Exhibit 10.2

 

Execution Copy

 

 

INTERIM 364-DAY CREDIT AGREEMENT

 

PLAINS ALL AMERICAN PIPELINE, L.P., as Borrower,

 

JPMORGAN CHASE BANK, N.A.,

 

as Administrative Agent,

 

BANK OF AMERICA, N.A. and CITIBANK, N.A.,

 

as Co-Syndication Agents,

 

WACHOVIA BANK, NATIONAL ASSOCIATION and UBS SECURITIES LLC,

 

as Co-Documentation Agents,

 

and CERTAIN FINANCIAL INSTITUTIONS, as Lenders

 

$1,000,000,000 364-Day Revolving Credit Facility

 

JPMORGAN SECURITIES INC. and CITIGROUP GLOBAL MARKETS INC.

 

as Joint Bookrunners and Co-Lead Arrangers

 

July 31, 2006

 

 

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TABLE OF CONTENTS

 

 

Page

 

 

 

ARTICLE I. - Definitions and References

 

1

Section 1.1.

Defined Terms

1

Section 1.2.

Exhibits and Schedules; Additional Definitions.

18

Section 1.3.

Amendment of Defined Instruments

18

Section 1.4.

References and Titles

18

Section 1.5.

Calculations and Determinations

18

 

 

 

ARTICLE II. - The Loans

 

19

Section 2.1.

Commitments to Lend; Notes.

19

Section 2.2.

Requests for Loans

19

Section 2.3.

Continuations and Conversions of Existing Loans

20

Section 2.4.

Use of Proceeds

21

Section 2.5.

Interest Rates and Fees

22

Section 2.6.

Intentionally deleted

22

Section 2.7.

Conversion to Term Loan

23

Section 2.8.

Optional Prepayments

23

Section 2.9.

Mandatory Commitment Reductions and Prepayments

23

 

 

 

ARTICLE III. - Payments to Lenders

 

24

Section 3.1.

General Procedures

24

Section 3.2.

Capital Reimbursement

26

Section 3.3.

Increased Cost of Eurodollar Loans

26

Section 3.4.

Notice; Change of Applicable Lending Office

27

Section 3.5.

Availability

27

Section 3.6.

Funding Losses

27

Section 3.7.

Reimbursable Taxes

28

Section 3.8.

Replacement of Lenders

29

Section 3.9.

Currency Conversion and Indemnity

29

 

 

 

ARTICLE IV. - Conditions Precedent to Lending

 

30

Section 4.1.

Documents to be Delivered – Closing Date

30

Section 4.2.

Additional Conditions Precedent

32

Section 4.3.

Initial Funding Date – Conditions Precedent

32

 

 

 

ARTICLE V. -  Representations and Warranties

33

Section 5.1.

No Default

33

Section 5.2.

Organization and Good Standing

33

Section 5.3.

Authorization

34

Section 5.4.

No Conflicts or Consents

34

Section 5.5.

Enforceable Obligations

34

Section 5.6.

Initial Financial Statements

34

Section 5.7.

Other Obligations and Restrictions

34

 

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Section 5.8.

Full Disclosure

 

Section 5.9.

Litigation

35

Section 5.10.

ERISA Plans and Liabilities

35

Section 5.11.

Compliance with Permits, Consents and Law

35

Section 5.12.

Environmental Laws

36

Section 5.13.

Borrower’s Subsidiaries

36

Section 5.14.

Title to Properties

36

Section 5.15.

Government Regulation

36

Section 5.16.

Insider

37

Section 5.17.

Solvency

37

 

 

 

ARTICLE VI. - Affirmative Covenants

37

Section 6.1.

Payment and Performance

37

Section 6.2.

Books, Financial Statements and Reports

37

Section 6.3.

Other Information and Inspections

38

Section 6.4.

Notice of Material Events

39

Section 6.5.

Maintenance of Existence, Qualifications and Assets

40

Section 6.6.

Payment of Taxes, etc.

40

Section 6.7.

Insurance

41

Section 6.8.

Compliance with Agreements and Law

41

Section 6.9.

Guaranties of Subsidiaries

41

 

 

 

ARTICLE VII. -  Negative Covenants

42

Section 7.1.

Subsidiary Indebtedness

42

Section 7.2.

Limitation on Liens

42

Section 7.3.

Limitation on Mergers

44

Section 7.4.

Limitation on New Businesses

45

Section 7.5.

Transactions with Affiliates

45

Section 7.6.

Limitation on Distributions

46

Section 7.7.

Restricted Contracts

46

Section 7.8.

Debt Coverage Ratio

46

Section 7.9.

Intentionally Deleted

48

Section 7.10.

Unrestricted Subsidiaries

48

Section 7.11.

No Negative Pledges

49

 

 

 

ARTICLE VIII. - Events of Default and Remedies

49

Section 8.1.

Events of Default

49

Section 8.2.

Remedies

51

 

 

 

ARTICLE IX. – Administrative Agent

52

Section 9.1.

Appointment and Authority

52

Section 9.2.

Rights as a Lender

52

Section 9.3.

Exculpatory Provisions

52

Section 9.4.

Reliance by Administrative Agent

53

Section 9.5.

Delegation of Duties

53

Section 9.6.

Resignation of Administrative Agent

53

Section 9.7.

Non-Reliance on Administrative Agent and Other Lenders

54

 

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Section 9.8.

No Other Duties, Etc.

54

Section 9.9.

Guaranty Matters

54

Section 9.10.

Indemnification

55

Section 9.11.

Sharing of Set-Offs and Other Payments

55

Section 9.12.

Investments

56

 

 

 

ARTICLE X. – Miscellaneous

56

Section 10.1.

Waivers and Amendments; Acknowledgments.

56

Section 10.2.

Survival of Representations, Warranties and Agreements; Cumulative Nature

58

Section 10.3.

Notices; Effectiveness; Electronic Communication.

59

Section 10.4.

Expenses; Indemnity; Damage Waiver.

60

Section 10.5.

Successors and Assigns.

62

Section 10.6.

Treatment of Certain Information; Confidentiality

65

Section 10.7.

Governing Law; Submission to Process

66

Section 10.8.

Intentionally deleted

67

Section 10.9.

Intentionally deleted

67

Section 10.10.

Limitation on Interest

67

Section 10.11.

Right of Offset

68

Section 10.12.

Termination; Limited Survival; Payments Set Aside

68

Section 10.13.

Severability

68

Section 10.14.

Counterparts

69

Section 10.15.

Waiver of Jury Trial.

69

Section 10.16.

USA PATRIOT Act Notice

69

 

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Schedules and Exhibits:

 

Schedule I – Facility Fees and Applicable Margin

Schedule II – Commitments and Pro Rata Shares

Schedule III – Disclosure Schedule

Schedule 10.3 - Administrative Agent’s Office; Certain Addresses for Notices

 

Exhibit A - Note

Exhibit B - Borrowing Notice

Exhibit C - Continuation/Conversion Notice

Exhibit D -  Certificate Accompanying Financial Statements

Exhibit E-1 - Opinion of In-House Counsel for Restricted Persons

Exhibit E-2 - Opinion of Fulbright & Jaworski L.L.P., Counsel for Restricted
Persons

Exhibit E-3 – Opinion of Bennett Jones, Canadian Counsel for Restricted Persons

Exhibit F - Assignment and Assumption Agreement

 

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INTERIM 364-DAY CREDIT AGREEMENT

 

THIS INTERIM 364-DAY CREDIT AGREEMENT is made as of July 31, 2006, by and among
PLAINS ALL AMERICAN PIPELINE, L.P., a Delaware limited partnership (“Borrower”),
JPMORGAN CHASE BANK, N.A., as administrative agent (in such capacity,
“Administrative Agent”), BANK OF AMERICA, N.A. and CITIBANK, N.A., as
co-syndication agents (in such capacity, “Co-Syndication Agents”), WACHOVIA
BANK, NATIONAL ASSOCIATION and UBS SECURITIES LLC, as co-documentation agents
(in such capacity, “Co-Documentation Agents”), JPMORGAN CHASE SECURITIES LLC and
CITIGROUP GLOBAL MARKETS INC., as joint bookrunners and co-lead arrangers, and
the Lenders referred to below. In consideration of the mutual covenants and
agreements contained herein the parties hereto agree as follows:

 

WITNESSETH

 

In consideration of the mutual covenants and agreements contained herein and in
consideration of the loans which may hereafter be made by Lenders and for other
good and valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, the parties hereto agree as follows:

 

ARTICLE I. - DEFINITIONS AND REFERENCES

 

Section 1.1.            Defined Terms. As used in this Agreement, each of the
following terms has the meaning given to such term  in this Section 1.1 or in
the sections and subsections referred to below:

 

“Acquisition Period” means the period beginning, at the election of Borrower,
with the funding date of the purchase price for a Specified Acquisition and
ending on the earliest of (a) the third following Fiscal Quarter end, (b)
Borrower’s receipt of proceeds of a Specified Equity Offering; and (c)
Borrower’s election in writing to terminate such Acquisition Period (provided,
at the time of such election, the Debt Coverage Ratio shall not, on a pro forma
basis, exceed 4.75 to 1.00); provided, however, if the Debt Coverage Ratio
exceeds 4.75 to 1.00 at the end of the Fiscal Quarter ending next following such
funding date, then the Acquisition Period shall be deemed to have commenced as
of such funding date; provided, further, during any Acquisition Period, no
additional Acquisition Period shall commence, nor shall such Acquisition Period
be extended, by any subsequent Specified Acquisition until the current
Acquisition Period shall have expired and Borrower shall be in compliance with
Section 7.8(ii).

 

“Additional Loan” shall have the meaning given such term in Section 2.1.

 

“Administrative Agent” means JPMorgan Chase Bank, N.A., as Administrative Agent
hereunder, and its successors in such capacity.

 

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

 

“Affiliate” means, as to any Person, each other Person that directly or
indirectly (through one or more intermediaries or otherwise) controls, is
controlled by, or is under common control

 

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with, such Person. A Person shall be deemed to be “controlled by” any other
Person if such other Person possesses, directly or indirectly, power to direct
or cause the direction of the management and policies of such Person whether by
contract or otherwise.

 

“Agreement” means this Credit Agreement.

 

“Applicable Lending Office” means, for each Lender and for each Type of Loan,
the “Lending Office” of such Lender (or of an Affiliate of such Lender)
designated for such Type of Loan on such Lender’s Administrative Questionnaire
or such other office of such Lender (or an Affiliate of such Lender) as such
Lender may from time to time specify to Administrative Agent, and Borrower by
written notice in accordance with the terms hereof as the office by which its
Loans of such Type are to be made and maintained.

 

“Applicable Margin” means, as to any Type of Loan,  the percent per annum set
forth on Schedule I as the “Applicable Margin” for such Type of Loan, based on
the Applicable Rating Level in effect on such date. Changes in the Applicable
Margin will occur automatically without prior notice as changes in the
Applicable Rating Level occur. Administrative Agent will give notice promptly to
Borrower and Lenders of changes in the Applicable Margin.

 

“Applicable Rating Level” means for any day, the level set forth below that
corresponds to the PAA Debt Rating by the Ratings Agencies applicable on such
day; provided, in the event the PAA Debt Rating by the Ratings Agencies differs
by one level, the higher PAA Debt Rating shall apply; provided further, in the
event the PAA Debt Rating by the Ratings Agencies differs by more than one
level, the PAA Debt Rating one level above the lower PAA Debt Rating shall
apply. As used in this definition, “≥” means a rating equal to or more favorable
than and “<“ means a rating less favorable than.

 

Rating Level

 

S&P

 

Moody’s

Level I

 

> A-

 

> A3

Level II

 

BBB+

 

Baa1

Level III

 

BBB

 

Baa2

Level IV

 

BBB-

 

Baa3

Level V

 

< BBB-

 

< Baa3

 

If either of the Rating Agencies shall not have in effect a PAA Debt Rating or
if the rating system of either of the Rating Agencies shall change, or if either
of the Rating Agencies shall cease to be in the business of rating corporate
debt obligations, Borrower and Majority Lenders shall negotiate in good faith to
amend this definition to reflect such changed rating system or the
unavailability of ratings from such Rating Agency, but until such an agreement
shall be reached, the Applicable Rating Level shall be based only upon the PAA
Debt Rating by the remaining Rating Agency.

 

“Approved Fund” means any Fund that is solely administered or managed by (a) a
Lender, (b) an Affiliate of a Lender, or (c) an entity or an Affiliate of an
entity that administers or manages a Lender.

 

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“Assignment and Assumption” means an assignment and assumption entered into by a
Lender and an Eligible Assignee, and accepted by Administrative Agent, in
substantially the form of Exhibit F.

 

“Bankruptcy and Insolvency Act (Canada)” means the Bankruptcy and Insolvency
Act, S.C. 1992, c. 27, including the regulations made and, from time to time, in
force under that Act.

 

“Base Rate” means for any day a fluctuating rate per annum equal to the higher
of (a) the Federal Funds Rate plus 1/2 of 1% and (b) the rate of interest in
effect for such day as publicly announced from time to time by the Reference
Bank as its “prime rate.”  The “prime rate” is a rate set by the Reference Bank
based upon various factors including its costs and desired return, general
economic conditions and other factors, and is used as a reference point for
pricing some loans, which may be priced at, above, or below such announced rate.
Any change in such rate announced by the Reference Bank shall take effect at the
opening of business on the day specified in the public announcement of such
change.

 

“Base Rate Loan” means a Loan which does not bear interest at a rate based upon
the Eurodollar Rate.

 

“Board” shall have the meaning given that term in clause (i) of the definition
of the term “Change of Control.”

 

“Borrower” means Plains All American Pipeline, L.P., a Delaware limited
partnership, and its successors and assigns, so long as it is permitted to
borrow hereunder.

 

“Borrowing” means (i) a borrowing of new Loans of a single Type pursuant to
Section 2.2 or (ii) a Continuation or Conversion of existing Loans into a single
Type (and, in the case of Eurodollar Loans, with the same Interest Period)
pursuant to Section 2.3.

 

“Borrowing Notice” means a written or telephonic request, or a written
confirmation, made by Borrower which meets the requirements of Section 2.2.

 

“Business Day” means any day, other than a Saturday, Sunday or day which shall
be in New York, New York a legal holiday or day on which banking institutions
are required or authorized to close. Any Business Day in any way relating to
Eurodollar Loans (such as the day on which an Interest Period begins or ends)
must also be a day on which commercial banks settle payments in London.

 

“Capital Lease” means a lease with respect to which the lessee is required
concurrently to recognize the acquisition of an asset and the incurrence of a
liability in accordance with GAAP.

 

“Capital Lease Obligation” means, with respect to any Person and a Capital
Lease, the amount of the obligation of such Person as the lessee under such
Capital Lease which would, in accordance with GAAP, appear as a liability on a
balance sheet of such Person.

 

“Cash and Carry Purchases” means purchases of Petroleum Products for physical
storage or in storage or in transit in pipelines which has been hedged by either
a NYMEX contract, an OTC contract, an Intercontinental Exchange contract, or a
contract for physical delivery.

 

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“Cash Equivalents” means Investments in:

 

(a)           marketable obligations, maturing within 12 months after
acquisition thereof, issued or unconditionally guaranteed by the United States
of America or the federal government of Canada or an instrumentality or agency
thereof and entitled to the full faith and credit of the United States of
America or the federal government of Canada, as the case may be;

 

(b)           demand deposits and time deposits (including certificates of
deposit) maturing within 12 months from the date of deposit thereof, (i) with
any office of any Lender or (ii) with a domestic office of any national, state
or provincial bank or trust company which is organized under the Laws of the
United States of America or any state therein, or the federal government of
Canada or any province therein, which has capital, surplus and undivided profits
of at least $500,000,000, and whose long term certificates of deposit are rated
at least Aa3 by Moody’s or AA- by S&P;

 

(c)           repurchase obligations with a term of not more than seven days for
underlying securities of the types described in subsection (a) above entered
into with (i) any Lender or (ii) any other commercial bank meeting the
specifications of subsection (b) above;

 

(d)           open market commercial paper, maturing within 270 days after
acquisition thereof, which are rated at least P-1 by Moody’s or A-1 by S&P; and

 

(e)           money market or other mutual funds substantially all of whose
assets comprise securities of the types described in subsections (a) through (d)
above.

 

“Change of Control” means the occurrence of any of the following events:

 

(i)            Qualifying Directors cease for any reason to constitute
collectively a majority of the members of the board of directors of GP LLC (the
“Board”) then in office;

 

(ii)           GP LLC shall cease to be, directly or indirectly, the beneficial
owner (within the meaning of Rule 13d-3 under the Securities Exchange Act of
1934, as amended) of all of the general partner interests of General Partner.

 

(iii)          General Partner shall cease to be, directly or indirectly, the
beneficial owner (as defined above) of all of the general partner interests of
Borrower; or

 

(iv)          Neither General Partner nor Borrower shall continue to be,
directly or indirectly, the beneficial owner of all of the general partner
interests in Plains Marketing and Plains Pipeline.

 

As used herein, “Qualifying Director” means (i) any Person designated by any
Qualifying Owner as its representative on the Board, (ii) so long as Qualifying
Owners own a majority of the ownership interests of GP LLC entitling the holders
thereof to vote in elections for directors of GP LLC, any Person elected by a
majority of such owners of GP LLC entitled to vote thereon, and (iii) the chief
executive officer of GP LLC, and “Qualifying Owner” means Kayne Anderson
Investment Management, EnCap Investments LLC, Vulcan Energy Corporation or any
Affiliate of any of the foregoing.

 

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“Closing Date” means the first date all the conditions precedent in Section 4.1
are satisfied or waived in accordance with Section 10.1.

 

“Code” means the Internal Revenue Code of 1986, as amended from time to time,
together with all rules and regulations promulgated with respect thereto.

 

“Commitment” means, as to each Lender, its obligation to make Loans to Borrower
pursuant to Section 2.1 in an aggregate principal amount at any one time
outstanding not to exceed the amount set forth opposite such Lender’s name on
Schedule II, or in the Assignment and Assumption pursuant to which such Lender
becomes a party hereto, as applicable. The Commitments may be reduced from time
to time pursuant to Section 2.5(b) and shall be reduced from time to time as
provided in Section 2.9(a) and (b).

 

“Commitment Period” means the period from and including the Closing Date through
and until the Conversion Date (or, if earlier, the day on which the obligation
of Lenders to make Loans to Borrower hereunder pursuant to Section 2.1 has been
terminated or the day on which any of the Notes first becomes due and payable in
full).

 

“Companies’ Creditors Arrangement Act (Canada)” means the Companies’ Creditors
Arrangement Act, R.S.C. 1985, c. C-36, including the regulations made and from
time to time in force under that Act.

 

“Consolidated” refers to the consolidation of any Person, in accordance with
GAAP, with its properly consolidated subsidiaries. References herein to a
Person’s Consolidated financial statements, financial position, financial
condition, liabilities, etc. refer to the consolidated financial statements,
financial position, financial condition, liabilities, etc. of such Person and
its properly consolidated subsidiaries.

 

“Consolidated EBITDA” means, for any period, the sum of (1) the Consolidated Net
Income during such period, plus (2) all interest expense that was deducted in
determining such Consolidated Net Income for such period, plus (3) all income
taxes (including any franchise taxes to the extent based upon net income) that
were deducted in determining such Consolidated Net Income, plus (4) all
depreciation, amortization (including amortization of good will and debt issue
costs) and other non-cash charges (including any provision for the reduction in
the carrying value of assets recorded in accordance with GAAP) which were
deducted in determining such Consolidated Net Income, minus (5) all non-cash
items of income which were included in determining such Consolidated Net Income.

 

“Consolidated Funded Indebtedness” means as of any date, the sum of the
following (without duplication):  (i) the outstanding principal amount of all
Indebtedness which is classified as “long-term indebtedness” on a consolidated
balance sheet of Borrower and its Consolidated Subsidiaries (excluding
Unrestricted Subsidiaries) prepared as of such date in accordance with GAAP
(subject to year-end audit adjustments with respect to non-year end periods) and
any current maturities and other principal amount in respect of such
Indebtedness due within one year but which was classified as “long-term
indebtedness” at the creation thereof; (ii) the outstanding principal amount of
Indebtedness for borrowed money of Borrower and its Consolidated Subsidiaries
(excluding Unrestricted Subsidiaries) outstanding under a revolving

 

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credit, term or similar agreement (and renewals and extensions thereof); and
(iii) the outstanding principal amount of Indebtedness in respect of Capital
Leases of Borrower and its Consolidated Subsidiaries (excluding Unrestricted
Subsidiaries); provided, however, Consolidated Funded Indebtedness shall not, if
otherwise applicable, include (x) Indebtedness in respect of letters of credit,
(y) Indebtedness incurred to finance Cash and Carry Purchases or (z) margin
deposits.

 

“Consolidated Net Income” means, for any period, Borrower’s and its
Subsidiaries’ (excluding Unrestricted Subsidiaries) gross revenues for such
period, including any cash dividends or distributions actually received from any
other Person during such period, minus Borrower’s and its Subsidiaries’
(excluding Unrestricted Subsidiaries) expenses and other proper charges against
income (including taxes on income, to the extent imposed), determined on a
Consolidated basis after eliminating earnings or losses attributable to
outstanding minority interests and excluding the net earnings of any Person
other than a Subsidiary in which Borrower or any of its Subsidiaries (excluding
Unrestricted Subsidiaries) has an ownership interest. Consolidated Net Income
shall not include (i) any gain or loss from the sale of assets, (ii) any
extraordinary gains or losses, or (iii) any non-cash gains or losses resulting
from mark to market activity as a result of the implementation of SFAS 133 or
EITF 98-10. In addition, Consolidated Net Income shall not include the cost or
proceeds of purchasing or selling options which are used to hedge future
activity, until the period in which such hedged future activity occurs.

