, and in such instruments of conveyance, forever.
     2.3 Contribution by WES to GP LLC of an Interest in CTP. WES hereby grants,
contributes, transfers, assigns and conveys to GP LLC, its successors and
assigns, for its and their own use forever, membership interests in CTP with an
aggregate value equal to 2% of the

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equity value of the MLP at the closing of the Offering ($6.14 million) (the “CTP
Interest”), and GP LLC hereby accepts the CTP Interest.
     TO HAVE AND TO HOLD the CTP Interest unto GP LLC, its successors and
assigns, together with all and singular the rights and appurtenances thereto in
anywise belonging, subject, however, to the terms and conditions stated in this
Agreement, forever.
     2.4 Contribution by GP LLC to the MLP of the CTP Interest. GP LLC hereby
grants, contributes, transfers, assigns and conveys to the MLP, its successors
and assigns, for its and their own use forever, all of the CTP Interest, and the
MLP hereby accepts the CTP Interest as an additional capital contribution in
exchange for (a) a continuation of GP LLC’s 2% general partner interest in the
MLP and (b) the Incentive Distribution Rights.
     TO HAVE AND TO HOLD the CTP Interest unto the MLP, its successors and
assigns, together with all and singular the rights and appurtenances thereto in
anywise belonging, subject, however, to the terms and conditions stated in this
Agreement, forever.
     2.5 Contribution by WES to the MLP of its Remaining Interest in CTP. WES
hereby grants, contributes, transfers, assigns and conveys to the MLP, its
successors and assigns, for its and their own use forever, all of its remaining
membership interests in CTP (collectively, the “CTP Remaining Interest”), and
the MLP hereby accepts the CTP Remaining Interest as an additional capital
contribution in exchange for (a) 253,557 Common Units representing a 1.77%
limited partner interest in the MLP and (b) 887,450 Subordinated Units
representing a 6.21% limited partner interest in the MLP.
     TO HAVE AND TO HOLD the CTP Remaining Interest unto the MLP, its successors
and assigns, together with all and singular the rights and appurtenances thereto
in anywise belonging, subject, however, to the terms and conditions stated in
this Agreement, forever.
     2.6 Contribution by WE to the MLP of an Interest in Discovery. WE hereby
grants, contributes, transfers, assigns and conveys to the MLP, its successors
and assigns, for its and their own use forever, the WE Discovery Interest, and
the MLP hereby accepts the WE Discovery Interest as an additional capital
contribution in exchange for (a) 715,693 Common Units representing a 5.01%
limited partner interest in the MLP and (b) 2,504,925 Subordinated Units
representing a 17.53% limited partner interest in the MLP.
     TO HAVE AND TO HOLD the WE Discovery Interest unto the MLP, its successors
and assigns, together with all and singular the rights and appurtenances thereto
in anywise belonging, subject, however, to the terms and conditions stated in
this Agreement, forever.
     2.7 Contribution by Williams Pipeline to the MLP of an Interest in
Discovery. Williams Pipeline hereby grants, contributes, transfers, assigns and
conveys to the MLP, its successors and assigns, for its and their own use
forever, the Williams Pipeline Discovery Interest, and the MLP hereby accepts
the Williams Pipeline Discovery Interest as an additional capital contribution
in exchange for (a) 345,567 Common Units representing a 2.42% limited partner
interest in the MLP and (b) 1,209,486 Subordinated Units representing a 8.47%
limited partner interest in the MLP.