 

“Consolidated Tangible Net Worth” means the remainder of (i) all Consolidated
assets, as determined in accordance with GAAP, of Borrower and its Subsidiaries
(excluding Unrestricted Subsidiaries) minus (ii) the sum of (a) Borrower’s
Consolidated liabilities (excluding liabilities of Unrestricted Subsidiaries, to
the extent included therein), as determined in accordance with GAAP, (b) the
book value of any equity interests in any of Borrower’s Subsidiaries (excluding
Unrestricted Subsidiaries) which equity interests are owned by a Person other
than Borrower or a Wholly Owned Subsidiary of Borrower; and (c) the net book
value of all assets that would be treated as intangible under GAAP, including
goodwill, trademarks, trade names and service marks, excluding fifty percent
(50%) of goodwill attributed to the PPX Acquisition. The effect of any increase
or decrease of net worth in any period as a result of items of income or loss
not reflected in the determination of net income but reflected in the
determination of comprehensive income (to the extent provided under GAAP as in
effect on the date hereof) shall be excluded in determining Consolidated
Tangible Net Worth.

 

“Contango Credit Agreement” means that certain Restated Credit Agreement dated
November 19, 2004, as amended by First Amendment to Restated Credit Agreement
dated April 20, 2005, Second Amendment to Restated Credit Agreement dated May
20, 2005, Third Amendment to Restated Credit Agreement dated November 4, 2005,
and as further amended from time to time, among Plains Marketing, Bank of
America, N.A., as administrative agent, and the lenders named therein.

 

“Continue”, “Continuation” and “Continued” shall refer to the continuation
pursuant to Section 2.3 of a Eurodollar Loan as a Eurodollar Loan from one
Interest Period to the next Interest Period.

 

“Continuation/Conversion Notice” means a written or telephonic request, or a
written confirmation, made by Borrower which meets the requirements of Section
2.3.

 

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“Convert”, “Conversion” and “Convert” refers to a conversion pursuant to
Section 2.3 of one Type of Loan into another Type of Loan.

 

“Conversion Date” means the earlier of (i) the date 364 days after the Initial
Funding Date and (ii) July 31, 2008.

 

“Debt Coverage Ratio” shall have the meaning given that term in Section 7.8.

 

“Default” means any Event of Default and any default, event or condition which
would, with the giving of any requisite notices and the passage of any requisite
periods of time, constitute an Event of Default.

 

“Defaulting Lender” means any Lender Party that (a) has failed to fund any
portion of the Loans required to be funded by it hereunder within one Business
Day of the date required for such funding, unless cured, (b) has otherwise
failed to pay over to Administrative Agent or any other Lender any other amount
required to be paid by it hereunder within one Business Day of the date when
due, unless cured or the subject of a good faith dispute, (c) has otherwise
materially breached any of its obligations hereunder or under any other Loan
Document, unless cured, or (d) has been deemed insolvent or become the subject
of a bankruptcy or insolvency proceeding.

 

“Default Rate” means, at the time in question, two percent (2%) per annum plus:

 

(a)           the Eurodollar Rate plus the Applicable Margin then in effect for
each Eurodollar Loan (up to the end of the applicable Interest Period), or

 

(b)           the Base Rate plus the Applicable Margin then in effect for each
Base Rate Loan;

 

provided, however, the Default Rate shall never exceed the Highest Lawful Rate.

 

“Default Rate Period” means (i) any period during which an Event of Default,
other than pursuant to Section 8.1(a) or (b), is continuing, provided that such
period shall not begin until notice of the commencement of the Default Rate has
been given to Borrower by Administrative Agent upon the instruction by Majority
Lenders and (ii) any period during which any Event of Default pursuant to
Section 8.1(a) or (b) is continuing unless Borrower has been notified otherwise
by Administrative Agent upon the instruction by Majority Lenders.

 

“Disclosure Schedule” means Schedule III hereto.

 

“Distribution” means (a) any dividend or other distribution (whether in cash or
other property, but excluding dividends or other distributions payable in equity
interests in Borrower) with respect to any equity interest of Borrower, (b) any
payment (whether in cash or other property, but excluding dividends or other
distributions payable in equity interests in Borrower), including any sinking
fund or similar deposit, on account of the retirement, redemption, purchase,
cancellation, termination or other acquisition for value of any equity interest
of Borrower or (c) any other payment by Borrower to any holder of equity
interests of Borrower

 

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with respect to such equity interests held thereby other than payments made with
equity interests in Borrower.

 

“Dollar Equivalent” of any amount of any currency at any date means (i) if such
currency is Dollars, the amount of such currency, or (ii) if such currency is
Canadian Dollars, the equivalent in Dollars of such amount of such currency
based upon the rate of exchange for such conversion as quoted by the Bank of
Canada at approximately 12:00 noon, Toronto time (or, if not so quoted, the spot
rate of exchange quoted for wholesale transactions made by Administrative Agent)
on the date on or as of which such amount is to be determined.

 

“Dollars” and “$” means the lawful currency of the United States of America,
except where otherwise specified.

 

“Eligible Assignee” means (a) a Lender, and (b) any other Person (other than a
natural person), including Affiliates of Lenders and Approved Funds, approved by
(i) Administrative Agent, and (ii) unless an Event of Default is continuing,
Borrower (each such approval not to be unreasonably withheld or delayed);
provided, that notwithstanding the foregoing, “Eligible Assignee” shall not
include Borrower or any of Borrower’s Affiliates or Subsidiaries or, unless an
Event of Default is continuing, any Person who, at the relevant time of
determination, is a Defaulting Lender or an Affiliate of a Defaulting Lender;
provided further, an Eligible Assignee of any Lender shall include only those
Persons which, through their respective Lending Offices, are capable of lending
Dollars to Borrower without the imposition of any withholding taxes on interest
or principal owed to such Persons, and Loans by such Eligible Assignee shall be
made through such Lending Office.

 

“Environmental Laws” means any and all Laws relating to the environment or to
emissions, discharges, releases or threatened releases of pollutants,
contaminants, chemicals, or industrial, toxic or hazardous substances or wastes
into the environment including ambient air, surface water, ground water, or
land, or otherwise relating to the manufacture, processing, distribution, use,
treatment, storage, disposal, transport, or handling of pollutants,
contaminants, chemicals, or industrial, toxic or hazardous substances or wastes.

 

“ERISA” means the Employee Retirement Income Security Act of 1974, as amended
from time to time, together with all rules and regulations promulgated with
respect thereto.

 

“ERISA Affiliate” means each Restricted Person and all members of a controlled
group of corporations and all trades or businesses (whether or not incorporated)
under common control that, together with such Restricted Person, are treated as
a single employer under Section 414 of the Code.

 

“ERISA Plan” means any employee pension benefit plan subject to Title IV of
ERISA maintained by any ERISA Affiliate with respect to which any Restricted
Person has a fixed or contingent liability.

 

“Eurodollar Loan” means a Loan that bears interest at a rate based upon the
Eurodollar Rate.

 

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“Eurodollar Rate” means, for any Interest Period with respect to a Eurodollar
Loan, the rate per annum equal to the British Bankers Association LIBOR Rate
(“BBA LIBOR”), as published by Reuters (or other commercially available source
providing quotations of BBA LIBOR as designated by Administrative Agent from
time to time) at approximately 11:00 a.m., London time, two Business Days prior
to the commencement of such Interest Period, for Dollar deposits (for delivery
on the first day of such Interest Period) with a term equivalent to such
Interest Period. If such rate is not available at such time for any reason, then
the “Eurodollar Rate” for such Interest Period shall be the rate per annum
determined by Administrative Agent to be the rate at which deposits in Dollars
for delivery on the first day of such Interest Period in same day funds in the
approximate amount of the Eurodollar Loan being made, continued or converted by
the Reference Bank and with a term equivalent to such Interest Period would be
offered by the Reference Bank’s London Branch to major banks in the London
interbank eurodollar market at their request at approximately 11:00 a.m. (London
time) two Business Days prior to the commencement of such Interest Period.

 

“Event of Default” has the meaning given to such term in Section 8.1.

 

“Facility Fee Rate” means, on any day, the rate per annum set forth on Schedule
I as the “Facility Fee Rate” based on the Applicable Rating Level on such date;
provided, on and after the Conversion Date, the Facility Fee Rate shall be
increased by 0.25% per annum. Changes in the applicable Facility Fee Rate will
occur automatically without prior notice as changes in the Applicable Rating
Level occur. Administrative Agent will give notice promptly to Borrower and
Lenders of changes in the Facility Fee Rate.

 

“Federal Funds Rate” means, for any day, the rate per annum equal to the
weighted average of the rates on overnight Federal funds transactions with
members of the Federal Reserve System arranged by Federal funds brokers on such
day, as published by the Federal Reserve Bank of New York on the Business Day
next succeeding such day; provided that (a) if such day is not a Business Day,
the Federal Funds Rate for such day shall be such rate on such transactions on
the next preceding Business Day as so published on the next succeeding Business
Day, and (b) if no such rate is so published on such next succeeding Business
Day, the Federal Funds Rate for such day shall be the average rate (rounded
upward, if necessary, to a whole multiple of 1/100 of 1%) charged to JPMorgan
Chase Bank on such day on such transactions as determined by Administrative
Agent.

 

“Fiscal Quarter” means a three-month period ending on March 31, June 30,
September 30 or December 31 of any year.

 

“Fiscal Year” means a twelve-month period ending on December 31 of any year.

 

“Fund” means any Person (other than a natural person) that is engaged in making,
purchasing or holding commercial loans and similar extensions of credit in the
ordinary course of its business.

 

“GAAP” means those generally accepted accounting principles and practices which
are recognized as such by the Financial Accounting Standards Board (or any
generally recognized successor) and which, in the case of Borrower and its
Consolidated Subsidiaries, are applied for

 

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all periods after the date hereof in a manner consistent with the manner in
which such principles and practices were applied to the Initial Financial
Statements. If any change in any accounting principle or practice is required by
the Financial Accounting Standards Board (or any such successor) in order for
such principle or practice to continue as a generally accepted accounting
principle or practice, all reports and financial statements required hereunder
with respect to Borrower or with respect to Borrower and its Consolidated
Subsidiaries may be prepared in accordance with such change, but all
calculations and determinations to be made hereunder may be made in accordance
with such change only after notice of such change is given to each Lender and
Majority Lenders agree to such change insofar as it affects the accounting of
Borrower or of Borrower and its Consolidated Subsidiaries.

 

“General Partner” means Plains AAP, L.P., a Delaware limited partnership, in its
capacity as the sole general partner of Borrower.

 

“Governmental Authority” means the government of the United States or any other
nation, or of any political subdivision thereof, whether state or local, and any
agency, authority, instrumentality, regulatory body, court, central bank or
other entity thereof authorized by applicable Law to exercise executive,
legislative, judicial, taxing, regulatory or administrative powers or functions
of or pertaining to such government (including any supra-national bodies such as
the European Union or the European Central Bank).

 

“GP LLC” means Plains All American GP LLC, a Delaware limited liability company.

 

“Guarantors” means, as of the date hereof, any of Borrower’s Subsidiaries that
now or hereafter executes and delivers a guaranty of the Obligations to
Administrative Agent pursuant to Section 6.9.

 

“Hazardous Materials” means any substances regulated under any Environmental
Law, whether as pollutants, contaminants, or chemicals, or as industrial, toxic
or hazardous substances or wastes, or otherwise.

 

“Highest Lawful Rate” means, with respect to each Lender Party to whom
Obligations are owed, the maximum nonusurious rate of interest that such Lender
Party is permitted under applicable Law to contract for, take, charge, or
receive with respect to such Obligations. All determinations herein of the
Highest Lawful Rate, or of any interest rate determined by reference to the
Highest Lawful Rate, shall be made separately for each Lender Party as
appropriate to assure that the Loan Documents are not construed to obligate any
Person to pay interest to any Lender Party at a rate in excess of the Highest
Lawful Rate applicable to such Lender Party.

 

“Indebtedness” of any Person means each of the following:

 

(a)           its obligations for the repayment of borrowed money,

 

(b)           its obligations to pay the deferred purchase price of property or
services (excluding trade account payables arising in the ordinary course of
business), other than contingent purchase price or similar obligations incurred
in connection with an acquisition and not yet earned or determinable,

 

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(c)           its obligations evidenced by a bond, debenture, note or similar
instrument,

 

(d)           its obligations, as lessee, constituting principal under Capital
Leases,

 

(e)           its direct or contingent reimbursement obligations with respect to
the face amount of letters of credit pursuant to the applications or
reimbursement agreements therefor,

 

(f)            its obligations for the repayment of outstanding banker’s
acceptances, whether matured or unmatured,

 

(g)           its obligations under any synthetic lease, tax retention operating
lease, off-balance sheet loan or similar off-balance sheet financing if the
obligation under such synthetic lease, tax retention operating lease,
off-balance sheet loan or similar off-balance sheet financing is considered
indebtedness for borrowed money for tax purposes but is classified as an
operating lease in accordance with GAAP (excluding, to the extent included
herein, operating leases entered into in the ordinary course of business), or

 

(h)           its obligations under guaranties of any obligations of any other
Person described in the foregoing clauses (a) through (g).

 

“Initial Financial Statements” means (i) the audited Consolidated financial
statements of Borrower as of December 31, 2005, and (ii) the unaudited
consolidating balance sheet and income statement of Borrower as of March 31,
2006.

 

“Initial Funding Date” means the first date following the Closing Date that all
the conditions precedent in Section 4.2 and 4.3 are satisfied or waived in
accordance with Section 10.1 and Borrower’s initial funding request hereunder is
so funded, but in any event shall occur not later than July 31, 2008.

 

“Initial Loan” has the meaning given to such term in Section 2.1.

 

“Interest Expense” means, with respect to any period, the sum (without
duplication) of the following (in each case, eliminating all offsetting debits
and credits between Borrower and its Subsidiaries (excluding Unrestricted
Subsidiaries) and all other items required to be eliminated in the course of the
preparation of Consolidated financial statements of Borrower and its
Subsidiaries (excluding Unrestricted Subsidiaries) in accordance with GAAP):
(a) all interest and facility or commitment fees in respect of Indebtedness of
Borrower or any of its Subsidiaries (excluding Unrestricted Subsidiaries)
(including imputed interest on Capital Lease Obligations) which are accrued
during such period and whether expensed in such period or capitalized; plus (b)
all fees in respect of letters of credit issued for the account of Borrower or
any of its Subsidiaries, which are accrued during such period and whether
expensed in such period or capitalized.

 

“Interest Payment Date” means (a) with respect to each Base Rate Loan, the last
day of each March, June, September and December beginning September 30, 2006,
and (b) with respect to each Eurodollar Loan, the last day of the Interest
Period that is applicable thereto and, if such Interest Period is six, or twelve
months in length, the dates specified by Administrative Agent, which are
approximately three, six, and nine months (as appropriate) after such Interest
Period

 

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begins; provided that the last Business Day of each calendar month shall also be
an Interest Payment Date for each such Loan so long as any Event of Default
exists under Section 8.1 (a) or (b).

 

“Interest Period” means, with respect to each particular Eurodollar Loan in a
Borrowing, the period specified in the Borrowing Notice or
Continuation/Conversion Notice applicable thereto, beginning on and including
the date specified in such Borrowing Notice or Continuation/Conversion Notice
(which must be a Business Day), and ending one, two, three, six or twelve months
(if twelve months is available for each Lender) thereafter (and, as to Loans,
ending on a date less than 30 days thereafter as may be specified by Borrower,
if such lesser period is available for each Lender making such Loans), as
Borrower may elect in such notice; provided that:  (a) any Interest Period which
would otherwise end on a day which is not a Business Day shall be extended to
the next succeeding Business Day unless such Business Day falls in another
calendar month, in which case such Interest Period shall end on the next
preceding Business Day; (b) any Interest Period (other than an Interest Period
ending on a date less than 30 days after the beginning thereof as may be
specified by Borrower and otherwise permitted hereunder) which begins on the
last Business Day in a calendar month (or on a day for which there is no
numerically corresponding day in the calendar month at the end of such Interest
Period) shall end on the last Business Day in a calendar month; and (c)
notwithstanding the foregoing, no Interest Period may be selected for a Loan to
Borrower that would end after the Maturity Date

 

“Investment” means any investment made, directly or indirectly in any Person,
whether by acquisition of shares of capital stock, indebtedness or other
obligations or securities or by loan, advance, capital contribution or
otherwise, and whether made in cash, by the transfer of property or by any other
means.

 

“Law” means any statute, law, regulation, ordinance, rule, treaty, judgment,
order, decree, permit, concession, franchise, license, agreement or other
governmental restriction of the United States or Canada or any state, province,
or political subdivision thereof or of any foreign country or any department,
state, province or other political subdivision thereof.

 

“Lender Parties” means Administrative Agent and all Lenders.

 

“Lenders” means each signatory hereto designated as a Lender, and the successors
and permitted assigns of each such party as holder of a Note.

 

“Liabilities” means, as to any Person, all indebtedness, liabilities and
obligations of such Person, whether matured or unmatured, liquidated or
unliquidated, primary or secondary, direct or indirect, absolute, fixed or
contingent, and whether or not required to be considered pursuant to GAAP.

 

“Lien” means, with respect to any property or assets, any right or interest
therein of a creditor to secure Liabilities owed to it or any other arrangement
with such creditor which provides for the payment of such Liabilities out of
such property or assets or which allows such creditor to have such Liabilities
satisfied out of such property or assets prior to the general creditors of any
owner thereof, including any lien, mortgage, security interest, pledge, deposit,

 

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production payment, rights of a vendor under any title retention or conditional
sale agreement or lease substantially equivalent thereto, tax lien, mechanic’s
or materialman’s lien, or any other charge or encumbrance for security purposes,
whether arising by Law or agreement or otherwise, but excluding any right of
offset which arises without agreement in the ordinary course of business. “Lien”
also means any filed financing statement, any registration of a pledge (such as
with an issuer of uncertificated securities), or any other arrangement or action
which would serve to perfect a Lien described in the preceding sentence,
regardless of whether such financing statement is filed, such registration is
made, or such arrangement or action is undertaken before or after such Lien
exists.

 

“Loan Documents” means this Agreement, the Notes, the written Borrowing Notices
and all other agreements, certificates, documents, instruments and writings at
any time delivered in connection herewith or therewith (exclusive of term sheets
and commitment letters).

 

“Loans” means loans by Lenders to Borrower pursuant to Section 2.1.

 

“Majority Lenders” means Lenders who have in the aggregate more than fifty
percent (50%) of the Total Committed Amount; provided that the Commitment of,
and the portion of the Total Committed Amount held or deemed held by, any
Defaulting Lender shall be excluded for purposes of making a determination of
Majority Lenders.

 

“Material Adverse Change” means (a) a material and adverse change in (i)
Borrower’s Consolidated financial condition, (ii) Borrower’s Consolidated
operations, properties or prospects, considered as a whole, or (iii) Borrower’s
ability to timely pay its Obligations, or (b) a material adverse effect on the
enforceability of the material terms of any Loan Document.

 

“Maturity Date” means the date one year after the Conversion Date, unless
terminated earlier in accordance with Section 8.1 or Section 10.12.

 

“Moody’s” means Moody’s Investor Service, Inc., or its successor.

 

“Notes” has the meaning given such term in Section 2.1 hereof.

 

“Obligations” means all Liabilities from time to time owing by any Restricted
Person to any Lender Party under or pursuant to any of the Loan Documents.
“Obligation” means any part of the Obligations.

 

“Outstanding Amount” means on any date the aggregate outstanding principal
amount of Loans after giving effect to any borrowings and prepayments or
repayments of such Loans occurring on such date.

 

“PAA Debt Rating” means the rating then in effect by a Rating Agency with
respect to the long term senior unsecured non-credit enhanced debt of Borrower.

 

“Participant” has the meaning specified in Section 10.5(d).

 

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“Percentage Share” means:

 

(a)           at any time the Commitments remain outstanding until the Initial
Funding Date, a fraction (expressed as a percentage, carried out to the sixth
decimal place), the numerator of which is the amount of the Commitment of such
Lender at such time and the denominator of which is the amount of the Total
Committed Amount at such time;

 

(b)           on and after the Initial Funding Date until the earliest of (i)
the date on which the Additional Loans are made, (ii) the Conversion Date, and
(iii) the termination of the Commitments pursuant to Section 8.1, a fraction
(expressed as a percentage, carried out to the sixth decimal place), the
numerator of which is the sum of the Outstanding Amount of the Initial Loan of
such Lender plus such Lender’s then-outstanding Commitment, and the denominator
of which is the sum of the Outstanding Amount of all Initial Loans plus the
then-outstanding Total Committed Amount; and

 

(c)           on and after the earliest of (i) the date on which the Additional
Loans are made, (ii) the Conversion Date, and (iii) the termination of the
Commitments pursuant to Section 8.1, a fraction (expressed as a percentage,
carried out to the sixth decimal place), the numerator of which is the
Outstanding Amount of Loans of such Lender and the denominator of which is the
Total Outstanding Amount.

 

The initial Percentage Share of each Lender is set forth opposite the name of
such Lender on Schedule II or in the Assignment and Assumption pursuant to which
such Lender becomes a party hereto, as applicable.

 

“Permitted Lien” has the meaning given to such term in Section 7.2.

 

“Person” means an individual, corporation, partnership, limited liability
company, association, joint stock company, trust or trustee thereof, estate or
executor thereof, unincorporated organization or joint venture, Governmental
Authority, or any other legally recognizable entity.

 

“Petroleum Products” means crude oil, condensate, natural gas, natural gas
liquids (NGL’s), liquefied petroleum gases (LPG’s), refined petroleum products
or any blend thereof.

 

“Plains Marketing” means Plains Marketing, L.P., a Texas limited partnership.

 

“Plains Pipeline” means Plains Pipeline, L.P., a Texas limited partnership.

 

“PPX” means Pacific Energy Partners, L.P., a Delaware limited partnership.

 

“PPX Acquisition” means (i) the merger of PPX with and into Borrower, (ii) the
purchase by Borrower from LB Pacific, LP, a Delaware limited partnership, of
certain equity interests in PPX and in certain Affiliates of PPX, and (iii) the
acquisition of other property and interests, in each case pursuant to the PPX
Acquisition Documents.

 

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“PPX Acquisition Documents” means the PPX Merger Agreement, the PPX Purchase
Agreement, and all other agreements or instruments executed and delivered by
Borrower or any of its Affiliates in connection therewith to consummate the PPX
Acquisition.

 

“PPX Merger Agreement” means that certain Agreement and Plan of Merger dated as
of June 11, 2006 by and among PPX and certain of its Affiliates and Borrower and
certain of its Affiliates.

 

“PPX Purchase Agreement” means that certain Purchase Agreement dated as of June
11, 2006 by and among LB Pacific, LP, a Delaware limited partnership, and
Borrower.

 

“Principal Property” means, whether owned or leased on the date hereof or
hereafter acquired:

 

(a) any pipeline assets of any Restricted Person, including any related
facilities employed in the transportation, distribution, terminalling,
gathering, treating, processing, marketing or storage of crude oil or refined
petroleum products, natural gas, natural gas liquids, fuel additives or
petrochemicals; and

 

(b) any processing or manufacturing plant or terminal owned or leased by any
Restricted Person;

 

except, in the case of either clause (a) or (b): (i) any such assets consisting
of inventories, furniture, office fixtures and equipment, including data
processing equipment, vehicles and equipment used on, or useful with, vehicles,
and (ii) any such asset, plant or terminal which, in the good faith opinion of
the Board, is not material in relation to the activities of Borrower and its
Subsidiaries, taken as a whole.

 

“Rating Agency” means either S&P or Moody’s.

 

“Reference Bank” means, at any time, the financial institution serving as
Administrative Agent.

 

“Regulation D” means Regulation D of the Board of Governors of the Federal
Reserve System as from time to time in effect.

 

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

 

“Responsible Officer” means the chief executive officer, president, chief
financial officer, treasurer or assistant treasurer of Borrower, General
Partner, or the general partner of General Partner, as the case may be. Any
document delivered hereunder that is signed by a Responsible Officer of Borrower
shall be conclusively presumed to have been authorized by all necessary
corporate, partnership and/or other action on the part of Borrower, and such
Responsible Officer shall be conclusively presumed to have acted on behalf of
Borrower.

 

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“Restricted Person” means any of Borrower and each Subsidiary of Borrower,
including but not limited to Plains Marketing, Plains Pipeline, PMC (Nova
Scotia) Company, Plains Marketing Canada, L.P., and each Subsidiary of Plains
Marketing, Plains Pipeline, PMC (Nova Scotia) Company and Plains Marketing
Canada, L.P., but excluding, for the avoidance of doubt, Unrestricted
Subsidiaries.

 

“Restriction Exception” means (i) any applicable Law or any instrument governing
Indebtedness or equity interests, or any applicable Law or any other agreement
relating to any property, assets or operations of a Person whose capital stock
or other equity interests are acquired, in whole or part, by a Restricted Person
pursuant to an acquisition (whether by merger, consolidation, amalgamation or
otherwise), as such instrument or agreement is in effect at the time of such
acquisition (except with respect to Indebtedness incurred in connection with, or
in contemplation of, such acquisition), or such applicable Law is then or
thereafter in effect (as applicable), which is not applicable to the acquiring
Restricted Person, or the property, assets or operations of the acquiring
Restricted Person, other than the acquired Person, or the property, assets or
operations of such acquired Person or such acquired Person’s Subsidiaries;
provided that in the case of Indebtedness, the incurrence of such Indebtedness
is not prohibited hereunder, (ii) provisions with respect to the disposition or
distribution of assets in joint venture agreements or other similar agreements
entered into in the ordinary course of business, (iii) (a) a lease, license or
similar contract, which restricts in a customary manner the subletting,
assignment, encumbrance or transfer of any property or asset that is subject
thereto or the assignment, encumbrance or transfer of any such lease, license or
other contract, (b) mortgages, deeds of trust, pledges or other security
instruments, the entry into which does not result in a Default, securing
indebtedness of a Restricted Person, which restricts the transfer of the
property subject to such mortgages, deeds of trust, pledges or other security
instruments, or (c) customary provisions restricting disposition of, or
encumbrances on, real property interests set forth in any reciprocal easements
of any Restricted Person, (iv) restrictions imposed pursuant to this Agreement
and the other Loan Documents, (v) restrictions on the transfer or encumbrance of
property or assets which are imposed by the holder of Liens on property or
assets of a Restricted Person, provided that neither the incurrence of such Lien
nor any related Indebtedness results in a Default, (vi) any agreement to,
directly or indirectly, sell or otherwise dispose of assets or equity interests
to any Person pending the closing of such sale, provided that such sale is
consummated in compliance with any applicable provisions of this Agreement,
(vii) net worth provisions in leases and other agreements entered into by any
Restricted Person in the ordinary course of business, and (viii) an agreement
governing Indebtedness incurred to refinance the Indebtedness issued, assumed or
incurred pursuant to an agreement referred to in clauses (iv) and (v) above;
provided, however, that the provisions relating to such encumbrance or
restriction contained in any such Indebtedness are no less favorable to the such
Restricted Person in any material respect as determined by the Board in its
reasonable and good faith judgment than the provisions relating to such
encumbrance or restriction contained in agreements referred to in such clauses
(iv) and (v).

 

“S&P” means Standard & Poor’s Ratings Group (a division of McGraw Hill, Inc.) or
its successor.

 

“Significant Restricted Persons” means Borrower, Plains Marketing, Plains
Pipeline, PMC (Nova Scotia) Company, Plains Marketing Canada, L.P., and
Subsidiaries of Borrower that

 

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would be a “significant subsidiary” as defined in Article 1, Rule 1-02 of
Regulation S-X, promulgated pursuant to the Securities Exchange Act of 1934 and
the Securities Act of 1933, each as amended.

 

“Specified Acquisition” means one or more acquisitions of assets or entities or
operating lines or divisions in any rolling 12-month period for an aggregate
purchase price of not less than $50,000,000.

 

“Specified Equity Offering” means one or more issuances of equity by Borrower
for aggregate net cash proceeds of not less than fifty percent (50%) of the
aggregate purchase price of the Specified Acquisition.

 

“Subsidiary” means, with respect to any Person, any corporation, association,
partnership, limited liability company, joint venture, or other business or
corporate entity, enterprise or organization which is directly or indirectly
(through one or more intermediaries) controlled or owned more than fifty percent
by such Person (other than PAA/Vulcan Gas Storage, LLC and its subsidiaries,
unless Borrower shall also have the fully matured right, directly or indirectly,
to elect more than 50% of the board of directors of PAA/Vulcan Gas Storage,
LLC); provided, however, that no Unrestricted Subsidiary shall be deemed a
“Subsidiary” of any Restricted Person for purposes of any Loan Document except
as provided in Section 7.10.

 

“Termination Event” means (a) the occurrence with respect to any ERISA Plan of
(i) a reportable event described in Sections 4043(c)(5) or (6) of ERISA or (ii)
any other reportable event described in Section 4043(c) of ERISA other than a
reportable event not subject to the provision for 30-day notice to the Pension
Benefit Guaranty Corporation pursuant to a waiver by such corporation under
Section 4043(a) of ERISA, or (b) the withdrawal of any ERISA Affiliate from an
ERISA Plan during a plan year in which it was a “substantial employer” as
defined in Section 4001(a)(2) of ERISA, or (c) the filing of a notice of intent
to terminate any ERISA Plan or the treatment of any ERISA Plan amendment as a
termination under Section 4041 of ERISA, or (d) the institution of proceedings
to terminate any ERISA Plan by the Pension Benefit Guaranty Corporation under
Section 4042 of ERISA, or (e) any other event or condition which might
constitute grounds under Section 4042 of ERISA for the termination of, or the
appointment of a trustee to administer, any ERISA Plan.

 

“Ticking Fee Rate” means, on any day, the rate per annum set forth on Schedule I
as the “Ticking Fee Rate” based on the Applicable Rating Level on such date.
Changes in the applicable Ticking Fee Rate will occur automatically without
prior notice as changes in the Applicable Rating Level occur. Administrative
Agent will give notice promptly to Borrower and Lenders of changes in the
Ticking Fee Rate.

 

“Total Committed Amount” means, at any time, the sum of the aggregate amount of
the Commitments at such time.

 

“Total Outstanding Amount” means, at any time, the Outstanding Amount of all
Loans at such time.

 

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“Type” means, with respect to any Loans, the characterization of such Loans as
Base Rate Loans or Eurodollar Loans.

 

“Unrestricted Subsidiary” shall have the meaning given it in Section 7.10.

 

“US/Canada Credit Agreement” means that certain Second Amended and Restated
Credit Agreement [US/Canada Facilities] of even date herewith among Borrower,
PMC (Nova Scotia) Company, Plains Marketing Canada, L.P., Bank of America, N.A.,
as administrative agent, Bank of America, N.A., acting through its Canada
Branch, as Canadian administrative agent, and the lenders named therein, as from
time to time amended.

 

“Wholly Owned Subsidiary” means any Subsidiary of a Person, all of the issued
and outstanding stock, limited liability company membership interests, or
partnership interests of which (including all rights or options to acquire such
stock or interests) are directly or indirectly (through one or more
Subsidiaries) owned by such Person.

 

Section 1.2.            Exhibits and Schedules; Additional Definitions. All
Exhibits and Schedules attached to this Agreement are a part hereof for all
purposes.

 

Section 1.3.            Amendment of Defined Instruments. Unless the context
otherwise requires or unless otherwise provided herein the terms defined in this
Agreement which refer to a particular agreement, instrument or document also
refer to and include all renewals, extensions, modifications, amendments and
restatements of such agreement, instrument or document, provided that nothing
contained in this section shall be construed to authorize any such renewal,
extension, modification, amendment or restatement.

 

Section 1.4.            References and Titles. All references in this Agreement
to Exhibits, Schedules, articles, sections, subsections and other subdivisions
refer to the Exhibits, Schedules, articles, sections, subsections and other
subdivisions of this Agreement unless expressly provided otherwise. Titles
appearing at the beginning of any subdivisions are for convenience only and do
not constitute any part of such subdivisions and shall be disregarded in
construing the language contained in such subdivisions. The words “this
Agreement,” “this instrument,” “herein,” “hereof,” “hereby,” “hereunder” and
words of similar import refer to this Agreement as a whole and not to any
particular subdivision unless expressly so limited. The phrases “this section”
and “this subsection” and similar phrases refer only to the sections or
subsections hereof in which such phrases occur. The word “or” is not exclusive,
and the word “including” (in its various forms) means “including without
limitation.”  Pronouns in masculine, feminine and neuter genders shall be
construed to include any other gender, and words in the singular form shall be
construed to include the plural and vice versa, unless the context otherwise
requires. References to an “officer” or “officers” of the General Partner or any
Restricted Person shall mean and include officers of such Person or the
controlling management entity of such Person as provided in such Person’s
organizational documents, as applicable.

 

Section 1.5.            Calculations and Determinations. All calculations under
the Loan Documents of interest chargeable with respect to Eurodollar Loans and
of fees shall be made on the basis of actual days elapsed (including the first
day but excluding the last) and a year of 360 days. All other calculations of
interest made under the Loan Documents shall be made on the

 

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basis of actual days elapsed (including the first day but excluding the last)
and a year of 365 or 366 days, as appropriate. Each determination by a Lender
Party of amounts to be paid under Article III or any other matters which are to
be determined hereunder by a Lender Party (such as any Eurodollar Rate, Business
Day or Interest Period) shall, in the absence of manifest error, be conclusive
and binding. Unless otherwise expressly provided herein or unless Majority
Lenders otherwise consent all financial statements and reports furnished to any
Lender Party hereunder shall be prepared and all financial computations and
determinations pursuant hereto shall be made in accordance with GAAP.

 

ARTICLE II. - THE LOANS

 

Section 2.1.            Commitments to Lend; Notes. Subject to the terms and
conditions hereof, each Lender agrees to make a Loan on the Initial Funding Date
to Borrower (an “Initial Loan”), and a single additional Loan on or after the
Initial Funding Date (an “Additional Loan”), in each case upon Borrower’s
request from time to time during the Commitment Period, provided that
(a) subject to Sections 3.3, 3.4 and 3.6, all Lenders are requested to make
Loans of the same Type in accordance with their respective Percentage Shares and
as part of the same Borrowing, (b) such Loans, when made, do not exceed the
Total Committed Amount determined as of the date on which the requested Loans
are to be made, (c) each such Lender’s Loan, when made, does not exceed such
Lender’s Commitment, and (d) the aggregate amount of the Additional Loans shall
not exceed $250,000,000. The aggregate amount of all Loans in any Borrowing must
be equal to $1,000,000 or any higher integral multiple of $1,000,000. The
obligation of Borrower to repay to each Lender the aggregate amount of all Loans
made by such Lender to Borrower, together with interest accruing in connection
therewith, shall be evidenced by a single promissory note (herein called such
Lender’s “Note”) made by Borrower payable to the order of such Lender in the
form of Exhibit A with appropriate insertions. The amount of principal owing on
any Lender’s Note at any given time shall be the aggregate amount of all Loans
theretofore made by such Lender to Borrower minus all payments of principal
theretofore received by such Lender on such Note. Interest on each Note shall
accrue and be due and payable as provided herein and therein. Each Note shall be
due and payable as provided herein and therein, and shall be due and payable in
full on the Maturity Date. Borrower may not reborrow, in whole or part, the
repaid portion of any Loans made under this Section 2.1. Borrower may have no
more than seven Borrowings of Eurodollar Loans outstanding at any time. All
payments of principal and interest on the Loans made pursuant to this Section
2.1 shall be made in Dollars.

 

 

Section 2.2.            Requests for Loans. Borrower must give to Administrative
Agent written notice (or telephonic notice promptly confirmed in writing) of any
requested Borrowing. Each such notice constitutes a “Borrowing Notice” hereunder
and must:

 

(a)           specify (i) the aggregate amount of such Borrowing and the date on
which Base Rate Loans are to be advanced, or (ii) the aggregate amount of any
such Borrowing of new Eurodollar Loans, the date on which such Eurodollar Loans
are to be advanced (which shall be the first day of the Interest Period which is
to apply thereto), and the length of the applicable Interest Period; and

 

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(b)           be received by Administrative Agent not later than 11:00 a.m., New
York, New York time on (i) the day on which any such Base Rate Loans are to be
made, or (ii) the third Business Day preceding the day on which any such
Eurodollar Loans are to be made.

 

Each such written request or confirmation must be made in the form and substance
of the “Borrowing Notice” attached hereto as Exhibit B, duly completed. Each
such telephonic request shall be deemed a representation, warranty,
acknowledgment and agreement by Borrower as to the matters which are required to
be set out in such written confirmation. Upon receipt of any such Borrowing
Notice, Administrative Agent shall give each Lender prompt notice of the terms
thereof. If all conditions precedent to such new Loans have been met, each
Lender will on the date requested promptly remit to Administrative Agent at its
office in New York, New York, the amount of such Lender’s new Loan in
immediately available funds, and upon receipt of such funds, unless to its
actual knowledge any conditions precedent to such Loans have been neither met
nor waived as provided herein, Administrative Agent shall promptly make such
Loans available to Borrower. Unless Administrative Agent shall have received
prompt notice from a Lender that such Lender will not make available to Borrower
such Lender’s new Loan, Administrative Agent may in its discretion assume that
such Lender has made such Loan available to Administrative Agent in accordance
with this section, and Administrative Agent may if it chooses, in reliance upon
such assumption, make such Loan available to Borrower. If and to the extent such
Lender shall not so make its new Loan available to Administrative Agent, such
Lender and Borrower severally agree to pay or repay to Administrative Agent
within three days after demand the amount of such Loan together with interest
thereon, for each day from the date such amount was made available to Borrower
until the date such amount is paid or repaid to Administrative Agent, with
interest at (i) the Federal Funds Rate, if such Lender is making such payment,
and (ii) the interest rate applicable at the time to the other new Loans made on
such date, if Borrower is making such repayment. If neither such Lender nor
Borrower pays or repays to Administrative Agent such amount within such
three-day period, Administrative Agent shall be entitled to recover from
Borrower, on demand in lieu of the interest provided for in the preceding
sentence, interest thereon at the Default Rate, calculated from the date such
amount was made available to Borrower. The failure of any Lender to make any new
Loan to be made by it hereunder shall not relieve any other Lender of its
obligation hereunder, if any, to make its new Loan, but no Lender shall be
responsible for the failure of any other Lender to make any new Loan to be made
by such other Lender. All Borrowings of Loans shall be advanced in Dollars.

 

 

Section 2.3.            Continuations and Conversions of Existing Loans.
Borrower may make the following elections with respect to Loans already
outstanding: (i) to Convert, in whole or in part, Base Rate Loans to Eurodollar
Loans, (ii) to Convert, in whole or in part, Eurodollar Loans to Base Rate Loans
on the last day of the Interest Period applicable thereto, and (iii) to
Continue, in whole or in part, Eurodollar Loans beyond the expiration of such
Interest Period by designating a new Interest Period to take effect at the time
of such expiration. In making such elections, Borrower may combine existing
Loans to Borrower made pursuant to separate Borrowings into one new Borrowing or
divide existing Loans to Borrower made pursuant to one Borrowing into separate
new Borrowings, provided that Borrower may have no more than seven Borrowings of
Eurodollar Loans outstanding at any time. To make any such election, Borrower
must give to Administrative Agent written notice (or telephonic notice promptly
confirmed in writing) of any such Conversion or Continuation of existing Loans,
with a separate notice given

 

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for each new Borrowing. Each such notice constitutes a “Continuation/Conversion
Notice” hereunder and must:

 

(i)            specify the existing Loans which are to be Continued or
Converted;

 

(ii)           specify (A) the aggregate amount of any Borrowing of Base Rate
Loans, into which such existing Loans are to be Continued or Converted and the
date on which such Continuation or Conversion is to occur, or (B) the aggregate
amount of any Borrowing of Eurodollar Loans into which such existing Loans are
to be Continued or Converted, the date on which such Continuation or Conversion
is to occur (which shall be the first day of the Interest Period which is to
apply to such Eurodollar Loans), and the length of the applicable Interest
Period; and

 

(iii)          be received by Administrative Agent not later than 11:00 a.m. New
York, New York time on (i) the day on which any such Continuation or Conversion
to Base Rate Loans is to occur, or (ii) the third Business Day preceding the day
on which any such Continuation or Conversion to Eurodollar Loans is to occur.

 

Each such written request or confirmation must be made in the form and substance
of the “Continuation/Conversion Notice” attached hereto as Exhibit C, duly
completed. Each such telephonic request shall be deemed a representation,
warranty, acknowledgment and agreement by Borrower as to the matters which are
required to be set out in such written confirmation. Upon receipt of any such
Continuation/Conversion Notice, Administrative Agent shall give each Lender
prompt notice of the terms thereof. Each Continuation/Conversion Notice shall be
irrevocable and binding on Borrower. During the continuance of any Default,
Borrower may not make any election to Convert existing Loans into Eurodollar
Loans or Continue existing Loans as Eurodollar Loans beyond the expiration of
their respective and corresponding Interest Period then in effect. If (due to
the existence of a Default or for any other reason) Borrower fails to timely and
properly give any Continuation/Conversion Notice with respect to a Borrowing of
existing Eurodollar Loans at least three days prior to the end of the Interest
Period applicable to such Eurodollar Loans, any such Eurodollar Loans, to the
extent not prepaid at the end of such Interest Period, shall automatically be
Converted into Base Rate Loans at the end of such Interest Period. No new funds
shall be repaid by Borrower or advanced by any Lender in connection with any
Continuation or Conversion of existing Loans pursuant to this section, and no
such Continuation or Conversion shall be deemed to be a new advance of funds for
any purpose; such Continuations and Conversions merely constitute a change in
the interest rate applicable to such already outstanding Loans.

 

 

Section 2.4.            Use of Proceeds. Borrower shall use the Initial Loans to
finance the PPX Acquisition. Borrower shall use the Additional Loans to finance
capital expenditures of any Restricted Person, provide working capital for
operations and for other general business purposes, including acquisitions. In
no event shall the funds from any Loans be used directly or indirectly by any
Person for personal, family, household or agricultural purposes or for the
purpose, whether immediate, incidental or ultimate, of purchasing, acquiring or
carrying any “margin stock” (as such term is defined in Regulation U promulgated
by the Board of Governors of the Federal Reserve System) or to extend credit to
others directly or indirectly for the purpose of purchasing or carrying any such
margin stock. Borrower represents and warrants that it is not

 

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engaged principally, or as one of its important activities, in the business of
extending credit to others for the purpose of purchasing or carrying such margin
stock.

 

Section 2.5.            Interest Rates and Fees.

 

(a)           Interest Rates.

 

(i)            Each Loan shall bear interest as follows: (A) unless the Default
Rate shall apply, each Base Rate Loan shall bear interest on each day
outstanding at the Base Rate plus the Applicable Margin in effect on such day,
and each Eurodollar Loan shall bear interest on each day during the related
Interest Period at the related Eurodollar Rate plus the Applicable Margin in
effect on such day, and (B) during a Default Rate Period, all Loans shall bear
interest on each day outstanding at the applicable Default Rate.

 

(ii)           Accrued and unpaid interest on each Loan shall be due and payable
on each Interest Payment Date; provided, during a Default Rate Period, accrued
and unpaid interest on all Loans shall be due and payable within three Business
Days following demand therefor by Administrative Agent to Borrower. If an Event
of Default based upon Section 8.1(a), Section 8.1(b) or, with respect to
Borrower, based upon Section 8.1(h)(i), (h)(ii) or (h)(iii) exists and the Loans
are not bearing interest at the Default Rate, the past due principal and past
due interest shall bear interest on each day outstanding at the applicable
Default Rate.

 

(iii)          The interest rate shall change whenever the applicable Base Rate,
Eurodollar Rate or Applicable Margin changes. In no event shall the interest
rate on any Loan exceed the Highest Lawful Rate.

 

(b)           Facility Fees; Reduction of Commitments. In consideration of each
Lender’s Commitment, commencing on the Initial Funding Date through the Maturity
Date, Borrower will pay to Administrative Agent for the account of each Lender a
facility fee determined on a daily basis equal to the Facility Fee Rate in
effect on such day times (i) on and after the Initial Funding Date through and
until the earlier of (x) the date on which the Additional Loans are made and (y)
the Conversion Date, an amount equal to the sum of such Lender’s Commitment plus
such Lender’s Initial Loan, and (ii) thereafter, the Outstanding Amount of such
Lender’s Loans. Such facility fee shall be due and payable quarterly in arrears
on the last day of each Fiscal Quarter, on the Conversion Date, and on the
Maturity Date. Borrower shall have the right from time to time to permanently
reduce the Total Committed Amount, provided that (A) notice of such reduction is
given not less than two Business Days prior to such reduction, and (B) each
partial reduction shall be in an amount at least equal to $1,000,000 and in
multiples of $1,000,000 in excess thereof.