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     TO HAVE AND TO HOLD the Williams Pipeline Discovery Interest unto the MLP,
its successors and assigns, together with all and singular the rights and
appurtenances thereto in anywise belonging, subject, however, to the terms and
conditions stated in this Agreement, forever.
     2.8 Contribution by Holdings to the MLP of All of Its Interests in MCFS.
Holdings hereby grants, contributes, transfers, assigns and conveys to the MLP,
its successors and assigns, for its and their own use forever, all of its right,
title and interest in and to its 100% membership interest in MCFS (the “MCFS
Interest”), and the MLP hereby accepts the MCFS Interest as an additional
capital contribution in exchange for (a) 685,183 Common Units representing a
4.80% limited partner interest in the MLP and (b) 2,398,139 Subordinated Units
representing a 16.79% limited partner interest in the MLP.
     TO HAVE AND TO HOLD the MCFS Interest unto the MLP, its successors and
assigns, together with all and singular the rights and appurtenances thereto in
anywise belonging, subject, however, to the terms and conditions stated in this
Agreement, forever.
     2.9 Public Cash Contribution. The Parties acknowledge the cash contribution
of the Offering Proceeds from the public, through the underwriters, to the MLP
in connection with the Offering in exchange for 5,000,000 Common Units
representing a 35.00% limited partner interest in the MLP.
     2.10 MLP Receipt of Cash Contribution. The MLP acknowledges receipt of the
Offering Proceeds in cash as a capital contribution to the MLP, and the Parties
acknowledge that the MLP has used all of such capital contribution to (a) pay
the underwriting discounts and commissions and structuring fees (which may be
withheld by the underwriters from the Offering Proceeds as payment thereof), (b)
pay transaction costs estimated to be $4.3 million (excluding the underwriters’
discount and commissions and structuring fees and net of a reimbursement for
certain expenses received from the underwriters), (c) provide $12.8 million of
additional working capital, (d) distribute $35.0 million to Williams Pipeline to
reimburse for certain capital expenditures incurred prior to formation,
(e) distribute $18.6 million to Holdings to reimburse for certain capital
expenditures incurred prior to formation and for the Gas Purchase Contract,
(f) distribute $3.8 million to WE to reimburse for certain capital expenditures
incurred prior to formation, (g) distribute $1.3 million to WES to reimburse for
certain capital expenditures incurred prior to formation and (h) provide
$24.4 million to make a capital contribution to Discovery to fund an escrow
account in connection with the Tahiti pipeline lateral expansion.
     2.11 MLP Cash Distribution to Holdings and Williams Pipeline. The Parties
acknowledge the distribution by the MLP of $35.0 million to Holdings,
$18.6 million to Williams Pipeline, $3.8 million to WE and $1.3 million to WES,
respectively, and the receipt by Holdings, Williams Pipeline, WES and WE,
respectively, of such amounts from the MLP. A portion of each of the above
distributions has been made to satisfy the reimbursement for capital
expenditures of the above respective parties.
     2.12 Conveyance and Contribution by the MLP to the OLLC of its Interests in
MCFS, CTP and Discovery. The MLP hereby grants, contributes, transfers, assigns
and conveys to the OLLC, its successors and assigns, for its and their own use
forever, all of its right,