 

(c)           Ticking Fees. In consideration of each Lender’s Commitment,
Borrower will pay to Administrative Agent for the account of each Lender a
ticking fee determined on a daily basis equal to the Ticking Fee Rate in effect
on such day times such Lender’s Commitment on each day commencing January 31,
2007 through and until the Initial Funding Date. Such ticking fee shall be due
and payable quarterly in arrears on the last day of each Fiscal Quarter and on
the Initial Funding Date.

 

 

Section 2.6.            Intentionally deleted.

 

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Section 2.7.            Conversion to Term Loan. Effective at 11:59 p.m., New
York, New York time on the day immediately preceding the Conversion Date, each
Lender’s obligation to make new Loans to Borrower shall be canceled
automatically (if not terminated hereunder prior to such date), and, provided
that no Event of Default shall have occurred and be continuing, each Lender’s
Loans shall become term loans maturing on the Maturity Date.

 

Section 2.8.            Optional Prepayments. Borrower may, upon three Business
Days’ notice, as to Eurodollar Loans, or same Business Day’s notice, as to Base
Rate Loans, to Administrative Agent (and Administrative Agent will promptly give
notice to the other Lenders) from time to time and without premium or penalty
(other than any amounts due under Section 3.6 hereof with respect to prepayments
of any Eurodollar Loans) prepay the Loans, in whole or in part, so long as the
aggregate amounts of all partial prepayments of principal on (i) Eurodollar
Loans equals $2,500,000 or any higher integral multiple of $250,000, and (ii)
Base Rate Loans equals $250,000 or any higher integral multiple of $50,000. Upon
receipt of any such notice, Administrative Agent shall give each Lender prompt
notice of the terms thereof. Each prepayment of principal of a Loan under this
section shall be accompanied by all interest then accrued and unpaid on the
principal so prepaid. Any principal or interest prepaid pursuant to this section
shall be in addition to, and not in lieu of, all payments otherwise required to
be paid under the Loan Documents at the time of such prepayment. Following
notice by Borrower pursuant to the foregoing, Borrower shall make such
prepayment, and the prepayment amount specified in such notice shall be due and
payable, on the date specified in such notice.

 

 

Section 2.9.            Mandatory Commitment Reductions and Prepayments.

 

(a)           Mandatory Commitment Reductions – Making of Loans. Upon the making
of the Initial Loans, the Total Committed Amount shall be reduced by the
aggregate amount of such Initial Loans, and each Lender’s Commitment shall be
automatically and permanently reduced by the amount of such Lender’s Initial
Loan. Upon the earlier of the making of the Additional Loans and the Conversion
Date, the Total Committed Amount shall be reduced to zero, and each Lender’s
Commitment shall be automatically and permanently reduced to zero and
terminated.

 

(b)           Mandatory Commitment Reduction – Debt Offerings. Upon the
consummation of any public or private debt offering by Borrower or any of its
Subsidiaries (a “Debt Offering”) on or prior to the Initial Funding Date, the
Total Committed Amount shall be permanently reduced by an amount equal to the
net cash proceeds received by Borrower or any of its Subsidiaries from such Debt
Offering, to the extent such net cash proceeds (i) were designated for use, or
used in connection with, the PPX Acquisition, or (ii) were not designated for
use, or used in connection with, the PPX Acquisition, but when aggregated with
all other such non-designated proceeds, do not exceed $200,000.000.

 

(c)           Mandatory Prepayments – Debt Offering. Upon the consummation of
any Debt Offering (as defined in Section 2.9(b) above) after the Initial Funding
Date, Borrower shall contemporaneously with the receipt of the net cash proceeds
thereof by it or its applicable Subsidiaries make a mandatory prepayment on the
Loans in an amount equal to such net cash proceeds of such Debt Offering.

 

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(d)           Mandatory Prepayments – Principal Property Sales. Following the
consummation of the PPX Acquisition, in the event Borrower or any of its
Subsidiaries shall sell, lease or otherwise dispose of Principal Property
acquired pursuant to the PPX Acquisition to any Person other than a Restricted
Person (other than in exchange for property of like kind or otherwise useful in
Restricted Persons’ businesses and properties) pursuant to which Borrower and
its Subsidiaries receive aggregate net cash proceeds with respect to such sales,
leases or other dispositions in excess of $25,000,000, Borrower and/or such
Subsidiaries shall, within one year of the date on which such aggregate proceeds
exceed such amount, either use or enter into a binding contractual commitment to
use, such proceeds to acquire, construct, rebuild or repair capital assets to be
used or useful in Borrower’s and its Subsidiaries’ business (including the
acquisition of equity interests in one or more Persons owning such assets) or
make a mandatory prepayment on the Loans in an amount equal to the amount of
such proceeds not so used. Upon receipt by Borrower or such Subsidiary of any
such proceeds and until the application thereof as provided in the foregoing
sentence, Borrower or such Subsidiary may use such proceeds to prepay loans
under the US/Canada Credit Agreement or otherwise shall maintain such proceeds
in cash or cash equivalents.

 

(e)           Accrued and Unpaid Interest. Each prepayment of principal under
this section shall be accompanied by all interest then accrued and unpaid on the
principal so prepaid. Any principal or interest prepaid pursuant to this section
shall be in addition to, and not in lieu of, all payments otherwise required to
be paid under the Loan Documents at the time of such prepayment.

 

ARTICLE III. - PAYMENTS TO LENDERS

 

Section 3.1.            General Procedures.

 

(a)           Each Restricted Person shall pay all amounts owing by such
Restricted Person with respect to any Obligations (whether for principal,
interest, fees, or otherwise) to Administrative Agent for the account of the
Lender Party to whom such payment is owed in Dollars, without condition or
deduction for any counterclaim, defense, recoupment or setoff, and in
immediately available funds. If any payment is received on account of any
Obligation in any currency other than Dollars (whether voluntarily or pursuant
to any order or judgment or the enforcement thereof or the realization of any
security or the liquidation of any Person or otherwise howsoever), such payment
shall constitute a discharge of the liability of a Restricted Person hereunder
and under the other Loan Documents in respect of such Obligation only to the
extent of the amount of Dollars which the relevant Lender Parties are able to
purchase with the amount of the other currency received by it on the Business
Day next following such receipt by Administrative Agent in accordance with its
normal procedures and after deducting any premium and costs of exchange. Each
payment under the Loan Documents must be received by Administrative Agent not
later than noon, New York, New York time on the date such payment becomes due
and payable, unless otherwise expressly provided herein. Any payment received by
Administrative Agent after such time will be deemed to have been made on the
next following Business Day. Should any such payment become due and payable on a
day other than a Business Day, the maturity of such payment shall be extended to
the next succeeding Business Day, and, in the case of a payment of principal or
past due interest, interest shall accrue and be payable thereon for the period
of such extension as provided in the Loan Document under which

 

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such payment is due. Each payment under a Loan Document to a Lender Party shall
be due and payable at the place provided therein and, if no specific place of
payment is provided, shall be due and payable at the place of payment of
Administrative Agent’s Note.

 

(b)           When Administrative Agent collects or receives money on account of
the Obligations, Administrative Agent shall distribute all money so collected or
received, and each Lender Party shall apply all such money so distributed, as
follows:

 

(i)            first, for the payment of all Obligations which are then due (and
if such money is insufficient to pay all such Obligations, first to any
reimbursements due Administrative Agent under Section 10.4 and then to the
partial payment of all other Obligations then due in proportion to the amounts
thereof, or as Lender Parties shall otherwise agree);

 

(ii)           then for the prepayment of amounts owing under the Loan Documents
(other than principal on the Notes) if so specified by Borrower;

 

(iii)          then for the prepayment of principal on the Notes, together with
accrued and unpaid interest on the principal so prepaid; and

 

(iv)          last, for the payment or prepayment of any other Obligations.

 

All payments applied to principal or interest on any Note shall be applied first
to any interest then due and payable, then to principal then due and payable,
and last to any prepayment of principal and accrued interest thereon in
compliance with Sections 2.8 and 2.9, as applicable. All distributions of
amounts described in any of subsections (ii), (iii), or (iv) above shall be made
by Administrative Agent pro rata to each Lender Party then owed Obligations
described in such subsection in proportion to all amounts owed to all Lender
Parties which are described in such subsection; provided that if any Lender then
owes payments to Administrative Agent under Section 9.10, any amounts otherwise
distributable under this section to such Lender shall be deemed to belong to
Administrative Agent to the extent of such unpaid payments, and Administrative
Agent shall apply such amounts to make such unpaid payments rather than
distribute such amounts to such Lender.

 

(c)           Unless Administrative Agent shall have received notice from
Borrower prior to the date on which any payment is due to Administrative Agent
for the account of the Lenders that Borrower will not make such payment,
Administrative Agent may assume that Borrower has made such payment on such date
in accordance herewith and may, in reliance upon such assumption, distribute to
the appropriate Lenders the amount due. In such event, if Borrower has not in
fact made such payment, then each of such Lenders severally agrees to repay to
Administrative Agent forthwith on demand the amount so distributed to such
Lender in immediately available funds with interest thereon, for each day from
and including the date such amount is distributed to it to but excluding the
date of payment to Administrative Agent at the greater of the Federal Funds Rate
and a rate determined by Administrative Agent in accordance with banking
industry rules on interbank compensation. A notice of Administrative Agent to
any Lender with respect to any amount owing under this subsection (c) shall be
conclusive, absent manifest error.

 

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Section 3.2.            Capital Reimbursement. If either (a) the introduction or
implementation of or the compliance with or any change in or in the
interpretation of any Law, or (b) the introduction or implementation of or the
compliance with any request, directive or guideline from any central bank or
other governmental authority (whether or not having the force of Law) affects or
would affect the amount of capital required or expected to be maintained by any
Lender Party or any corporation controlling any Lender Party, then, within five
Business Days after demand by such Lender Party, Borrower will pay to
Administrative Agent for the benefit of such Lender Party, from time to time as
specified by such Lender Party, such additional amount or amounts which such
Lender Party shall determine to be appropriate to compensate such Lender Party
or any corporation controlling such Lender Party in light of such circumstances,
to the extent that such Lender Party reasonably determines that the amount of
any such capital would be increased or the rate of return on any such capital
would be reduced by or in whole or in part based on the existence of the face
amount of such Lender Party’s Loans or commitments under this Agreement.

 

Section 3.3.            Increased Cost of Eurodollar Loans. If any applicable
Law (whether now in effect or hereinafter enacted or promulgated, including
Regulation D) or any interpretation or administration thereof by any
governmental authority charged with the interpretation or administration thereof
(whether or not having the force of Law):

 

(a)           shall change the basis of taxation of payments to any Lender Party
of any principal, interest, or other amounts attributable to any Eurodollar Loan
or otherwise due under this Agreement in respect of any Eurodollar Loan (other
than taxes imposed on, or measured by such Lender’ Party’s overall net income
(however denominated), and franchise taxes imposed on such Lender Party (in lieu
of net income taxes) or any Applicable Lending Office of such Lender Party by
any jurisdiction in which such Lender Party or any such Applicable Lending
Office is located); or

 

(b)           shall change, impose, modify, apply or deem applicable any
reserve, special deposit or similar requirements in respect of any Eurodollar
Loan (excluding those for which such Lender Party is fully compensated pursuant
to adjustments made in the definition of Eurodollar Rate) or against assets of,
deposits with or for the account of, or credit extended by, such Lender Party;
or

 

(c)           shall impose on any Lender Party or the interbank Eurocurrency
deposit market any other condition affecting any Eurodollar Loan, the result of
which is to increase the cost to any Lender Party of funding or maintaining any
Eurodollar Loan or to reduce the amount of any sum receivable by any Lender
Party in respect of any Eurodollar Loan by an amount deemed by such Lender Party
to be material, then such Lender Party shall promptly notify Administrative
Agent and Borrower in writing of the happening of such event and of the amount
required to compensate such Lender Party for such event (on an after-tax basis,
taking into account any taxes on such compensation), whereupon (i) Borrower
shall, within five Business Days after demand therefor by such Lender Party, pay
such amount to Administrative Agent for the account of such Lender Party and
(ii) Borrower may elect, by giving to Administrative Agent and such Lender Party
not less than three Business Days’ notice, to Convert all (but not less than
all) of any such Eurodollar Loans into Base Rate Loans.

 

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Section 3.4.            Notice; Change of Applicable Lending Office. A Lender
Party shall notify Borrower of any event occurring after the date of this
Agreement that will entitle such Lender Party to compensation under Section 3.2,
3.3, or 3.5 hereof as promptly as practicable, but in any event within 180 days,
after such Lender Party obtains actual knowledge thereof; provided, that (i) if
such Lender Party fails to give such notice within 180 days after it obtains
actual knowledge of such an event, such Lender Party shall, with respect to
compensation payable pursuant to Section 3.2, 3.3, or 3.5 in respect of any
costs resulting from such event, only be entitled to payment under Section 3.2,
3.3, or 3.5 hereof for costs incurred from and after the date 180 days prior to
the date that such Lender Party does give such notice and (ii) such Lender Party
will designate a different Applicable Lending Office for the Loans affected by
such event if such designation will avoid the need for, or reduce the amount of,
such compensation and will not, in the sole opinion of such Lender Party, be
disadvantageous to such Lender Party, except that such Lender Party shall have
no obligation to designate an Applicable Lending Office located in the United
States of America. Each Lender Party will furnish to Borrower a certificate
setting forth the basis and amount of each request by such Lender Party for
compensation under Section 3.2, 3.3, or 3.5 hereof.

 

Section 3.5.            Availability. If (a) any change in applicable Laws, or
in the interpretation or administration thereof of or in any jurisdiction
whatsoever, domestic or foreign, shall make it unlawful or impracticable for any
Lender Party to fund or maintain Eurodollar Loans, or shall materially restrict
the authority of any Lender Party to purchase or take offshore deposits of
dollars (i.e., “Eurodollars”), or (b) any Lender Party determines that matching
deposits appropriate to fund or maintain any Eurodollar Loan are not available
to it, or (c) any Lender Party determines that the formula for calculating the
Eurodollar Rate does not fairly reflect the cost to such Lender Party of making
or maintaining loans based on such rate, with respect to the Commitment
hereunder, then, upon notice by such Lender Party to Borrower and Administrative
Agent, Borrower’s right to elect Eurodollar Loans from such Lender Party shall
be suspended to the extent and for the duration of such illegality,
impracticability or restriction and all Eurodollar Loans of such Lender Party
which are then outstanding or are then the subject of any Borrowing Notice and
which cannot lawfully or practicably be maintained, funded or accepted shall
immediately become or remain, or shall be funded as, Base Rate Loans of such
Lender Party. With respect to each Commitment, Borrower agrees to indemnify each
Lender Party extending credit pursuant thereto, and hold each such Lender Party
harmless against all costs, expenses, claims, penalties, liabilities and damages
which may result from any such change in Law, interpretation or administration.
Such indemnification shall be on an after-tax basis, taking into account any
taxes imposed on the amounts paid as indemnity.

 

Section 3.6.            Funding Losses. In addition to its other obligations
hereunder, with respect to each Commitment, Borrower will indemnify each Lender
Party extending credit pursuant thereto against, and reimburse each Lender Party
on demand for, any loss or expense incurred or sustained by such Lender Party
(including any loss or expense incurred by reason of the liquidation or
reemployment of deposits or other funds acquired by such Lender Party to fund or
maintain Eurodollar Loans), as a result of (a) any payment or prepayment
(whether or not authorized or required hereunder) of all or a portion of a
Eurodollar Loan on a day other than the day on which the applicable Interest
Period ends, (b) any payment or prepayment, whether or not required hereunder,
of a Loan made after the delivery, but before the effective date, of a
Continuation/Conversion Notice, if such payment or prepayment prevents such

 

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Continuation/Conversion Notice from becoming fully effective, (c) the failure of
any Loan to be made or of any Continuation/Conversion Notice to become effective
due to any condition precedent not being satisfied or due to any other action or
inaction of any Restricted Person, or (d) any Conversion (whether or not
authorized or required hereunder) of all or any portion of any Eurodollar Loan
into a Base Rate Loan or into a different Eurodollar Loan on a day other than
the day on which the applicable Interest Period ends. Such indemnification shall
be on an after-tax basis, taking into account any taxes imposed on the amounts
paid as indemnity.

 

Section 3.7.            Reimbursable Taxes.  With respect to the Commitments,
Borrower covenants and agrees with each Lender Party extending credit pursuant
thereto that:

 

(a)           Borrower will indemnify each such Lender Party against and
reimburse each such Lender Party for all present and future stamp and other
taxes, duties, levies, imposts, deductions, charges, costs, and withholdings
whatsoever imposed, assessed, levied or collected on or in respect of this
Agreement, any Eurodollar Loans (whether or not legally or correctly imposed,
assessed, levied or collected), excluding, however, any taxes imposed on or
measured by the overall net income (however denominated) and franchise taxes
imposed on (in lieu of income taxes) Administrative Agent or such Lender Party
or any Applicable Lending Office of such Lender Party by any jurisdiction in
which such Lender Party or any such Applicable Lending Office is located (all
such non-excluded taxes, levies, costs and charges being collectively called
“Reimbursable Taxes” in this section). Such indemnification shall be on an
after-tax basis, taking into account any taxes imposed on the amounts paid as
indemnity.

 

(b)           All payments on account of the principal of, and interest on, each
such Lender Party’s Loans and Notes, and all other amounts payable by Borrower
to any such Lender Party hereunder, shall be made in full without set-off or
counterclaim and shall be made free and clear of and without deductions or
withholdings of any nature by reason of any Reimbursable Taxes, all of which
will be for the account of Borrower. In the event of Borrower being compelled by
Law to make any such deduction or withholding from any payment to any such
Lender Party, Borrower shall pay on the due date of such payment, by way of
additional interest, such additional amounts as are needed to cause the amount
receivable by such Lender Party after such deduction or withholding to equal the
amount which would have been receivable in the absence of such deduction or
withholding. If Borrower should make any deduction or withholding as aforesaid,
Borrower shall within 60 days thereafter forward to such Lender Party an
official receipt or other official document evidencing payment of such deduction
or withholding.

 

(c)           If Borrower is ever required to pay any Reimbursable Tax with
respect to any Eurodollar Loan, Borrower may elect, by giving to Administrative
Agent and such Lender Party not less than three Business Days’ notice, to
Convert all (but not less than all) of any such Eurodollar Loan into a Base Rate
Loan, but such election shall not diminish Borrower’s obligation to pay all
Reimbursable Taxes.

 

(d)           Notwithstanding the foregoing provisions of this section, Borrower
shall be entitled, to the extent it is required to do so by Law, to deduct or
withhold (and not to make any indemnification or reimbursement for) income or
other similar taxes imposed by the United States of America (other than any
portion thereof attributable to a change in federal income tax Laws effected
after the date hereof) from interest, fees or other amounts payable hereunder
for

 

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the account of such Lender Party, other than such a Lender Party (i) who is a US
person for Federal income tax purposes or (ii) who has the Prescribed Forms on
file with Administrative Agent (with copies provided to Borrower) for the
applicable year to the extent deduction or withholding of such taxes is not
required as a result of the filing of such Prescribed Forms, provided that if
Borrower shall so deduct or withhold any such taxes, it shall provide a
statement to Administrative Agent and such Lender Party, setting forth the
amount of such taxes so deducted or withheld, the applicable rate and any other
information or documentation which such Lender Party may reasonably request for
assisting such Lender Party to obtain any allowable credits or deductions for
the taxes so deducted or withheld in the jurisdiction or jurisdictions in which
such Lender Party is subject to tax. As used in this section, “Prescribed Forms”
means such duly executed forms or statements, and in such number of copies,
which may, from time to time, be prescribed by Law and which, pursuant to
applicable provisions of (x) an income tax treaty between the United States and
the country of residence of such Lender Party providing the forms or statements,
(y) the Code, or (z) any applicable rules or regulations thereunder, permit
Borrower to make payments hereunder for the account of such Lender Party free of
such deduction or withholding of income or similar taxes.

 

Section 3.8.            Replacement of Lenders. If any Lender Party requests
compensation under Sections 3.2 through 3.7, or if any Lender Party has failed
to fund any portion of the Loans required to be funded by it hereunder within
two Business Days of the date required for such funding hereunder,
notwithstanding subsequent cure, then Borrower may, at its sole expense (except
as otherwise provided hereunder) and effort, upon notice to such Lender Party
and Administrative Agent, require such Lender Party to assign and delegate (in
accordance with and subject to the restrictions contained in, and consents
required by, Section 10.5), all of its interests, rights and obligations under
this Agreement and the related Loan Documents to an assignee that shall assume
such obligations (which assignee may be another Lender Party, if a Lender Party
accepts such assignment), provided that:

 

(a)           such Lender Party shall have received payment of an amount equal
to the outstanding principal of its Loans, accrued interest thereon, accrued
fees and all other amounts payable to it hereunder and under the other Loan
Documents (including any amounts under Section 3.6) from the assignee (to the
extent of such outstanding principal and accrued interest and fees) Borrower (in
the case of all other amounts); and

 

(b)           such assignment does not conflict with applicable Laws.

 

Notwithstanding the foregoing rights of Borrower under this section, however,
Borrower may not replace any Lender Party which seeks reimbursement for
increased costs under Section 3.2 through 3.7 unless Borrower is at the same
time replacing all Lender Parties which are then seeking such compensation.

 

Section 3.9.            Currency Conversion and Indemnity.

 

(a)           If, for the purpose of obtaining or enforcing judgment in any
court in any jurisdiction, it becomes necessary to convert into a particular
currency (the “Judgment Currency”) any amount due under a Loan Document in the
currency in which it was effected (the “Agreed Currency”) then the conversion
shall be made on the basis of the rate of exchange

 

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prevailing on the Business Day preceding the date such judgment is given and in
any event each Restricted Person obligated to pay such Obligation shall be
obligated to pay the relevant Lender Parties any deficiency in accordance with
Section 3.9(b). For the foregoing purposes “rate of exchange” means the rate at
which Administrative Agent in accordance with its normal banking procedures is
able on the relevant date to purchase the Agreed Currency with the Judgment
Currency after deducting any premium and costs of exchange.

 

(b)           If any Lender Party receives any payment or payments on account of
the liability of a Restricted Person under the Loan Documents pursuant to any
judgment or order in any currency other than the Agreed Currency (an “Other
Currency”), and the amount of the Agreed Currency which the relevant Lender
Party is able to purchase on the Business Day next following such receipt with
the proceeds of such payment or payments in accordance with its normal
procedures and after deducting any premiums and costs of exchange is less than
the amount of the Agreed Currency due in respect of such Obligations immediately
prior to such judgment or order, then Borrower on demand shall, and Borrower
hereby agrees to, indemnify and save such Lender Party harmless from and against
any loss, cost or expense arising out of or in connection with such deficiency.
The agreement of indemnity provided for in this Section 3.9(b) shall constitute
an obligation separate and independent from all other obligations contained in
this Agreement, shall give rise to a separate and independent cause of action,
shall apply irrespective of any indulgence granted by the Lender Parties or any
of them from time to time, and shall continue in full force and effect
notwithstanding any judgment or order for a liquidated sum in respect of an
amount due hereunder or under any judgment or order.

 

ARTICLE IV. - CONDITIONS PRECEDENT TO LENDING

 

Section 4.1.            Documents to be Delivered – Closing Date. No Lender has
any obligation to make its Initial Loan, and this Agreement shall not be
effective, unless Administrative Agent shall have received all of the following,
at Administrative Agent’s office in New York, New York, duly executed and
delivered and in form, substance and date satisfactory to Administrative Agent
(the receipt of which by Administrative Agent shall be evidenced by it
notification of the effectiveness hereof):

 

(a)           This Agreement and any other document that Lenders are to execute
in connection herewith.

 

(b)           Each Note and the guaranty of each Guarantor.

 

(c)           Certain certificates including:

 

(i)            An “Omnibus Certificate” of the secretary or assistant secretary
and any vice president of GP LLC, which shall contain the names and signatures
of the officers of GP LLC authorized to execute Loan Documents and which shall
certify to the truth, correctness and completeness of the following exhibits
attached thereto:  (1) a copy of resolutions duly adopted by the Board and in
full force and effect at the time this Agreement is entered into, authorizing
the execution of this Agreement and the other Loan Documents delivered or to be
delivered in connection herewith and the consummation of the transactions
contemplated herein and therein, (2) a copy of the

 

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charter documents of Borrower and all amendments thereto, certified by the
appropriate official of its jurisdiction of organization, and (3) a copy of the
agreement of limited partnership of Borrower;

 

(ii)           An “Omnibus Certificate” of the secretary or assistant secretary
and any vice president of Plains Marketing GP Inc., which shall contain the
names and signatures of the officers of such company authorized to execute Loan
Documents and which shall certify to the truth, correctness and completeness of
the following exhibits attached thereto:  (1) a copy of resolutions duly adopted
by the board of directors of such company and in full force and effect at the
time this Agreement is entered into, authorizing the execution of the Loan
Documents delivered or to be delivered in connection herewith and the
consummation of the transactions contemplated therein, (2) a copy of the charter
documents of each Significant Restricted Person, other than those Significant
Restricted Persons whose charter documents are attached to the certificates
described in Section 4.1(c)(i) above or Section 4.1(c)(iii) below and all
amendments thereto, certified by the appropriate official of its jurisdiction of
organization, and (3) a copy of any bylaws or agreement of limited partnership
of such Significant Restricted Persons;

 

(iii)          An “Omnibus Certificate” of the secretary or assistant secretary
and any vice president of PMC (Nova Scotia) Company, which shall contain the
names and signatures of the officers of PMC (Nova Scotia) Company authorized to
execute Loan Documents and which shall certify to the truth, correctness and
completeness of the following exhibits attached thereto:  (1) a copy of
resolutions duly adopted by the board of directors of PMC (Nova Scotia) Company
and in full force and effect at the time this Agreement is entered into,
authorizing the execution of the Loan Documents delivered or to be delivered in
connection herewith and the consummation of the transactions contemplated
therein, (2) a copy of the charter documents of PMC (Nova Scotia) Company and
Plains Marketing Canada, L.P. and all amendments thereto, certified by the
appropriate official of its jurisdiction of organization, and (3) a copy of the
bylaws of PMC (Nova Scotia) Company and the agreement of limited partnership of 
Plains Marketing Canada, L.P.; and

 

(iv)          A certificate of a Responsible Officer of GP LLC, regarding
satisfaction of Section 4.2.

 

(d)           A certificate (or certificates) of the due formation, valid
existence and good standing of each Significant Restricted Person in its
respective jurisdiction of organization, issued by the appropriate authorities
of such jurisdiction.

 

(e)           Favorable opinions of Tim Moore, Esq., General Counsel for
Restricted Persons, substantially in the form set forth in Exhibit E-1,
Fulbright & Jaworski L.L.P., special Texas and New York counsel to Restricted
Persons, substantially in the form set forth in Exhibit E-2, and Bennett Jones
LLP, special Canadian Counsel for Restricted Persons, substantially in the form
set forth in Exhibit E-3.

 

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(f)            Consolidated financial statements of Borrower and its
Subsidiaries as of March 31, 2006, reflecting compliance with Section 7.8,
together with a certificate by a Responsible Officer of GP LLC certifying such
financial statements.

 

(g)           No Material Adverse Change shall have occurred since December 31,
2005.

 

(h)           Administrative Agent shall have received all documents and
instruments which Administrative Agent has then requested (including opinions of
legal counsel for Restricted Persons and Administrative Agent; corporate
documents and records; documents evidencing governmental authorizations,
consents, approvals, licenses and exemptions; and certificates of public
officials and of officers and representatives of Borrower and other Persons), as
to (i) the accuracy and validity of or compliance with all representations,
warranties and covenants made by any Restricted Person in this Agreement and the
other Loan Documents, (ii) the satisfaction of all conditions contained herein
or therein, and (iii) all other matters pertaining hereto and thereto. All such
additional documents and instruments shall be satisfactory to Administrative
Agent in form and substance.

 

(i)            Payment of all commitment, facility, agency and other fees
required to be paid to Administrative Agent or any Lender pursuant to any Loan
Documents or any commitment agreement heretofore entered into.

 

Without limiting the generality of the provisions of Section 9.4, for purposes
of determining compliance with the conditions specified in this Section 4.1,
each Lender that has signed this Agreement shall be deemed to have consented to,
approved or accepted or to be satisfied with, each document or other matter
required thereunder to be consented to or approved by or acceptable or
satisfactory to a Lender unless Administrative Agent shall have received notice
from such Lender prior to the proposed Closing Date specifying its objection
thereto, and  Administrative Agent hereby agrees to promptly provide Borrower
with a copy of any such notice received by Administrative Agent.

 

Section 4.2.            Additional Conditions Precedent. No Lender has any
obligation to make any Loan (including its Initial Loan), unless the following
conditions precedent have been satisfied:

 

(a)           All representations and warranties made by any Restricted Person
in any Loan Document shall be true on and as of the date of such Loan as if such
representations and warranties had been made as of the date of such Loan except
to the extent that such representation or warranty was made as of a specific
date or updated, modified or supplemented as of a subsequent date with the
consent of Majority Lenders, then in each such case, such other date.

 

(b)           No Default shall exist at the date of such Loan or result from
such Loan.

 

Section 4.3.            Initial Funding Date – Conditions Precedent. No Lender
has any obligation to make its Initial Loan unless the following conditions
precedent have been satisfied:

 

(a)           Administrative Agent shall have received copies of the PPX
Acquisition Documents and any other related documents as Administrative Agent
may reasonably request

 

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and a certificate of a Responsible Officer of GP LLC dated the Initial Funding
Date certifying as to Borrower’s representations and warranties set forth in
Section 4.3(b).

 

(b)           The following representations and warranties of Borrower shall be
true on and as of the Initial Funding Date:

 

(i) the copies of the PPX Acquisition Documents delivered pursuant to Section
4.3(a) are accurate and complete and represent in all material respects the
complete understanding and agreement of the parties thereto,

 

(ii) Borrower has obtained all material approvals required by the United States
Federal Trade Commission, the California Public Utility Commission or any other
Governmental Authority,

 

(iii) subject only to the making of the Initial Loans and application of the
proceeds thereof, all conditions precedent to the consummation of the PPX
Acquisition under the PPX Acquisition Documents have been satisfied or waived,

 

(iv) substantially contemporaneously with the making of the Initial Loans, the
plan of merger included within the PPX Acquisition Documents is to be filed and
pursuant thereto the PPX Acquisition is to be consummated in compliance with the
terms and conditions thereof in all material respects.

 

In connection with the foregoing, Borrower agrees that pending application of
the proceeds of the Initial Loans by Borrower in connection with the PPX
Acquisition, Borrower shall retain such proceeds in a deposit account maintained
at either JPMorgan Chase Bank, N.A. or Bank of America, N.A.

 

ARTICLE V. - REPRESENTATIONS AND WARRANTIES

 

To confirm each Lender’s understanding concerning Restricted Persons and
Restricted Persons’ businesses, properties and obligations and to induce each
Lender to enter into this Agreement and to extend credit hereunder, Borrower
represents and warrants to each Lender that:

 

Section 5.1.            No Default. No event has occurred and is continuing
which constitutes a Default, except as has been waived in accordance with this
Agreement.

 

Section 5.2.            Organization and Good Standing. Each Significant
Restricted Person is duly organized or formed, validly existing and in good
standing under the Laws of its jurisdiction of organization or formation, having
all requisite corporate or similar powers required to carry on its business and
enter into and carry out the transactions contemplated hereby. Each Significant
Restricted Person is duly qualified, in good standing, and authorized to do
business in all other jurisdictions wherein the character of the properties
owned or held by it or the nature of the business transacted by it makes such
qualification necessary except where the failure to so qualify would not
reasonably be expected to cause a Material Adverse Change.

 

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Section 5.3.            Authorization. Each Restricted Person has duly taken all
action necessary to authorize the execution and delivery by it of the Loan
Documents to which it is a party and to authorize the consummation of the
transactions contemplated thereby and the performance of its obligations
thereunder. Borrower is duly authorized to borrow funds hereunder.

 

Section 5.4.            No Conflicts or Consents. The execution and delivery by
each Restricted Person of the Loan Documents to which it is a party, the
performance by it of its obligations, and the consummation of the transactions
contemplated thereby, do not and will not (i) violate any provision of (1) Law
applicable to it, (2) its organizational documents or (3) any judgment, order or
material license or permit applicable to or binding upon it, (ii) result in the
acceleration of any Indebtedness owed by it or (iii) result in or require the
creation of any consensual Lien upon any of its material assets or properties
except as expressly contemplated in, or permitted by, the Loan Documents. Except
as expressly contemplated in or permitted by the Loan Documents, disclosed in
the Disclosure Schedule or disclosed pursuant to Section 6.4, no permit,
consent, approval, authorization or order of, and no notice to or filing,
registration or qualification with, any Governmental Authority is required on
the part of any Restricted Person a party thereto pursuant to the provisions of
any material Law applicable to it as a condition to its execution, delivery or
performance of any Loan Document or (ii) to consummate any transactions
contemplated by the Loan Documents.

 

Section 5.5.            Enforceable Obligations. This Agreement is, and the
other Loan Documents when duly executed and delivered will be, legal, valid and
binding obligations of each Restricted Person which is a party hereto or
thereto, enforceable in accordance with their terms except as such enforcement
may be limited by bankruptcy, insolvency or similar Laws of general application
relating to the enforcement of creditors’ rights and general principles of
equity.

 

Section 5.6.            Initial Financial Statements. Borrower has heretofore
delivered to each Lender true, correct and complete copies of the Initial
Financial Statements. The Initial Financial Statements fairly present Borrower’s
Consolidated financial position at the date thereof and the Consolidated results
of Borrower’s operations for the periods thereof, and in the case of the annual
Initial Financial Statements, Consolidated cash flows for the period thereof.
Except as disclosed pursuant to Section 6.4, since the date of the annual
Initial Financial Statements, no Material Adverse Change has occurred. All
Initial Financial Statements described in clause (i) of that defined term were
prepared in accordance with GAAP.

 

Section 5.7.            Other Obligations and Restrictions. As of the Closing
Date, no Restricted Person has any outstanding payment obligations of any kind
(including contingent obligations, tax assessments and unusual forward or
long-term commitments) which are, in the aggregate, material to Borrower or
material with respect to Borrower’s Consolidated financial condition and not
reflected in the Initial Financial Statements, disclosed in the Disclosure
Schedule or otherwise permitted under Section 7.1. Except as disclosed in the
Disclosure Schedule or pursuant to Section 6.4, no Restricted Person is subject
to or restricted by any franchise, contract, deed, charter restriction, or other
instrument or restriction which would reasonably be expected to cause a Material
Adverse Change.

 

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Section 5.8.            Full Disclosure. No certificate, statement or other
information delivered herewith or heretofore by any Restricted Person to any
Lender in connection with the negotiation of this Agreement or in connection
with any transaction contemplated hereby contains any untrue statement of a
material fact or omits to state any material fact necessary to make the
statements contained herein or therein, in light of the circumstances under
which they were made, not misleading as of the date made or deemed made (or if
such information expressly relates or refers to an earlier date, as of such
earlier date). All written information furnished after the date hereof by or on
behalf of any Restricted Person to Administrative Agent or any Lender Party in
connection with this Agreement and the other Loan Documents and the transactions
contemplated hereby and thereby will be true, complete and accurate in every
material respect in light of the circumstances in which made or based on
reasonable estimates, in each case as of the date on which such information is
stated or certified (or if such information expressly relates or refers to an
earlier date, as of such earlier date). There is no fact known to any Restricted
Person that has not been disclosed to each Lender in writing which would
reasonably be expected to cause a Material Adverse Change.

 

Section 5.9.            Litigation. Except as disclosed in the Initial Financial
Statements, in the Disclosure Schedule or pursuant to Section 6.4:  (i) there
are no actions, suits or legal, equitable, arbitrative or administrative
proceedings pending, or to the knowledge of any Restricted Person overtly
threatened, against any Restricted Person before any Governmental Authority
having jurisdiction over it which would reasonably be expected to cause a
Material Adverse Change, and (ii) there are no outstanding judgments,
injunctions, writs, rulings or orders by any such Governmental Authority having
jurisdiction over it against any Restricted Person or, to the knowledge of
Borrower, any Restricted Person’s stockholders, partners, directors or officers
which would reasonably be expected to cause a Material Adverse Change.

 

Section 5.10.          ERISA Plans and Liabilities. All currently existing ERISA
Plans are listed in the Disclosure Schedule or pursuant to Section 6.4. Except
as disclosed in the Initial Financial Statements, in the Disclosure Schedule or
pursuant to Section 6.4, no Termination Event has occurred with respect to any
ERISA Plan and all ERISA Affiliates are in compliance with ERISA in all material
respects, to the extent that the non-compliance therewith would not be
reasonably expected to cause a Material Adverse Change. No ERISA Affiliate is
required to contribute to, or has any other absolute or contingent liability in
respect of, any “multiemployer plan” as defined in Section 4001 of ERISA. Except
as set forth in the Disclosure Schedule or disclosed pursuant to Section 6.4: 
(i) no “accumulated funding deficiency” (as defined in Section 412(a) of the
Code) exists with respect to any ERISA Plan, whether or not waived by the
Secretary of the Treasury or his delegate, and (ii) the current value of each
ERISA Plan’s benefits does not exceed the current value of such ERISA Plan’s
assets available for the payment of such benefits by more than $5,000,000.

 

Section 5.11.          Compliance with Permits, Consents and Law. Except as set
forth in the Disclosure Schedule or pursuant to Section 6.4, each Restricted
Person has all permits, licenses and authorizations required in connection with
the conduct of its businesses, except to the extent failure to have any such
permit, license or authorization would not reasonably be expected to cause a
Material Adverse Change. Except as set forth in the Disclosure Schedule or
pursuant to Section 6.4, each Restricted Person is in compliance with the terms
and conditions of all such permits, licenses and authorizations, and is also in
compliance with all other limitations,

 

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restrictions, conditions, standards, prohibitions, requirements, obligations,
schedules and timetables contained in any Law, including applicable
Environmental Law, or in any regulation, code, plan, order, decree, judgment,
injunction, notice or demand letter issued, entered, promulgated or approved
thereunder, except to the extent that non-compliance therewith would not
reasonably be expected to cause a Material Adverse Change or such term,
restriction or otherwise is being contested in good faith or a bona fide dispute
exists with respect thereto.

 

Section 5.12.          Environmental Laws. Except as set forth in the Disclosure
Schedule or disclosed pursuant to Section 6.4, (i) Borrower and its Subsidiaries
are conducting their businesses in material compliance with all applicable Laws,
including Environmental Laws, and have and are in compliance with all licenses
and permits required under any such Laws, unless failure to so comply or have
such licenses and permits would not reasonably be expected to cause a Material
Adverse Change; (ii) none of the operations or properties of Borrower or any of
its Subsidiaries is the subject of federal, provincial or local investigation
evaluating whether any material remedial action is needed to respond to a
release of any Hazardous Materials into the environment or to the improper
storage or disposal (including storage or disposal at offsite locations) of any
Hazardous Materials, unless such remedial action would not reasonably be
expected to cause a Material Adverse Change; and (iii) neither Borrower nor any
of its Subsidiaries (and to the actual knowledge of Borrower, no other Person)
has filed any notice under any Law indicating that any Restricted Person is
responsible for the improper release into the environment, or the improper
storage or disposal, of any material amount of any Hazardous Materials or that
any Hazardous Materials have been improperly released, or are improperly stored
or disposed of, upon any property of any such Person, other than of an alleged
improper release, storage or disposal that would not reasonably be expected to
cause a Material Adverse Change.

 

Section 5.13.          Borrower’s Subsidiaries. Borrower has no Subsidiary and
owns no stock in any other corporation or association except as listed in the
Disclosure Schedule or disclosed after the Closing Date to Administrative Agent
in writing. No Restricted Person is a member of any general or limited
partnership, limited liability company, joint venture or association of any type
whatsoever except those listed in the Disclosure Schedule or disclosed after the
Closing Date to Administrative Agent in writing. Borrower owns, directly or
indirectly, the equity interest in each of its Subsidiaries which is indicated
in the Disclosure Schedule except as disclosed after the Closing Date to
Administrative Agent.

 

Section 5.14.          Title to Properties. Each Restricted Person has good and
defensible title to all of its material properties and assets, free and clear of
all Liens (other than Permitted Liens) and of all impediments to the use of such
properties and assets in such Restricted Person’s business, other than such
impediments that would not reasonably be expected to cause a Material Adverse
Change.

 

Section 5.15.          Government Regulation. Neither Borrower nor any other
Restricted Person owing Obligations is subject to regulation under the
Investment Company Act of 1940 (as amended) or any other Law which regulates the
incurring by such Person of Indebtedness, including Laws relating to common
contract carriers or the sale of electricity, gas, steam, water or other public
utility services. Neither Borrower nor any other Restricted Person is subject to

 

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regulation under the Federal Power Act which would violate, result in a default
of, or prohibit the effectiveness or the performance of any of the provisions of
the Loan Documents.

 

Section 5.16.          Insider. No Restricted Person, nor any Person having
“control” (as that term is defined in 12 U.S.C. § 375b(9) or in regulations
promulgated pursuant thereto) of any Restricted Person, is a “director” or an
“executive officer” or “principal shareholder” (as those terms are defined in 12
U.S.C. § 375b(8) or (9) or in regulations promulgated pursuant thereto) of any
Lender, of a bank holding company of which any Lender is a Subsidiary or of any
Subsidiary of a bank holding company of which any Lender is a Subsidiary.

 

Section 5.17.          Solvency. Upon giving effect to the issuance of the
Notes, the execution of the Loan Documents by Borrower and each Guarantor and
the consummation of the transactions contemplated hereby, (i) Borrower and each
Guarantor will be solvent (as such term is used in applicable bankruptcy,
liquidation, receivership, insolvency or similar Laws), and the sum of
Borrower’s and each Guarantor’s absolute and contingent liabilities, including
the Obligations or guarantees thereof, shall not exceed the fair market value of
such Restricted Person’s assets, and (ii) Borrower’s and each Guarantor’s
capital should be adequate for the businesses in which such Restricted Person is
engaged and intends to be engaged. Neither Borrower nor any other Restricted
Person has incurred (whether under the Loan Documents or otherwise), nor does
any Restricted Person intend to incur or reasonably foreseeably believes that it
will incur, debts which will be beyond its ability to pay as such debts mature.

 

ARTICLE VI. - AFFIRMATIVE COVENANTS

 

To conform with the terms and conditions under which each Lender is willing to
have credit outstanding to Borrower, and to induce each Lender to enter into
this Agreement and extend credit hereunder, Borrower covenants and agrees that
until the full and final payment of the Obligations and the termination of this
Agreement, unless Majority Lenders, or all Lenders as required under Section
10.1, have previously agreed otherwise:

 

Section 6.1.            Payment and Performance. Each Restricted Person will pay
all amounts due from it pursuant to the provisions of the Loan Documents to
which it is a party in accordance with the terms thereof and will observe,
perform and comply with every covenant, term and condition imposed on it
pursuant to the provisions of such Loan Documents.

 

Section 6.2.            Books, Financial Statements and Reports. Each Restricted
Person will at all times maintain full and accurate books of account and
records. Borrower will maintain and will cause its Subsidiaries to maintain a
standard system of accounting, will maintain its Fiscal Year, and will furnish
the following statements and reports to each Lender at Borrower’s expense:

 

(a)           Promptly upon the filing thereof, and in any event within ninety
(90) days after the end of each Fiscal Year, a copy of Borrower’s Form 10-K,
which report shall include Borrower’s complete Consolidated financial statements
together with all notes thereto, prepared in reasonable detail in accordance
with GAAP, together with an opinion, without material qualification, based on an
audit using generally accepted auditing standards, by PricewaterhouseCoopers
LLP, or other independent certified public accountants selected by

 

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General Partner, stating that such Consolidated financial statements have been
so prepared. These financial statements shall contain a Consolidated balance
sheet as of the end of such Fiscal Year and Consolidated statements of earnings
for such Fiscal Year. Such Consolidated financial statements shall set forth in
comparative form the corresponding figures for the preceding Fiscal Year.