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title and interest in and to (a) the MCFS Interest, (b) the CTP Full Interest
and (c) its 40% membership interest in Discovery (the “Discovery Interest” and,
together with the MCFS Interest and the CTP Full Interest, the “MLP Aggregate
Interests”) and the OLLC hereby accepts the MLP Aggregate Interests as an
additional capital contribution.
     TO HAVE AND TO HOLD the MLP Aggregate Interests unto the OLLC, its
successors and assigns, together with all and singular the rights and
appurtenances thereto in anywise belonging, subject, however, to the terms and
conditions stated in this Agreement, forever.
ARTICLE III
ASSUMPTION OF CERTAIN LIABILITIES
     3.1 Assumption of Gas Purchase Contract Liabilities by Holdings. In
connection with the contribution by WNGL of the Gas Purchase Contract to
Holdings, as set forth in Section 2.1 above, Holdings hereby assumes and agrees
to duly and timely pay, perform and discharge all of the Gas Purchase Contract
Liabilities, to the full extent that WNGL has been heretofore or would have been
in the future obligated to pay, perform and discharge the Gas Purchase Contract
Liabilities were it not for the execution and delivery of this Agreement;
provided, however, that said assumption and agreement to duly and timely pay,
perform and discharge the Gas Purchase Contract Liabilities shall not
(a) increase the obligation of Holdings with respect to the Gas Purchase
Contract Liabilities beyond that of WNGL, (b) waive any valid defense that was
available to WNGL with respect to the Gas Purchase Contract Liabilities or
(c) enlarge any rights or remedies of any third party under any of the Gas
Purchase Contract Liabilities.
     3.2 Assumption of Gas Purchase Contract Liabilities by MCFS. In connection
with the contribution by Holdings of the Gas Purchase Contract to MCFS, as set
forth in Section 2.2 above, MCFS hereby assumes and agrees to duly and timely
pay, perform and discharge all of the Gas Purchase Contract Liabilities, to the
full extent that Holdings has been heretofore or would have been in the future
obligated to pay, perform and discharge the Gas Purchase Contract Liabilities
were it not for the execution and delivery of this Agreement; provided, however,
that said assumption and agreement to duly and timely pay, perform and discharge
the Gas Purchase Contract Liabilities shall not (a) increase the obligation of
MCFS with respect to the Gas Purchase Contract Liabilities beyond that of
Holdings, (b) waive any valid defense that was available to Holdings with
respect to the Gas Purchase Contract Liabilities or (c) enlarge any rights or
remedies of any third party under any of the Gas Purchase Contract Liabilities.
     3.3 Assumption of CTP Liabilities by GP LLC. In connection with the
contribution by WES of the CTP Interest to GP LLC, as set forth in Section 2.3
above, GP LLC hereby assumes and agrees to duly and timely pay, perform and
discharge all of the CTP Liabilities, to the full extent that WES has been
heretofore or would have been in the future obligated to pay, perform and
discharge the CTP Liabilities were it not for the execution and delivery of this
Agreement; provided, however, that said assumption and agreement to duly and
timely pay, perform and discharge the CTP Liabilities shall not (a) increase the
obligation of GP LLC with respect to the CTP Liabilities beyond that of WES,
(b) waive any valid defense that was available to WES with respect to the CTP
Liabilities or (c) enlarge any rights or remedies of any third party under any
of the CTP Liabilities.

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     3.4 Assumption of CTP Liabilities by the MLP. In connection with the
contribution by GP LLC to the MLP of the CTP Interest as set forth in
Section 2.4 above, the MLP hereby assumes and agrees to duly and timely pay,
perform and discharge all of the CTP Liabilities, to the full extent that GP LLC
has been heretofore or would have been in the future obligated to pay, perform
and discharge such obligations and liabilities were it not for the execution and
delivery of this Agreement; provided, however, that said assumption and
agreement to duly and timely pay, perform and discharge the CTP Liabilities
shall not (a) increase the obligation of the MLP with respect to the CTP
Liabilities beyond that of GP LLC, (b) waive any valid defense that was
available to GP LLC with respect to the CTP Liabilities or (c) enlarge any
rights or remedies of any third party under any of the CTP Liabilities.
     3.5 Assumption of CTP Remaining Liabilities by the MLP. In connection with
the contribution by WES to the MLP of the CTP Remaining Interest as set forth in
Section 2.5 above, the MLP hereby assumes and agrees to duly and timely pay,
perform and discharge all of the CTP Remaining Liabilities, to the full extent
that WES has been heretofore or would have been in the future obligated to pay,
perform and discharge such obligations and liabilities were it not for the
execution and delivery of this Agreement; provided, however, that said
assumption and agreement to duly and timely pay, perform and discharge the CTP
Remaining Liabilities shall not (a) increase the obligation of the MLP with
respect to the CTP Remaining Liabilities beyond that of WES, (b) waive any valid
defense that was available to WES with respect to the CTP Remaining Liabilities
or (c) enlarge any rights or remedies of any third party under any of the CTP
Remaining Liabilities.
     3.6 Assumption of WE Discovery Liabilities by the MLP. In connection with
the contribution by WE to the MLP of the WE Discovery Interest as set forth in
Section 2.6 above, the MLP hereby assumes and agrees to duly and timely pay,
perform and discharge all of the WE Discovery Liabilities, to the full extent
that WE has been heretofore or would have been in the future obligated to pay,
perform and discharge such obligations and liabilities were it not for the
execution and delivery of this Agreement; provided, however, that said
assumption and agreement to duly and timely pay, perform and discharge the WE
Discovery Liabilities shall not (a) increase the obligation of the MLP with
respect to the WE Discovery Liabilities beyond that of WE, (b) waive any valid
defense that was available to WE with respect to the WE Discovery Liabilities or
(c) enlarge any rights or remedies of any third party under any of the WE
Discovery Liabilities.
     3.7 Assumption of Williams Pipeline Discovery Liabilities by the MLP. In
connection with the contribution by Williams Pipeline to the MLP of the Williams
Pipeline Discovery Interest as set forth in Section 2.7 above, the MLP hereby
assumes and agrees to duly and timely pay, perform and discharge all of the
Williams Pipeline Discovery Liabilities, to the full extent that Williams
Pipeline has been heretofore or would have been in the future obligated to pay,
perform and discharge such obligations and liabilities were it not for the
execution and delivery of this Agreement; provided, however, that said
assumption and agreement to duly and timely pay, perform and discharge the
Williams Pipeline Discovery Liabilities shall not (a) increase the obligation of
the MLP with respect to the Williams Pipeline Discovery Liabilities beyond that
of Williams Pipeline, (b) waive any valid defense that was available to Williams
Pipeline with respect to the Williams Pipeline Discovery Liabilities or
(c) enlarge any rights or remedies of any third party under any of the Williams
Pipeline Discovery Liabilities.