 

(b)           Promptly upon the filing thereof, and in any event within sixty
(60) days after the end of each of the first three Fiscal Quarters of each
Fiscal Year, a copy of Borrower’s Form 10-Q, which report shall include
Borrower’s unaudited Consolidated balance sheet as of the end of such Fiscal
Quarter and Consolidated statements of Borrower’s earnings and cash flows for
such Fiscal Quarter and for the period from the beginning of the then current
Fiscal Year to the end of such Fiscal Quarter. In addition Borrower will,
together with each such set of financial statements and each set of financial
statements furnished under subsection (a) of this section, furnish a certificate
in the form of Exhibit D signed by the chief financial officer, principal
accounting officer or treasurer of General Partner stating that such financial
statements are accurate and complete in all material respects (subject to normal
year-end adjustments), stating that he has reviewed the Loan Documents,
containing calculations showing compliance (or non-compliance) at the end of
such Fiscal Quarter with the requirements of Section 7.8, stating that, to the
best of his knowledge, no Default exists at the end of such Fiscal Quarter or at
the time of such certificate or specifying the nature and period of existence of
any such Default, and identifying any Subsidiary designated as an Unrestricted
Subsidiary since the date of the most-recently delivered prior certificate under
this Section 6.2(b).

 

(c)           Promptly upon their becoming available, copies of all Form 8-K’s
filed by Borrower with any securities exchange, the Securities and Exchange
Commission or any similar governmental authority.

 

(d)           Promptly upon their becoming available, copies of all financial
statements, reports, notices and proxy statements sent by Borrower to its unit
holders and all registration statements filed by Borrower with any securities
exchange, the Securities and Exchange Commission or any similar governmental
authority.

 

(e)           Prompt notice of any publicly announced change in PAA’s Debt
Rating by either Standard & Poor’s or Moody’s.

 

Documents required to be delivered pursuant to Section 6.2(a), (b), (c) or (d),
(to the extent any such documents are included in materials otherwise filed with
the Securities and Exchange Commission) may be delivered electronically and if
so delivered, shall be deemed to have been delivered on the date on which
Borrower posts such documents, or provides a link thereto, on Borrower’s website
on the Internet at the website address listed on Schedule 10.3, and notifies
Administrative Agent of such posting or link.

 

Section 6.3.            Other Information and Inspections. In each case subject
to the last sentence of this Section 6.3, each Restricted Person will furnish to
Administrative Agent any information which Administrative Agent or any Lender
may from time to time reasonably request concerning any covenant, provision or
condition of the Loan Documents or any matter in connection with any Restricted
Person’s businesses and operations. In each case subject to the

 

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last sentence of this Section 6.3, each Restricted Person will permit
representatives appointed by Administrative Agent (including independent
accountants, auditors, agents, attorneys, appraisers and any other Persons),
upon reasonable prior notice, to visit and inspect during normal business hours
any of such Restricted Person’s property, including its books of account, other
books and records, and any facilities or other business assets, and to make
extra copies therefrom and photocopies and photographs thereof, and to write
down and record any information such representatives obtain, and each Restricted
Person shall permit Administrative Agent or its representatives to investigate
and verify the accuracy of the information furnished to Administrative Agent or
any Lender in connection with the Loan Documents and to discuss all such matters
with its officers, employees and, upon reasonable prior notice to Borrower, its
representatives. Each of the foregoing inspections and examinations shall be
made subject to compliance with applicable safety standards and the same
conditions applicable to any Restricted Person in respect of property of that
Restricted Person on the premises of Persons other than a Restricted Person or
an Affiliate of a Restricted Person, and all information, books and records
furnished or requested to be made, all information to be investigated or
verified and all discussion conducted with any officer, employee or
representative of any Restricted Person shall be subject to any applicable
attorney-client privilege exceptions which the Restricted Person determines is
reasonably necessary and compliance with conditions to disclosures under
non-disclosure agreements between any Restricted Person and Persons other than a
Restricted Person or an Affiliate of a Restricted Person and the express
undertaking of each Person acting at the direction of or on behalf of any Lender
Party to be bound by the confidentiality provisions of Section 10.6 of this
Agreement.

 

Borrower hereby acknowledges that (a) Administrative Agent will make available
to the Lenders materials and/or information provided by or on behalf of Borrower
hereunder (collectively, “Borrower Materials”) by posting Borrower Materials on
IntraLinks or another similar electronic system (the “Platform”) and (b) certain
of the Lenders may be “public-side” Lenders (i.e., Lenders that do not wish to
receive material non-public information with respect to Borrower or its
securities) (each, a “Public Lender”). If Borrower clearly, conspicuously and
prominently marks the front page of any Borrower Materials furnished by it with
the term “PUBLIC”, then (x) Borrower shall be deemed to have authorized
Administrative Agent and the Lenders to treat such Borrower Materials as either
publicly available information or not material information (although it may be
sensitive and proprietary) with respect to Borrower or its securities for
purposes of United States Federal and state securities laws; (y) all Borrower
Materials so marked “PUBLIC” are permitted to be made available through a
portion of the Platform designated “Public Investor;” and (z) Administrative
Agent shall be entitled to treat any Borrower Materials that are not marked
“PUBLIC” as being suitable only for posting on a portion of the Platform not
designated “Public Investor.”

 

Section 6.4.            Notice of Material Events. Borrower will notify each
Lender Party, not later than five (5) Business Days after any executive officer
of Borrower has knowledge thereof, stating that such notice is being given
pursuant to this Agreement, of:

 

(a)           the (i) occurrence of any Material Adverse Change or (ii)
occurrence of any event or condition that is covered by any of Section 5.6
(next-to-last sentence), 5.7 (last sentence), 5.9, 5.10, 5.11 or 5.12 which
would reasonable be expected to cause a Material Adverse Change,

 

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(b)           the occurrence of any Default,

 

(c)           the acceleration of the maturity of any Indebtedness owed by any
Restricted Person or of any default by any Restricted Person under any
indenture, mortgage, agreement, contract or other instrument to which any of
them is a party or by which any of them or any of their properties is bound, if
such acceleration or default would reasonably be expected to cause a Material
Adverse Change,

 

(d)           the occurrence of any Termination Event,

 

(e)           any claim under any Environmental Law adverse to a Restricted
Person or of potential liability with respect to such claim, or any other
adverse claim asserted against any Restricted Person or with respect to any
Restricted Person’s properties taken as a whole, in each case, which claim would
reasonably be expected to cause a Material Adverse Change, and

 

(f)            the filing of any suit or proceeding, or the assertion in writing
of a claim against any Restricted Person or with respect to any Restricted
Person’s properties, which would reasonably be expected to cause a Material
Adverse Change.

 

Upon the occurrence of any of the foregoing the applicable Restricted Person
will take all necessary or appropriate steps to remedy promptly, if applicable,
any such Material Adverse Change, Default, acceleration, default or Termination
Event, to protect against any such adverse claim, to defend any such claim, suit
or proceeding, and to resolve all controversies on account of any of the
foregoing.

 

Section 6.5.            Maintenance of Existence, Qualifications and Assets.
Each Significant Restricted Person (i) will maintain and preserve its existence
and its rights (including permits, licenses and other authorizations required
under Environmental Laws) and franchises in full force and effect, (ii) will
qualify to do business in all states or jurisdictions where required by
applicable Law, and (iii) keep all of its material assets that are useful in and
necessary to its business in good working order and condition (ordinary wear and
tear and obsoleteness excepted) except, in each case (a) where the failure so to
maintain, preserve, qualify or keep would not be reasonably expected to cause a
Material Adverse Change, (b) as permitted in Section 7.3 or as a result of
statutory conversions or (c) as a result of a release permitted pursuant to
Section 6.9. Borrower will notify Administrative Agent in writing of any changes
in its or any other Significant Restricted Person’s name or the location of its
or any other Significant Restricted Person’s chief executive office or principal
place of business.

 

Section 6.6.            Payment of Taxes, etc. Each Significant Restricted
Person will (a) timely file all required tax returns (including any extensions),
(b) timely pay all taxes, assessments, and other governmental charges or levies
imposed upon it or upon its income, profits or property, and (c) maintain
appropriate accruals and reserves for all of the foregoing as required by GAAP,
except to the extent that (y) it is in good faith contesting the validity
thereof by appropriate proceedings, if necessary, and has set aside on its books
adequate reserves therefor which are required by GAAP or (z) such non-filing,
non-payment or non-maintenance would not reasonably be expected to cause a
Material Adverse Change.

 

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Section 6.7.            Insurance. In accordance with industry standards, each
Significant Restricted Person will keep insured (by responsible and reputable
insurance companies or associations) or self-insured, at the option of Borrower
or such Significant Restricted Person, in such amounts and against such risks as
are usually insured by Persons engaged in the same or similar businesses and
owning similar properties. The insurance coverages and amounts will be
reasonably determined by Borrower, based on coverages carried by prudent owners
of similar property, and with respect to each Restricted Person, may be
maintained by Borrower.

 

Section 6.8.            Compliance with Agreements and Law. Each Significant
Restricted Person will perform all material obligations it is required to
perform under the terms of each indenture, mortgage, deed of trust, security
agreement, lease, franchise and other material agreement, contract or other
instrument (including all contractual obligations and agreements with respect to
environmental remediation or other environmental matters) to which it is a party
or by which it or any of its properties is bound to the extent that
non-performance therewith would not reasonably be expected to cause a Material
Adverse Change. Each Restricted Person will conduct its business and affairs in
compliance, in all material respects, with all Laws (including Environmental
Laws) applicable thereto to the extent non-compliance therewith would not
reasonably be expected to cause a Material Adverse Change or such requirement of
Law is being contested in good faith or a bona fide dispute exists with respect
thereto.

 

Section 6.9.            Guaranties of Subsidiaries. Each Significant Restricted
Person that has outstanding Indebtedness (other than guarantees hereunder),
other than a Significant Restricted Person with assets that are regulated by the
California Public Utility Commission (the “CPUC”) or other similar regulatory
body and such Significant Restricted Person is restricted by the CPUC or such
body from providing any guaranties of Indebtedness, shall execute and deliver to
Administrative Agent an absolute and unconditional guaranty of the timely
repayment of the Obligations (in each case for which such Person is not a
borrower, account party or similar primary and direct obligor), which guaranty
shall be reasonably satisfactory to Administrative Agent in form and substance;
provided, with respect to any such Person that is not a Wholly Owned Subsidiary
of Borrower, for which consent or approval of third parties is required for the
delivery of such guaranty, such Person shall not be required to deliver such
guaranty, but shall use its commercially reasonable best efforts, as determined
by Administrative Agent, to deliver such guaranty. Notwithstanding any provision
contained herein to the contrary, in no event shall any Unrestricted Subsidiary
be required to execute and deliver any guaranty for, or in respect of, the
Obligations, or any part thereof. Borrower will cause each of its Subsidiaries
required to deliver a guaranty pursuant to this Section 6.9 to deliver to
Administrative Agent, simultaneously with its delivery of such a guaranty,
written evidence satisfactory to Administrative Agent that such Subsidiary has
taken all corporate, limited liability company or partnership action necessary
to duly approve and authorize its execution, delivery and performance of such
guaranty. Borrower may at any time request the release of one or more Guarantors
from their guaranty of the Obligations, and each such Guarantor shall be so
released upon such request, provided, no Default exists immediately prior
thereto or immediately after giving effect thereto, and either (a) such
Guarantor has no outstanding Indebtedness or guaranties of Indebtedness (other
than guaranties hereunder) or (b) the request is in contemplation of the sale or
disposition of such Subsidiary (including all or substantially all of its
assets). Administrative Agent is authorized to execute and deliver to Borrower
evidence of any such release, as reasonably requested by, and at the expense of,
Borrower.

 

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ARTICLE VII. - NEGATIVE COVENANTS

 

To conform with the terms and conditions under which each Lender is willing to
have credit outstanding to Borrower and to induce each Lender to enter into this
Agreement and make the Loans, Borrower covenants and agrees that until the full
and final payment of the Obligations and the termination of this Agreement,
unless Majority Lenders, or all Lenders as required under Section 10.1, have
previously agreed otherwise:

 

Section 7.1.            Subsidiary Indebtedness. No Subsidiary of Borrower will
incur any Indebtedness other than:

 

(a)           the Obligations;

 

(b)           Guaranties by Guarantors of, and the incurrence of obligations by
Guarantors as a co-obligor on (as distinguished from, and in addition to
incurring such obligation as, a guarantor of), Indebtedness (i) arising under
the US/Canada Credit Agreement, or (ii) of Borrower or any other Restricted
Person, the incurrence of which did not result in a Default or an Event of
Default;

 

(c)           Indebtedness of (i) PMC (Nova Scotia) Company and Plains Marketing
Canada, L.P. pursuant to the US/Canada Credit Agreement, and (ii) Plains
Marketing pursuant to the Contango Credit Agreement;

 

(d)           Indebtedness of any Restricted Person owing to another Restricted
Person;

 

(e)           Indebtedness of any Subsidiary described in clause (b) of the
definition of “Indebtedness” that is determinable but not yet earned; provided,
Borrower reasonably contemplates that such Indebtedness will be repaid from the
proceeds of one or more advances made by Borrower to such Subsidiary;

 

(f)            Indebtedness of a Subsidiary acquired (including acquisition by
merger, consolidation or amalgamation) after the date hereof by a Restricted
Person, which Indebtedness was incurred by such Subsidiary before the time of
such acquisition, merger, consolidation or amalgamation, and was not created in
contemplation thereof; provided, that contemporaneously with such acquisition,
merger, consolidation or amalgamation, and so long as no adverse tax and/or
regulatory consequences are caused thereby, such Subsidiary shall be a Guarantor
subject to the provisions of Section 6.9; and

 

(g)           Indebtedness not otherwise described in the foregoing clauses (a)
through (f) owing by any one or more Guarantors in an aggregate principal amount
not to exceed at any time outstanding the greater of (A) $100,000,000 and
(B) fifteen percent (15%) of Consolidated Tangible Net Worth.

 

Section 7.2.            Limitation on Liens. No Restricted Person will create,
assume or permit to exist any Lien upon any Principal Property or upon the
stock, membership interests, partnership interests or other equity ownership
interests of any Subsidiary of Borrower (other than Unrestricted Subsidiaries),
except the following (“Permitted Liens”):

 

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(a)           Liens securing (i) on a pari passu basis, both (x) the Obligations
and (y) the Liabilities of any Restricted Person arising under the US/Canada
Credit Agreement, and (ii) if required, any related interest hedge rate
agreements;

 

(b)           Intentionally deleted;

 

(c)           Liens imposed by any governmental authority for taxes, assessments
or charges not yet due or the validity of which is being contested in good faith
and by appropriate proceedings, if necessary, for which adequate reserves are
maintained on the books of any Restricted Person in accordance with GAAP;

 

(d)           pledges or deposits of cash or securities under worker’s
compensation, unemployment insurance or other social security legislation;

 

(e)           carriers’, warehousemen’s, mechanics’, materialmen’s, repairmen’s,
landlord’s, or other like Liens (including without limitation, Liens on property
of any Restricted Person in the possession of storage facilities, pipelines or
barges) arising in the ordinary course of business for amounts which are not
more than 60 days past due or the validity of which is being contested in good
faith and, if necessary, by appropriate proceedings, and for which adequate
reserves are maintained on the books of any Restricted Person in accordance with
GAAP;

 

(f)            Liens on cash and Cash Equivalents under or with respect to
accounts with brokers or counterparties with respect to hedging contracts
consisting of cash, commodities or futures contracts, options, securities,
instruments, and other like assets securing only hedging contracts;

 

(g)           deposits of cash or securities to secure the performance of bids,
trade contracts (other than for borrowed money), leases, statutory obligations,
surety and appeal bonds, performance bonds and other obligations of a like
nature incurred in the ordinary course of business;

 

(h)           easements, rights-of-way, restrictions and other similar
encumbrances incurred in the ordinary course of business and encumbrances
consisting of zoning restrictions, easements, licenses, restrictions on the use
of real property or minor imperfections in title thereto which, in the
aggregate, are not material in amount, and which do not in any case materially
detract from the value of the property subject thereto or interfere with the
ordinary conduct of the business of any Restricted Person;

 

(i)            Liens in respect of operating leases;

 

(j)            Liens upon any property or assets directly or indirectly acquired
after the date hereof by a Restricted Person, each of which either (i) existed
on such property or asset before the time of its acquisition and was not created
in anticipation thereof, or (ii) was created solely for the purpose of securing
Indebtedness representing, or incurred to finance, refinance or refund, the cost
(including the cost of construction) of such property or asset; provided that no
such Lien shall extend to or cover any property or asset of a Restricted Person
other than the property or asset so acquired (or constructed); and any
extension, renewal, refinancing, refunding or replacement (or successive
extensions, renewals, refinancings, refundings or replacements), in

 

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whole or part, of the foregoing, provided, however, that such Liens shall not
cover or secure any additional Indebtedness, obligations, property or asset;

 

(k)           rights reserved to or vested in any governmental authority by the
terms of any right, power, franchise, grant, license or permit, or by any
provision of law, to revoke or terminate any such right, power, franchise,
grant, license or permit or to condemn or acquire by eminent domain or similar
process;

 

(l)            rights reserved to or vested by Law in any governmental authority
to in any manner, control or regulate in any manner any of the properties of any
Restricted Person or the use thereof or the rights and interests of any
Restricted Person therein, in any manner under any and all Laws;

 

(m)          rights reserved to the grantors of any properties of any Restricted
Person, and the restrictions, conditions, restrictive covenants and limitations,
in respect thereto, pursuant to the terms, conditions and provisions of any
rights-of-way agreements, contracts or other agreements therewith;

 

(n)           inchoate Liens in respect of pending litigation or with respect to
a judgment which has not resulted in an Event of Default under Section 8.1;

 

(o)           Liens securing obligations in an aggregate principal amount not to
exceed at any time outstanding 10% of Borrower’s Consolidated Tangible Net
Worth; and

 

(p)           Liens related to the extension, renewal, refinancing, refunding or
replacement (or successive extensions, renewals, refinancings, refundings or
replacements), in whole or in part, of clauses (a), (b) and (o) of this Section
7.2; provided, however, that such Liens shall not cover or secure any additional
Indebtedness.

 

Section 7.3.            Limitation on Mergers. Except as expressly provided in
this section, no Significant Restricted Person (other than (i) a Guarantor for
whom a release has been requested pursuant to an event described in clause (b)
of Section 6.9 and otherwise is so released, or (ii) such other Significant
Restricted Person, other than Borrower, that is the subject of any such event
described in such clause (b) of Section 6.9) will (a) merge or consolidate or
amalgamate with any Person, or liquidate, wind up or dissolve or (b) sell,
transfer, lease, exchange or otherwise dispose of, in one transaction or a
series of related transactions, all or substantially all of its business or
property, whether now owned or hereafter acquired, to any Person; provided, any
such Significant Restricted Person, other than Borrower, may (A) merge into or
consolidate or amalgamate with, and such business and property may be disposed
of to:

 

(i)            any other Subsidiary of Borrower; provided, if such Significant
Restricted Person or such Subsidiary is a Guarantor, a Guarantor is the
surviving or transferee (as applicable) business entity,

 

(ii)           Borrower, so long as Borrower is the surviving or transferee (as
applicable) business entity and after giving effect thereto, no Default exists,
or

 

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(iii)          any other Person pursuant or incidental to, or in connection
with, any contemporaneous or substantially contemporaneous acquisition, provided
that for purposes of this clause (iii) such merging, amalgamating, consolidating
or transferor Significant Restricted Person is not Borrower, Guarantor or a
Wholly Owned Subsidiary of Borrower, other than a Wholly Owned Subsidiary that
was formed, acquired or created solely for purposes of such acquisition or
otherwise conducted no operations and owned no assets, other than of an
inconsequential amount and

 

(B) dissolve, liquidate or wind up if such dissolution, liquidation and winding
up results from dispositions not prohibited by this Agreement.

 

Section 7.4.            Limitation on New Businesses. No Restricted Person will
materially or substantially engage directly or indirectly in any business or
conduct any operations other than (i) marketing, gathering, transporting (by
barge, pipeline, ship, truck or other modes of hydrocarbon transportation),
terminalling, storing, producing, acquiring, developing, exploring for,
exploiting, producing, processing, dehydrating and otherwise handling
hydrocarbons, including, without limitation, constructing pipeline, platform,
dehydration, processing and other energy-related facilities, (ii) any other
business that generates gross income that constitutes “qualifying income” under
Section 7704(d) of the Internal Revenue Code of 1986, as amended, or (iii)
activities or services reasonably related or ancillary thereto, including
entering into hedging obligations to support those businesses.

 

Section 7.5.            Transactions with Affiliates. No Restricted Person will
engage in any material transaction with any of its Affiliates except as follows:
(a) transactions among Borrower and its Subsidiaries or between Subsidiaries of
Borrower; (b) if and to the extent any of them constitute transactions with
Affiliates, transactions governed by the Amended and Restated Omnibus Agreement
between Plains Resources Inc., Borrower, Plains Marketing, GP LLC, Plains
Marketing GP, Inc. and Plains Pipeline (and successors of each) dated July 23,
2004, as amended and in effect; the Administrative Services Agreement between GP
LLC and Vulcan Energy Company dated October 14, 2005, as amended and in effect;
the Amended and Restated Limited Liability Company Agreement of PAA/Vulcan
Natural Gas Storage, LLC, dated as of September 16, 2005, and amended by the
First Amendment thereto dated as of May 9, 2006, as further amended and in
effect; the Natural Gas Supply Agreement between Borrower and PAA/Vulcan Natural
Gas Storage, LLC dated as of May 9, 2006, as amended and in effect; or the
Amended and Restated Crude Oil Marketing Agreement among Plains Resources Inc.,
Calumet Florida, LLC and Plains Marketing dated as of July 23, 2004, as amended;
(c) any employment, equity award, equity option or equity appreciation agreement
or plan entered into by Borrower or any of its Subsidiaries in the ordinary
course of business of Borrower or such Subsidiary; (d) transactions effected in
accordance with the terms of agreements as in effect on the Closing Date; (e)
customary compensation, indemnification and other benefits made available to
officers, directors or employees of Borrower, any of its Subsidiaries or GP LLC,
including reimbursement or advancement of out-of-pocket expenses and provisions
of officers’ and directors’ liability insurance; (f) transactions as
contemplated by Borrower’s agreement of limited partnership; and (g)
transactions on terms which are no less favorable to such Restricted Person than
those which would have been obtainable at the time in arm’s-length transactions
with Persons other than such Affiliates.