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     3.8 Assumption of MCFS Liabilities by the MLP. In connection with the
contribution by Holdings to the MLP of the MCFS Interest as set forth in
Section 2.8 above, the MLP hereby assumes and agrees to duly and timely pay,
perform and discharge all of the MCFS Liabilities, to the full extent that
Holdings has been heretofore or would have been in the future obligated to pay,
perform and discharge such obligations and liabilities were it not for the
execution and delivery of this Agreement; provided, however, that said
assumption and agreement to duly and timely pay, perform and discharge the MCFS
Liabilities shall not (a) increase the obligation of the MLP with respect to the
MCFS Liabilities beyond that of Holdings, (b) waive any valid defense that was
available to Holdings with respect to the MCFS Liabilities or (c) enlarge any
rights or remedies of any third party under any of the MCFS Liabilities.
     3.9 Assumption of MLP Aggregate Liabilities by the OLLC. In connection with
the contribution by the MLP to the OLLC of the MLP Aggregate Interests as set
forth in Section 2.12 above, the OLLC hereby assumes and agrees to duly and
timely pay, perform and discharge all of the MLP Aggregate Liabilities, to the
full extent that the MLP has been heretofore or would have been in the future
obligated to pay, perform and discharge such obligations and liabilities were it
not for the execution and delivery of this Agreement; provided, however, that
said assumption and agreement to duly and timely pay, perform and discharge the
MLP Aggregate Liabilities shall not (a) increase the obligation of the OLLC with
respect to the MLP Aggregate Liabilities beyond that of the MLP, (b) waive any
valid defense that was available to the MLP with respect to the MLP Aggregate
Liabilities or (c) enlarge any rights or remedies of any third party under any
of the MLP Aggregate Liabilities.
     3.10 General Provisions Relating to Assumption of Liabilities.
Notwithstanding anything to the contrary contained in this Agreement including,
without limitation, the terms and provisions of this Article III, none of the
Parties shall be deemed to have assumed, and none of the interests have been or
are being contributed subject to, any liens or security interests securing
consensual indebtedness covering any of the interests, and all such liens and
security interests shall be deemed to be excluded from the assumptions of
liabilities made under this Article III.
ARTICLE IV
FURTHER ASSURANCES
     4.1 Further Assurances. From time to time after the date hereof, and
without any further consideration, the Parties agree to execute, acknowledge and
deliver all such additional deeds, assignments, bills of sale, conveyances,
instruments, notices, releases, acquittances and other documents, and will do
all such other acts and things, all in accordance with applicable law, as may be
necessary or appropriate (a) more fully to assure that the applicable Parties
own all of the properties, rights, titles, interests, estates, remedies, powers
and privileges granted by this Agreement, or which are intended to be so
granted, (b) more fully and effectively to vest in the applicable Parties and
their respective successors and assigns beneficial and record title to the
interests contributed and assigned by this Agreement or intended so to be and
(c) to more fully and effectively carry out the purposes and intent of this
Agreement.
     4.2 Other Assurances. From time to time after the date hereof, and without
any further consideration, each of the Parties shall execute, acknowledge and
deliver all such additional instruments, notices and other documents, and will
do all such other acts and things,

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all in accordance with applicable law, as may be necessary or appropriate to
more fully and effectively carry out the purposes and intent of this Agreement.
It is the express intent of the Parties that the MLP or its subsidiaries own all
assets necessary to operate the assets that are identified in this Agreement and
in the Registration Statement. To the extent any assets were not identified but
are necessary to the operation of assets that were identified, then the intent
of the Parties is that all such unidentified assets are intended to be conveyed
to the appropriate members of the Partnership Group. To the extent such assets
are identified at a later date, the Parties shall take the appropriate actions
required in order to convey all such assets to the appropriate members of the
Partnership Group. Likewise, to the extent that assets are identified at a later
date that were not intended by the parties to be conveyed as reflected in the
Registration Statement, the Parties take the appropriate actions required in
order to convey all such assets to the appropriate party.
ARTICLE V
MISCELLANEOUS
     5.1 Order of Completion of Transactions. The transactions provided for in
Article II and Article III of this Agreement shall be completed on the Effective
Date in the following order:
     First, the transactions provided for in Article II shall be completed in
the order set forth therein; and
     Second, the transactions provided for in Article III shall be completed in
the order set forth therein.
     5.2 Costs. The OLLC shall pay all sales, use and similar taxes arising out
of the contributions, conveyances and deliveries to be made hereunder, and shall
pay all documentary, filing, recording, transfer, deed, and conveyance taxes and
fees required in connection therewith.
     5.3 Headings; References; Interpretation. All Article and Section headings
in this Agreement are for convenience only and shall not be deemed to control or
affect the meaning or construction of any of the provisions hereof. The words
“hereof,” “herein” and “hereunder” and words of similar import, when used in
this Agreement, shall refer to this Agreement as a whole and not to any
particular provision of this Agreement. All references herein to Articles and
Sections shall, unless the context requires a different construction, be deemed
to be references to the Articles and Sections of this Agreement, respectively.
All personal pronouns used in this Agreement, whether used in the masculine,
feminine or neuter gender, shall include all other genders, and the singular
shall include the plural and vice versa. The use herein of the word “including”
following any general statement, term or matter shall not be construed to limit
such statement, term or matter to the specific items or matters set forth
immediately following such word or to similar items or matters, whether or not
non-limiting language (such as “without limitation,” “but not limited to,” or
words of similar import) is used with reference thereto, but rather shall be
deemed to refer to all other items or matters that could reasonably fall within
the broadest possible scope of such general statement, term or matter.