 

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Section 7.6.            Limitation on Distributions. Borrower shall not declare
or pay any Distribution so long as any Default or Event of Default has occurred
and is continuing or would result therefrom.

 

Section 7.7.            Restricted Contracts. Except as expressly provided for
in the Loan Documents, the US/Canada Credit Agreement and as described in the
Disclosure Schedule or pursuant to a Restriction Exception, the substance of
which, in detail satisfactory to Administrative Agent, is promptly reported to
Administrative Agent, no Restricted Person will, directly or indirectly, enter
into, create, or otherwise allow to exist any contract or other consensual
restriction on the ability of any Subsidiary of Borrower, including but not
limited to PMC (Nova Scotia) Company, Plains Marketing Canada, L.P. and any
Subsidiary of such Persons to:  (a) pay dividends or make other distributions to
Borrower, (b) redeem equity interests held in it by Borrower, (c) repay loans
and other indebtedness owing by it to Borrower, or (d) transfer any of its
assets to Borrower.

 

Section 7.8.            Debt Coverage Ratio. At the end of any Fiscal Quarter,
the Debt Coverage Ratio will not be greater than the amount set forth below for
the applicable time set forth below:

 

(i)            During an Acquisition Period:                           5.25 to
1.0

 

(ii)           Other than an Acquisition Period:                    4.75 to 1.0

 

As used herein, “Debt Coverage Ratio” means the ratio of (a) Consolidated Funded
Indebtedness to (b) Consolidated EBITDA, for the four Fiscal Quarter period (or
other period specified below) most recently ended prior to the date of
determination for which financial statements contemplated by Section 6.2(a) or
(b) are available to Borrower; provided, for purposes of this Section 7.8, if,
since the beginning of the four Fiscal Quarter period ending on the date for
which Consolidated EBITDA is determined, any Restricted Person shall have made
any asset disposition or acquisition, shall have consolidated or merged with or
into any Person (other than another Restricted Person), or shall have made any
disposition or acquisition of a Restricted Person or disposition or acquisition
of any partial ownership interest in any other Person, Consolidated EBITDA shall
be calculated giving pro forma effect thereto as if the disposition,
acquisition, consolidation or merger had occurred on the first day of such
period; provided, with respect to any Person not constituting a Subsidiary of
Borrower, such pro forma calculation of Consolidated EBITDA, with respect to any
such Person, shall be limited to not more than 75% of (i) such Restricted
Person’s ownership interest in such Person times (ii) the difference of such
Person’s (A) Consolidated EBITDA minus (B) Interest Expense and capital
expenditures. Such pro forma calculations shall be determined (i) in good faith
by the chief financial officer of Borrower, and (ii) without giving effect to
any anticipated or proposed change in operations, revenues, expenses or other
items included in the computation of Consolidated EBITDA, except cost reductions
specifically identified at the time of disposition, acquisition, consolidation
or merger that are attributable to personnel reductions, non-recurring
maintenance and environmental costs and allocated corporate overhead; provided
further, Consolidated EBITDA may include, at Borrower’s option, any Material
Project EBITDA Adjustments as provided below.

 

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As used herein, “Material Project EBITDA Adjustments” means, with respect to the
construction or expansion of any capital project of Borrower or any of its
Consolidated Subsidiaries (excluding Unrestricted Subsidiaries), the aggregate
capital cost of which (inclusive of capital costs expended prior to the
acquisition thereof) is reasonably expected by Borrower to exceed, or exceeds,
$50,000,000 (a “Material Project”):

 

(A) prior to the date on which a Material Project has achieved commercial
operation (the “Commercial Operation Date”) (but including the fiscal quarter in
which such Commercial Operation Date occurs), a percentage (based on the
then-current completion percentage of such Material Project) of an amount to be
approved by Administrative Agent as the projected Consolidated EBITDA
attributable to such Material Project for the first 12-month period following
the scheduled Commercial Operation Date of such Material Project (such amount to
be determined based on customer contracts or tariff-based customers relating to
such Material Project, the creditworthiness of the other parties to such
contracts or such tariff-based customers, and projected revenues from such
contracts, tariffs, capital costs and expenses, scheduled Commercial Operation
Date, oil and gas reserve and production estimates, commodity price assumptions
and other factors deemed appropriate by Administrative Agent), which may, at
Borrower’s option, be added to actual Consolidated EBITDA for the fiscal quarter
in which construction or expansion of such Material Project commences and for
each fiscal quarter thereafter until the Commercial Operation Date of such
Material Project (including the fiscal quarter in which such Commercial
Operation Date occurs, but net of any actual Consolidated EBITDA attributable to
such Material Project following such Commercial Operation Date); provided that
if the actual Commercial Operation Date does not occur by the scheduled
Commercial Operation Date, then the foregoing amount shall be reduced, for
quarters ending after the scheduled Commercial Operation Date to (but excluding)
the first full quarter after its Commercial Operation Date, by the following
percentage amounts depending on the period of delay (based on the period of
actual delay or then-estimated delay, whichever is longer): (i) 90 days or less,
0%, (ii) longer than 90 days, but not more than 180 days, 25%, (iii) longer than
180 days but not more than 270 days, 50%, (iv) longer than 270 days but not more
than 365 days, 75%, and (v) longer than 365 days, 100%; and

 

(B) beginning with the first full fiscal quarter following the Commercial
Operation Date of a Material Project and for the two immediately succeeding
fiscal quarters, an amount equal to the projected Consolidated EBITDA
attributable to such Material Project for the balance of the four full fiscal
quarter period following such Commercial Operation Date, which may, at
Borrower’s option, be added to actual Consolidated EBITDA for such fiscal
quarters.

 

Notwithstanding the foregoing:

 

(i) no such Material Project EBITDA Adjustment shall be allowed with respect to
any Material Project unless:

 

(a) at least 30 days prior to the last day of the Fiscal Quarter for which
Borrower desires to commence inclusion of such Material Project EBITDA

 

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Adjustment in Consolidated EBITDA with respect to a Material Project for
purposes of determining compliance with this Section 7.8 (the “Initial
Quarter”), Borrower shall have delivered to Administrative Agent written pro
forma projections of Consolidated EBITDA attributable to such Material Project
and

 

(b) prior to the last day of the Initial Quarter, Administrative Agent shall
have approved (such approval not to be unreasonably withheld) such projections
and shall have received such other information and documentation as
Administrative Agent may reasonably request, all in form and substance
satisfactory to Administrative Agent, and

 

(ii) the aggregate amount of all Material Project EBITDA Adjustments during any
period shall be limited to 15% of the total actual Consolidated EBITDA for such
period (which total actual Consolidated EBITDA shall be determined without
including any Material Project EBITDA Adjustments).

 

Section 7.9.            Intentionally Deleted.

 

Section 7.10           Unrestricted Subsidiaries. So long as no Default or Event
of Default has occurred and is continuing, and after giving effect to such
designation, no Default or Event of Default would result therefrom, Borrower or
any Wholly Owned Subsidiary of Borrower may designate one or more Subsidiaries
that are not Guarantors as unrestricted Subsidiaries (each such Subsidiary, and
each of its Subsidiaries, an “Unrestricted Subsidiary”), which Unrestricted
Subsidiaries shall be subject to the following:

 

(a)           No Unrestricted Subsidiary shall be deemed to be a “Restricted
Person” or a “Subsidiary” of Borrower for purposes of this Agreement or any
other Loan Document, and no Unrestricted Subsidiary shall be subject to or
included within the scope of any provision herein or in any other Loan Document,
including without limitation any representation, warranty, covenant or Event of
Default herein or in any other Loan Document, except as set forth in this
Section 7.10.

 

(b)           No Restricted Person shall guarantee or otherwise become liable in
respect of any Indebtedness of, grant any Lien on any of its property to secure
any Indebtedness of or other obligation of, or provide any other form of credit
support to, any Unrestricted Subsidiary, and no Restricted Person shall enter
into any contract or agreement with any Unrestricted Subsidiary, except on terms
no less favorable to such Restricted Person, as applicable, than could be
obtained in a comparable arm’s length transaction with a non-Affiliate of such
Restricted Person; provided, Restricted Persons may guarantee trade accounts
payable of Unrestricted Subsidiaries that arise in the ordinary course of
business in an amount not to exceed five percent (5%) of Consolidated Tangible
Net Worth.

 

(c)           Borrower shall at all times maintain, as between Restricted
Persons and Unrestricted Subsidiaries, the separate existence of each
Unrestricted Subsidiary.

 

(d)           Restricted Persons shall notify each Lender Party, not later than
five (5) Business Days after any executive officer of Restricted Persons has
knowledge of, any claim, including any claim under any

 

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Environmental Law, or any notice of potential liability under any Environmental
Law, asserted against any Unrestricted Subsidiary or with respect to any
Unrestricted Subsidiary’s properties that would reasonably be expected to result
in a Material Adverse Change, stating that such notice is being given pursuant
to this Section 7.10.

 

Borrower may designate any Unrestricted Subsidiary to become a Restricted Person
if a Default or Event of Default is not continuing, such designation would not
result in a Default or an Event of Default, and immediately thereafter such
Subsidiary has no outstanding Indebtedness. Immediately thereafter, Borrower
shall promptly notify Administrative Agent of such designation and provide to it
an officer’s certificate that such designation was made in compliance with this
Section 7.10.

 

Section 7.11           No Negative Pledges. Except as described in the
Disclosure Schedule or pursuant to a Restriction Exception, the substance of
which, in detail satisfactory to Administrative Agent, is promptly reported to
Administrative Agent, no Restricted Person will, directly or indirectly, enter
into, create, or consent to be bound to any contract or other consensual
restriction that restricts the ability of any Restricted Person to create or
maintain Liens on its assets in favor of Administrative Agent and Lenders to
secure, in whole or part, the Obligations.

 

ARTICLE VIII. - EVENTS OF DEFAULT AND REMEDIES

 

Section 8.1.            Events of Default. Each of the following events
constitutes an Event of Default under this Agreement:

 

(a)           Borrower fails to pay the principal component of any Loan made to
it when due and payable, whether at a date for the payment of a fixed
installment or as a contingent or other payment becomes due and payable or as a
result of acceleration or otherwise,

 

(b)           Any Restricted Person fails to pay any Obligation for which it is
contractually liable (other than the Obligations in subsection (a) above) when
due and payable, whether at a date for the payment of a fixed installment or as
a contingent or other payment becomes due and payable or as a result of
acceleration or otherwise, within three Business Days after the same becomes
due;

 

(c)           Any Restricted Person fails to duly observe, perform or comply
with any covenant, agreement or provision of Section 6.4 or Article VII;

 

(d)           Any Restricted Person fails (other than as referred to in
subsections (a), (b) or (c) above) to duly observe, perform or comply with any
of its obligations under any covenant, agreement, condition or provision of any
Loan Document to which it is a party, and such failure remains unremedied for a
period of thirty (30) days after notice of such failure is given by
Administrative Agent to Borrower;

 

(e)           Any representation or warranty previously, presently or hereafter
made in writing by or on behalf of any Restricted Person in connection with any
Loan Document shall prove to have been false or incorrect in any material
respect on any date on or as of which made, or any Loan Document at any time
ceases to be valid, binding and enforceable as warranted in Section 5.5 for any
reason other than its release or subordination by Administrative Agent;

 

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(f)            Any Restricted Person shall default in the payment when due of
any principal of or interest on any of its other Indebtedness, or any net
hedging obligations, in excess of the Dollar Equivalent of $25,000,000 in the
aggregate (other than such Indebtedness or hedging obligations the validity of
which is being contested in good faith, by appropriate proceedings (if
necessary) and for which adequate reserves with respect thereto are maintained
on the books of such Restricted Person as required by GAAP), or any event
specified in any note, agreement, indenture or other document evidencing or
relating to any such Indebtedness or hedging obligations shall occur for a
period beyond the applicable grace, cure extension, forbearance or other similar
period, if the effect of such event is to cause, or (with the giving of any
notice or the lapse of time or both) to permit the holder or holders of such
Indebtedness or hedging obligations (or a trustee or agent on behalf of such
holder or holders) to cause, as applicable, such Indebtedness to become due, or
to be prepaid in full (whether by redemption, purchase, offer to purchase or
otherwise), prior to its stated maturity, or an early termination event or
similar event to occur and such Restricted Person’s related net hedging
obligations in excess of the Dollar Equivalent of $25,000,000 to become due and
payable;

 

(g)           Either (i) any “accumulated funding deficiency” (as defined in
Section  412(a) of the Code) in excess of $5,000,000 exists with respect to any
ERISA Plan, whether or not waived by the Secretary of the Treasury or his
delegate, or (ii) any Termination Event occurs with respect to any ERISA Plan
and the then current value of such ERISA Plan’s benefit liabilities exceeds the
then current value of such ERISA Plan’s assets available for the payment of such
benefit liabilities by more than $5,000,000 (or in the case of a Termination
Event involving the withdrawal of a substantial employer, the withdrawing
employer’s proportionate share of such excess exceeds such amount);

 

(h)           GP LLC, General Partner, or any Significant Restricted Person:

 

(i)            has entered against it a judgment, decree or order for relief by
a Governmental Authority of competent jurisdiction having jurisdiction over it
in an involuntary proceeding commenced under any applicable bankruptcy,
insolvency or other similar Law of any jurisdiction now or hereafter in effect,
including the federal Bankruptcy Code, the Bankruptcy and Insolvency Act
(Canada) or the Companies’ Creditors Arrangement Act (Canada), as from time to
time amended, or has any such proceeding commenced against it, in each case,
which remains undismissed for a period of sixty days; or

 

(ii)           commences a voluntary case under any applicable bankruptcy,
insolvency or similar Law now or hereafter in effect, including the federal
Bankruptcy Code, the Bankruptcy and Insolvency Act (Canada) or the Companies’
Creditors Arrangement Act (Canada), as from time to time amended; or applies for
or consents to the entry of an order for relief in an involuntary case under any
such Law; or makes a general assignment for the benefit of creditors; or is
generally unable to pay (or admits in writing its inability to so pay) its debts
as such debts become due; or takes corporate or other action to authorize any of
the foregoing; or

 

(iii)          has entered against it the appointment of or taking possession by
a receiver, liquidator, assignee, custodian, trustee, sequestrator or similar
official of all or a substantial part of its assets in a proceeding brought
against or initiated by it, and such appointment or taking possession is neither
made ineffective nor discharged within sixty days

 

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after the making thereof, or such appointment or taking possession is at any
time consented to, requested by, or acquiesced to by it; or

 

(i)            Any Significant Restricted Person:

 

(i)            has entered against it a final judgment for the payment of money
in excess of the Dollar Equivalent of $25,000,000 (in each case not covered by
insurance satisfactory to Administrative Agent in its discretion), unless the
same is stayed or discharged within thirty days after the date of entry thereof
(or longer period for which a stay of enforcement is allowed by applicable Law)
or an appeal or appropriate proceeding for review thereof is taken within such
period and a stay of execution pending such appeal is obtained; or

 

(ii)           suffers a writ or warrant of attachment or any similar process to
be issued by any Governmental Authority having jurisdiction over it against all
or any substantial part of its assets, and such writ or warrant of attachment or
any similar process is not stayed or released within sixty days after the entry
or levy thereof (or longer period for which a stay of enforcement is allowed by
applicable Law) or after any stay is vacated or set aside;

 

(j)            Any Change in Control occurs.

 

Upon the occurrence of an Event of Default described in subsection (h)(i),
(h)(ii) or (h)(iii) of this section with respect to Borrower, all of the
Obligations shall thereupon be immediately due and payable, without demand,
presentment, notice of demand or of dishonor and nonpayment, protest, notice of
protest, notice of intention to accelerate, declaration or notice of
acceleration, or any other notice or declaration of any kind, all of which are
hereby expressly waived by Borrower and each Restricted Person who at any time
ratifies or approves this Agreement. Upon any such acceleration, any obligation
of any Lender to make any further Loans shall be permanently terminated. During
the continuance of any other Event of Default, Administrative Agent at any time
and from time to time may (and upon written instructions from Majority Lenders,
Administrative Agent shall), without notice to Borrower or any other Restricted
Person, do either or both of the following:  (1) terminate or suspend any
obligation of Lenders to make Loans hereunder, and (2) declare any or all of the
Obligations immediately due and payable, and all such Obligations shall
thereupon be immediately due and payable, without demand, presentment, notice of
demand or of dishonor and nonpayment, protest, notice of protest, notice of
intention to accelerate, declaration or notice of acceleration, or any other
notice or declaration of any kind, all of which are hereby expressly waived by
Borrower and each Restricted Person who at any time ratifies or approves this
Agreement.

 

Section 8.2.            Remedies. If any Default shall occur and be continuing,
each Lender Party may protect and enforce its rights under the Loan Documents by
any appropriate proceedings, including proceedings for specific performance of
any covenant or agreement contained in any Loan Document, and each Lender Party
may enforce the payment of any Obligations due it or enforce any other legal or
equitable right which it may have. All rights, remedies and powers conferred
upon Lender Parties under the Loan Documents shall be deemed cumulative and not
exclusive of any other rights, remedies or powers available under the Loan
Documents or at Law or in equity.

 

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ARTICLE IX. – ADMINISTRATIVE AGENT

 

Section 9.1.            Appointment and Authority. Each of the Lenders hereby
irrevocably appoints JPMorgan Chase Bank, N.A. to act on its behalf as
Administrative Agent hereunder and under the other Loan Documents and authorizes
Administrative Agent to take such actions on its behalf and to exercise such
powers as are delegated to Administrative Agent by the terms hereof or thereof,
together with such actions and powers as are reasonably incidental thereto. The
provisions of this Article are solely for the benefit of Administrative Agent
and the Lenders, and neither Borrower nor any other Lender Party shall have
rights as a third party beneficiary of any of such provisions (other than the
right to reasonably approve a successor Administrative Agent under Section 9.6
or with respect to application of payments among Lenders as provided in Section
9.11).

 

Section 9.2.            Rights as a Lender. The Person serving as Administrative
Agent hereunder shall have the same rights and powers in its capacity as a
Lender as any other Lender and may exercise the same as though it were not
Administrative Agent and the term “Lender” or “Lenders” shall, unless otherwise
expressly indicated or unless the context otherwise requires, include the Person
serving as Administrative Agent hereunder in its individual capacity. Such
Person and its Affiliates may accept deposits from, lend money to, act as the
financial advisor or in any other advisory capacity for and generally engage in
any kind of business with Borrower or any Subsidiary or other Affiliate thereof
as if such Person were not Administrative Agent hereunder and without any duty
to account therefor to the Lenders.

 

Section 9.3.            Exculpatory Provisions. Administrative Agent shall have
no duties or obligations except those expressly set forth herein and in the
other Loan Documents. Without limiting the generality of the foregoing,
Administrative Agent:

 

(a)           shall not be subject to any fiduciary or other implied duties,
regardless of whether a Default has occurred and is continuing;

 

(b)           shall have no duty to take any discretionary action or exercise
any discretionary powers, except discretionary rights and powers expressly
contemplated hereby or by the other Loan Documents that Administrative Agent is
required to exercise as directed in writing by the Majority Lenders (or such
other number or percentage of the Lenders as shall be expressly provided for
herein or in the other Loan Documents), provided that Administrative Agent shall
not be required to take any action that, in its opinion or the opinion of its
counsel, may expose Administrative Agent to liability or that is contrary to any
Loan Document or applicable law; and

 

(c)           shall not, except as expressly set forth herein and in the other
Loan Documents, have any duty to disclose, nor shall it be liable for the
failure to disclose, any information relating to any of Borrower or any of its
Affiliates that is communicated to or obtained by the Person serving as
Administrative Agent or any of its Affiliates in any capacity.

 

Administrative Agent shall not be liable for any action taken or not taken by it
(i) with the consent or at the request of the Majority Lenders (or such other
number or percentage of the Lenders as shall be necessary, or as the relevant
shall believe in good faith shall be necessary, under the circumstances as
provided in Sections 10.1 and 8.2) or (ii) in the absence of its own

 

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gross negligence or willful misconduct. Administrative Agent shall not be deemed
to have knowledge of any Default unless and until notice describing such Default
is given to Administrative Agent by Borrower or a Lender.

 

Administrative Agent shall not be responsible for nor have any duty to ascertain
or inquire into (i) any statement, warranty or representation made in or in
connection with this Agreement or any other Loan Document, (ii) the contents of
any certificate, report or other document delivered hereunder or thereunder or
in connection herewith or therewith, (iii) the performance or observance of any
of the covenants, agreements or other terms or conditions set forth herein or
therein or the occurrence of any Default, (iv) the validity, enforceability,
effectiveness or genuineness of this Agreement, any other Loan Document or any
other agreement, instrument or document or (v) the satisfaction of any condition
set forth in Article IV or elsewhere herein, other than to confirm receipt of
items expressly required to be delivered to Administrative Agent.

 

Section 9.4.            Reliance by Administrative Agent. Administrative Agent
shall be entitled to rely upon, and shall not incur any liability for relying
upon, any notice, request, certificate, consent, statement, instrument, document
or other writing (including any electronic message, Internet or intranet website
posting or other distribution) believed by it to be genuine and to have been
signed, sent or otherwise authenticated by the proper Person. Administrative
Agent also may rely upon any statement made to it orally or by telephone and
believed by it to have been made by the proper Person, and shall not incur any
liability for relying thereon. In determining compliance with any condition
hereunder to the making of a Loan that by its terms must be fulfilled to the
satisfaction of a Lender, Administrative Agent may presume that such condition
is satisfactory to such Lender unless Administrative Agent shall have received
notice to the contrary from such Lender prior to the making of such Loan.
Administrative Agent may consult with legal counsel (who may be counsel for
Borrower), independent accountants and other experts selected by it, and shall
not be liable for any action taken or not taken by it in accordance with the
advice of any such counsel, accountants or experts.