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     5.4 Successors and Assigns. The Agreement shall be binding upon and inure
to the benefit of the parties signatory hereto and their respective successors
and assigns.
     5.5 No Third Party Rights. The provisions of this Agreement are intended to
bind the parties signatory hereto as to each other and are not intended to and
do not create rights in any other person or confer upon any other person any
benefits, rights or remedies and no person is or is intended to be a third party
beneficiary of any of the provisions of this Agreement.
     5.6 Counterparts. This Agreement may be executed in any number of
counterparts, all of which together shall constitute one agreement binding on
the parties hereto.
     5.7 Governing Law. This Agreement shall be governed by, and construed in
accordance with, the laws of the State of Texas applicable to contracts made and
to be performed wholly within such state without giving effect to conflict of
law principles thereof, except to the extent that it is mandatory that the law
of some other jurisdiction, wherein the interests are located, shall apply.
     5.8 Severability. If any of the provisions of this Agreement are held by
any court of competent jurisdiction to contravene, or to be invalid under, the
laws of any political body having jurisdiction over the subject matter hereof,
such contravention or invalidity shall not invalidate the entire Agreement.
Instead, this Agreement shall be construed as if it did not contain the
particular provision or provisions held to be invalid, and an equitable
adjustment shall be made and necessary provision added so as to give effect to
the intention of the Parties as expressed in this Agreement at the time of
execution of this Agreement.
     5.9 Amendment or Modification. This Agreement may be amended or modified
from time to time only by the written agreement of all the Parties hereto and
affected thereby.
     5.10 Integration. This Agreement and the instruments referenced herein
supersede all previous understandings or agreements among the Parties, whether
oral or written, with respect to its subject matter. This Agreement and such
instruments contain the entire understanding of the Parties with respect to the
subject matter hereof and thereof. No understanding, representation, promise or
agreement, whether oral or written, is intended to be or shall be included in or
form part of this Agreement unless it is contained in a written amendment hereto
executed by the Parties hereto after the date of this Agreement.

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     IN WITNESS WHEREOF, this Agreement has been duly executed by the parties
hereto as of the date first above written.

                  WILLIAMS ENERGY SERVICES, LLC,
a Delaware limited liability company    
 
           
 
  By:   /s/ Alan S. Armstrong    
 
                Name: Alan S. Armstrong         Title: Senior Vice President    
 
           
 
      “WES”    
 
                WILLIAMS PARTNERS GP LLC,
a Delaware limited liability company    
 
           
 
  By:   /s/ Alan S. Armstrong    
 
                Name: Alan S. Armstrong         Title: Chief Operating Officer  
 
 
           
 
      “GP LLC”    
 
                WILLIAMS PARTNERS L.P.,
a Delaware limited partnership    
 
                By: Williams Partners GP LLC, its general partner    
 
           
 
  By:   /s/ Alan S. Armstrong    
 
                Name: Alan S. Armstrong         Title: Chief Operating Officer  
 
 
           
 
      “MLP”    

 

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                  WILLIAMS PARTNERS OPERATING LLC,
a Delaware limited liability company    
 
                By: WILLIAMS PARTNERS L.P., its sole member    
 
                By: Williams Partners GP LLC, its general partner    
 
           
 
  By:   /s/ Alan S. Armstrong    
 
                Name: Alan S. Armstrong         Title: Chief Operating Officer  
 
 
           
 
      “OLLC”    
 
                WILLIAMS ENERGY, L.L.C.,
a Delaware limited liability company    
 
           
 
  By:   /s/ Alan S. Armstrong    
 
                Name: Alan S. Armstrong         Title: Senior Vice President and
General Manager – Business
          Development
 
           
 
      “WE”    
 
                WILLIAMS DISCOVERY PIPELINE LLC,
a Delaware limited liability company    
 
           
 
  By:   /s/ Alan S. Armstrong    
 
                Name: Alan S. Armstrong         Title: Senior Vice President and
General Manager    
 
           
 
      “Williams Pipeline”    

 

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                  WILLIAMS PARTNERS HOLDINGS LLC,
a Delaware limited liability company    
 
           
 
  By:   /s/ Alan S. Armstrong    
 
                Name: Alan S. Armstrong         Title: Chief Operating Officer  
 
 
           
 
      “Holdings”    
 
                WILLIAMS NATURAL GAS LIQUIDS, INC.,
a Delaware corporation    
 
           
 
  By:   /s/ Alan S. Armstrong    
 
                Name: Alan S. Armstrong         Title: Senior Vice President and
General Manager    
 
           
 
      “WNGL”