 

Section 9.5.            Delegation of Duties. Administrative Agent may perform
any and all of its duties and exercise its rights and powers hereunder or under
any other Loan Document by or through any one or more sub-agents appointed by
Administrative Agent. Administrative Agent and any such sub-agent may perform
any and all of its duties and exercise its rights and powers by or through their
respective Related Parties. The exculpatory provisions of this Article shall
apply to any such sub-agent and to the Related Parties of Administrative Agent
and any such sub-agent, and shall apply to their respective activities in
connection with the syndication of the credit facilities provided for herein as
well as activities as Administrative Agent.

 

Section 9.6.            Resignation of Administrative Agent. Administrative
Agent may at any time give notice of its resignation to the Lenders and
Borrower, which notice shall set forth the proposed date of resignation. Upon
receipt of any such notice of resignation, the Majority Lenders shall have the
right to appoint a successor (subject to the approval of Borrower, unless a
Default has occurred and is continuing, which approval will not be unreasonably
withheld), which shall be a bank with an office in the United States, or an
Affiliate of any such bank with an office in the United States. If no such
successor shall have been so appointed by the Majority Lenders and shall have
accepted such appointment within 30 days after the retiring Agent gives

 

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notice of its resignation, then the retiring Administrative Agent may on behalf
of the Lenders, appoint a successor Administrative Agent meeting the
qualifications set forth above; provided that if Administrative Agent shall
notify Borrower and the Lenders that no qualifying Person has accepted such
appointment, then such resignation shall nonetheless become effective in
accordance with such notice and (1) the retiring Administrative Agent shall be
discharged from its duties and obligations hereunder and under the other Loan
Documents and (2) all payments, communications and determinations provided to be
made by, to or through Administrative Agent shall instead be made by or to each
Lender directly, until such time as the Majority Lenders appoint a successor
Administrative Agent as provided for above in this Section. Upon the acceptance
of a successor’s appointment as Administrative Agent hereunder, such successor
shall succeed to and become vested with all of the rights, powers, privileges
and duties of the retiring (or retired) Administrative Agent, and the retiring
Administrative Agent shall be discharged from all of its duties and obligations
hereunder or under the other Loan Documents (if not already discharged therefrom
as provided above in this Section). The fees payable by Borrower to a successor
Administrative Agent shall be the same as those payable to its predecessor
unless otherwise agreed between Borrower and such successor. After the retiring
Administrative Agent’s resignation hereunder and under the other Loan Documents,
the provisions of this Article and Section 10.4 shall continue in effect for the
benefit of such retiring Administrative Agent, its sub-agents and their
respective Related Parties in respect of any actions taken or omitted to be
taken by any of them while the retiring Administrative Agent was acting as
Administrative Agent.

 

Section 9.7.            Non-Reliance on Administrative Agent and Other Lenders.
Each Lender acknowledges that it has, independently and without reliance upon
Administrative Agent or any other Lender or any of their Related Parties and
based on such documents and information as it has deemed appropriate, made its
own credit analysis and decision to enter into this Agreement. Each Lender also
acknowledges that it will, independently and without reliance upon
Administrative Agent or any other Lender or any of their Related Parties and
based on such documents and information as it shall from time to time deem
appropriate, continue to make its own decisions in taking or not taking action
under or based upon this Agreement, any other Loan Document or any related
agreement or any document furnished hereunder or thereunder.

 

Section 9.8.            No Other Duties, Etc. Anything herein to the contrary
notwithstanding, neither Administrative Agent, Co-Syndication Agents nor the
Co-Documentation Agents listed on the cover page hereof shall have any powers,
duties or responsibilities under this Agreement or any of the other Loan
Documents, except in its capacity, as applicable, as Administrative Agent or a
Lender hereunder.

 

Section 9.9.            Guaranty Matters. The Lenders irrevocably authorize
Administrative Agent, at its option and in its discretion, to release any
Guarantor from its obligations under the Guaranty if such Person ceases to be a
Subsidiary as a result of a transaction permitted hereunder or as otherwise
expressly provided in any Loan Document.

 

Upon request by Administrative Agent at any time, the Majority Lenders will
confirm in writing Administrative Agent’s authority to release any Guarantor
from its obligations under the Guaranty pursuant to this Section 9.9.

 

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Section 9.10.          Indemnification. Each Lender agrees to indemnify
Administrative Agent (to the extent not reimbursed by Borrower within ten (10)
days after demand) from and against such Lender’s Percentage Share of any and
all liabilities, obligations, claims, losses, damages, penalties, fines,
actions, judgments, suits, settlements, costs, expenses or disbursements
(including reasonable fees of attorneys, accountants, experts and advisors) of
any kind or nature whatsoever (in this section collectively called “liabilities
and costs”) which to any extent (in whole or in part) may be imposed on,
incurred by, or asserted against Administrative Agent growing out of, resulting
from or in any other way associated with the Loan Documents and the transactions
and events (including the enforcement thereof) at any time associated therewith
or contemplated therein and Borrower’s use of loan proceeds (whether arising in
contract or in tort or otherwise and including any violation or noncompliance
with any Environmental Laws by any Person or any liabilities or duties of any
Person with respect to Hazardous Materials found in or released into the
environment).

 

THE FOREGOING INDEMNIFICATION SHALL APPLY WHETHER OR NOT SUCH LIABILITIES AND
COSTS ARE IN ANY WAY OR TO ANY EXTENT OWED, IN WHOLE OR IN PART, UNDER ANY CLAIM
OR THEORY OF STRICT LIABILITY OR CAUSED, IN WHOLE OR IN PART, BY ANY NEGLIGENT
ACT OR OMISSION OF ANY KIND BY ADMINISTRATIVE AGENT, provided only that no
Lender shall be obligated under this section to indemnify Administrative Agent
for that portion, if any, of any liabilities and costs which is proximately
caused by Administrative Agent’s own individual gross negligence or willful
misconduct, as determined in a final judgment. Cumulative of the foregoing, each
Lender agrees to reimburse Administrative Agent promptly upon demand for such
Lender’s Percentage Share of any costs and expenses to be paid to Administrative
Agent by Borrower under Section 10.4(a) to the extent that Administrative Agent
is not timely reimbursed for such expenses by such Persons as provided in such
section. As used in this section the term “Administrative Agent” shall refer not
only to the Persons designated as such in Section 1.1 but also to each director,
officer, agent, attorney, employee, representative and Affiliate of such Person.

 

Section 9.11.          Sharing of Set-Offs and Other Payments. Each Lender Party
agrees that if it shall, whether through the exercise of rights of banker’s
lien, set off, or counterclaim against Borrower or otherwise, obtain payment of
a portion of the aggregate Obligations owed to it which, taking into account all
distributions made by Administrative Agent under Section 3.1, causes such Lender
Party to have received more than it would have received had such payment been
received by Administrative Agent and distributed pursuant to Section 3.1, then
(a) it shall be deemed to have simultaneously purchased and shall be obligated
to purchase interests in the Obligations as necessary to cause all Lender
Parties to share all payments as provided for in Section 3.1, and (b) such other
adjustments shall be made from time to time as shall be equitable to ensure that
Administrative Agent and all Lender Parties share all payments of Obligations as
provided in Section 3.1; provided, however, and for the avoidance of doubt, that
nothing herein contained shall in any way affect the right of any Lender Party
to obtain payment (whether by exercise of rights of banker’s lien, set-off or
counterclaim or otherwise) of indebtedness other than the Obligations. Borrower
expressly consents to the foregoing arrangements, subject to Section 10.11. If
all or any part of any funds transferred pursuant to this section is thereafter
recovered from the seller under this section which received the same, the
purchase provided for in this section shall be deemed to have been rescinded to
the extent of such recovery, together

 

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with interest, if any, if interest is required pursuant to the order of a
Governmental Authority to be paid on account of the possession of such funds
prior to such recovery.

 

Section 9.12.          Investments. Whenever Administrative Agent in good faith
determines that it is uncertain about how to distribute to Lender Parties any
funds which it has received, or whenever Administrative Agent in good faith
determines that there is any dispute among Lender Parties about how such funds
should be distributed, Administrative Agent may choose to defer distribution of
the funds which are the subject of such uncertainty or dispute. If
Administrative Agent in good faith believes that the uncertainty or dispute will
not be promptly resolved, or if Administrative Agent is otherwise required to
invest funds pending distribution to Lender Parties, Administrative Agent shall
invest such funds pending distribution; all interest on any such Investment
shall be distributed upon the distribution of such Investment and in the same
proportion and to the same Persons as such Investment. All moneys received by
Administrative Agent for distribution to Lender Parties (other than to the
Person who is Administrative Agent in its separate capacity as a Lender Party)
shall be held by Administrative Agent pending such distribution solely as
Administrative Agent for such Lender Parties, and Administrative Agent shall
have no equitable title to any portion thereof.

 

ARTICLE X. – MISCELLANEOUS

 

Section 10.1.          Waivers and Amendments; Acknowledgments.

 

(a)           Waivers and Amendments. No failure or delay (whether by course of
conduct or otherwise) by any Lender in exercising any right, power or remedy
which such Lender Party may have under any of the Loan Documents shall operate
as a waiver thereof or of any other right, power or remedy, nor shall any single
or partial exercise by any Lender Party of any such right, power or remedy
preclude any other or further exercise thereof or of any other right, power or
remedy. No waiver of any provision of any Loan Document and no consent to any
departure therefrom shall ever be effective unless it is in writing and signed
as provided below in this section, and then such waiver or consent shall be
effective only in the specific instances and for the purposes for which given
and to the extent specified in such writing. This Agreement and the other Loan
Documents set forth the entire understanding between the parties hereto with
respect to the transactions contemplated herein and therein and supersede all
prior discussions and understandings with respect to the subject matter hereof
and thereof, and no amendment or waiver of any provision of this Agreement or
any other Loan Document, and no consent to any departure by Borrower or any
other Restricted Person therefrom, shall be effective unless in writing signed
by the Majority Lenders and Borrower or the applicable Restricted Person, as the
case may be, and acknowledged by Administrative Agent, and each such waiver or
consent shall be effective only in the specific instance and for the specific
purpose for which given; provided, however, that no such amendment, waiver or
consent shall:

 

(i)            waive any condition set forth in Section 4.1 without the written
consent of each Lender (provided Administrative Agent may in its discretion
withdraw any request it has made under Section 4.1(i) to the extent such request
does not pertain to an item expressly covered by any other subsection of Section
4.1);

 

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(ii)           extend or increase the Commitment of any Lender (or reinstate any
Commitment terminated pursuant to Section 8.1) without the written consent of
such Lender;

 

(iii)          postpone any date fixed by this Agreement or any other Loan
Document for any payment or mandatory prepayment of principal, interest, fees or
other amounts due to the Lenders (or any of them) hereunder or under any other
Loan Document without the written consent of each Lender directly affected
thereby;

 

(iv)          reduce the principal of, or the rate of interest specified herein
on, any Loan, or (subject to clause (iii) of the proviso at the end of this
Section 10.1) any fees or other amounts payable hereunder or under any other
Loan Document, or change the manner of computation of any financial ratio
(including any change in any applicable defined term) used in determining the
Applicable Margin that would result in a reduction of any interest rate on any
Loan or any fee payable hereunder without the written consent of each Lender
directly affected thereby; provided, however, and for the avoidance of doubt,
that only the consent of the Majority Lenders shall be necessary (A) to amend
the definition of “Default Rate” or to waive any obligation of Borrower to pay
interest at the Default Rate or (B) to amend any financial covenant hereunder
(or any defined term used therein) even if the effect of such amendment would be
to reduce the rate of interest on any Loan or to reduce any fee payable
hereunder;

 

(v)           change Section 9.11 or Section 8.2 in a manner that would alter
the pro rata sharing of payments required thereby without the written consent of
each Lender; or

 

(vi)          change any provision of this Section or the definition of
“Majority Lenders” or any other provision hereof specifying the number or
percentage of Lenders required to amend, waive or otherwise modify any rights
hereunder or make any determination or grant any consent hereunder, without the
written consent of each Lender;  or

 

(vii)         except as expressly provided herein or in any other Loan Document,
release (A) Borrower from its obligation to pay such Lender’s Note, (B) any
Guarantor from its guaranty of such payment or (C) any Restricted Person from
the negative pledge covenant set forth in Section 7.11 hereof.

 

and, provided further, that (i) no amendment, waiver or consent shall, unless in
writing and signed by Administrative Agent, in addition to the Lenders required
above, affect the rights or duties of Administrative Agent under this Agreement
or any other Loan Document; and (ii) any fee letter between Borrower and
Administrative Agent may be amended, or rights or privileges thereunder waived,
in a writing executed only by the parties thereto. Notwithstanding anything to
the contrary herein, no Defaulting Lender shall have any right to approve or
disapprove any amendment, waiver or consent hereunder or any other Loan
Document, nor shall a Defaulting Lender’s vote or status as a Lender be required
in determining majority, unanimity or other condition or effect of any vote,
except that the Commitment of such Lender may not be increased or extended
without the consent of such Lender.

 

(b)           Acknowledgments and Admissions. Borrower hereby represents,
warrants, acknowledges and admits that  (i) it has been advised by counsel in
the negotiation, execution and delivery of the Loan Documents to which it is a
party, (ii)  no Lender Party has any fiduciary

 

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obligation toward Borrower with respect to any Loan Document or the transactions
contemplated thereby, (iii) the relationship pursuant to the Loan Documents
between Borrower and the other Restricted Persons, on one hand, and each Lender
Party, on the other hand, is and shall be solely that of debtor and creditor,
respectively, and (iv) no partnership or joint venture exists with respect to
the Loan Documents between any Restricted Person and any Lender Party.

 

(c)           Representation by Lenders. Each Lender hereby represents that it
will acquire its Notes for its own account in the ordinary course of its
commercial lending or investing business; however, the disposition of such
Lender’s property shall at all times be and remain within its control and, in
particular and without limitation, such Lender may sell or otherwise transfer
its Note, any participation interest or other interest in its Note, or any of
its other rights and obligations under the Loan Documents subject to compliance
with Section 10.5 and applicable Law.

 

(d)           JOINT ACKNOWLEDGMENT. THIS WRITTEN AGREEMENT AND THE OTHER LOAN
DOCUMENTS REPRESENT THE FINAL AGREEMENT BETWEEN THE PARTIES AND MAY NOT BE
CONTRADICTED BY EVIDENCE OF PRIOR, CONTEMPORANEOUS, OR SUBSEQUENT ORAL
AGREEMENTS OF THE PARTIES.

 

THERE ARE NO UNWRITTEN ORAL AGREEMENTS BETWEEN THE PARTIES.

 

(e)           Joint and Several Liability. All Obligations which are incurred by
two or more Restricted Persons shall be their joint and several obligations and
liabilities of such Restricted Persons.

 

(f)            No Recourse to Other Persons. No past, present or future
director, officer, partner, employee, incorporator, manager, stockholder,
unitholder or member of Borrower, General Partner or GP LLC, and no past,
present or future director, officer, partner, employee, incorporator, manager,
stockholder, unitholder or member of Borrower or any Guarantor who, in each such
case, is a natural person, shall have any liability for any Obligations or for
any claim based on, in respect of, or by reason of, the Obligations or their
creation. Each Lender Party waives and releases all such liability. The waiver
and release are part of the consideration for the making of the Notes

 

Section 10.2.          Survival of Representations, Warranties and Agreements;
Cumulative Nature. All of Restricted Persons’ various representations,
warranties, covenants and agreements in the Loan Documents shall survive the
execution and delivery of this Agreement and the other Loan Documents and the
performance hereof and thereof, including the making or granting  of the Loans
and the delivery of the Notes and the other Loan Documents, and shall further
survive until all of the Obligations are paid in full to each Lender Party and
all of Lender Parties’ obligations to Borrower are terminated. Such
representations and warranties have been or will be relied upon by
Administrative Agent and each Lender, regardless of any investigation made by
Administrative Agent or any Lender or on their behalf and notwithstanding that
Administrative Agent or any Lender may have had notice or knowledge of any
Default at the time of any credit extension hereunder. The rights, powers, and
privileges granted to Lender Parties in the Loan Documents, are cumulative, and,
except for expressly specified waivers and

 

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consents, no Loan Document shall be construed in the context of another to
diminish, nullify, or otherwise reduce the benefit to any Lender Party of any
such right, power or privilege.

 

Section 10.3.          Notices; Effectiveness; Electronic Communication.

 

(a)           Notices Generally. Except in the case of notices and other
communications expressly permitted to be given by telephone or otherwise (and
except as provided in subsection (b) below), all notices and other
communications provided for herein shall be in writing and shall be delivered by
hand or overnight courier service, mailed by certified or registered mail or
sent by telecopier or other electronic transmission as follows, and all notices
and other communications expressly permitted hereunder to be given by telephone
shall be made to the applicable telephone number, as follows:

 

(i)            if to Borrower or Administrative Agent, to the address,
telecopier number, electronic mail address or telephone number specified for
such Person on Schedule 10.3; and

 

(ii)           if to any other Lender, to the address, telecopier number,
electronic mail address or telephone number specified in its Administrative
Questionnaire if it has been delivered to the party sending such notice or
communication; otherwise to such address reasonably believed to be correct by
the sending party.

 

Notices sent by hand or overnight courier service, or mailed by certified or
registered mail, shall be deemed to have been given when received; notices sent
by telecopier shall be deemed to have been given when received (except that, if
not given during normal business hours for the recipient, shall be deemed to
have been received at the opening of business on the next business day for the
recipient), with confirmation of the transmittal of any such telecopied notice
evidencing receipt thereof. Notices delivered through electronic communications
to the extent provided in subsection (b) below, shall be effective as provided
in such subsection (b).

 

(b)           Electronic Communications. Notices and other communications to the
Lenders hereunder may be delivered or furnished by electronic communication
(including e-mail and Internet or intranet websites) pursuant to procedures
approved by Administrative Agent, provided that the foregoing shall not apply to
notices to any Lender pursuant to Article II if such Lender has notified
Administrative Agent that it is incapable of receiving notices under such
Article by electronic communication. Administrative Agent or Borrower may, in
its discretion, agree to accept notices and other communications to it hereunder
by electronic communications pursuant to procedures approved by it, provided
that approval of such procedures may be limited to particular notices or
communications.

 

Unless Administrative Agent otherwise prescribes, (i) notices and other
communications sent to an e-mail address shall be deemed received upon the
sender’s receipt of an acknowledgement from the intended recipient (such as by
the “return receipt requested” function, as available, return e-mail or other
written acknowledgement), provided that if such notice or other communication is
not sent during the normal business hours of the recipient, such notice or
communication shall be deemed to have been sent at the opening of business on
the next business day for the recipient, and (ii) notices or communications
posted to an Internet or intranet website shall be deemed received upon the
deemed receipt by the intended recipient at

 

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its e-mail address as described in the foregoing clause (i) of notification that
such notice or communication is available and identifying the website address
therefor.

 

(c)           Change of Address, Etc. Each of Borrower and Administrative Agent
may change its address, telecopier, e-mail address or telephone number for
notices and other communications hereunder by notice to the other parties
hereto. Each other Lender may change its address, telecopier, e-mail address or
telephone number for notices and other communications hereunder by notice to
Borrower and Administrative Agent.

 

(d)           Reliance by Administrative Agent and Lenders. The Lender Parties
shall be entitled to rely and act upon any notices each of them reasonably
believes is purportedly given by or on behalf of Borrower even if (i) such
notices were not made in a manner specified herein, were incomplete or were not
preceded or followed by any other form of notice specified herein, or (ii) the
terms thereof, as understood by the recipient, varied from any confirmation
thereof. Borrower shall indemnify the Lender Parties from all losses, costs,
expenses and liabilities resulting from the reliance by such Person on each
notice it reasonably believes is purportedly given by or on behalf of Borrower,
as provided in Section 10.4(b). All telephonic notices to and other telephonic
communications with Administrative Agent may be recorded by Administrative
Agent, and each of the parties hereto hereby consents to such recording.

 

Section 10.4.          Expenses; Indemnity; Damage Waiver.

 

(a)           Payment of Expenses. Borrower shall pay (i) all reasonable
out-of-pocket expenses incurred by Administrative Agent and its Affiliates
(including the reasonable fees, charges and disbursements of counsel for
Administrative Agent), in connection with the preparation, negotiation,
execution, delivery and administration of this Agreement and the other Loan
Documents or any amendments, modifications or waivers of the provisions hereof
or thereof (whether or not the transactions contemplated hereby or thereby shall
be consummated), and (ii) all out-of-pocket expenses incurred by Administrative
Agent or any Lender (including the fees, charges and disbursements of any
counsel for Administrative Agent or any Lender and all fees and time charges for
attorneys who may be employees of Administrative Agent), in connection with the
enforcement or protection of its rights under this Agreement and the other Loan
Documents, including its rights under this Section and out-of-pocket expenses
incurred during any workout, restructuring or negotiations in respect of such
Loans.

 

(b)           Indemnity. Borrower agrees to indemnify each Lender Party from and
against any and all liabilities, obligations, claims, losses, damages,
penalties, fines, actions, judgments, suits, settlements, costs, expenses or
disbursements (including reasonable fees of attorneys, accountants, experts and
advisors) of any kind or nature whatsoever (in this section collectively called
“liabilities and costs”) which to any extent (in whole or in part) may be
imposed on, incurred by, or asserted against such Lender Party growing out of,
resulting from or in any other way associated with the Loan Documents and the
transactions and events (including the enforcement or defense thereof) at any
time associated therewith or contemplated therein and Borrower’s use of Loan
proceeds (whether arising in contract or in tort or otherwise and including any
violation or noncompliance with any Environmental Laws by any Lender Party or
any other Person or any liabilities or duties of any Lender Party or any other
Person with respect to Hazardous Materials found in or released into the
environment). In the case of an

 

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investigation, litigation or proceeding to which the indemnity in this Section
10.4 applies, such indemnity shall be effective whether or not such
investigation, litigation or proceeding is brought by Borrower, any of its
equity holders, Affiliates or creditors or a Lender Party or any third party and
whether or not a Lender Party is otherwise a party thereto.

 

THE FOREGOING INDEMNIFICATION SHALL APPLY WHETHER OR NOT SUCH LIABILITIES AND
COSTS ARE IN ANY WAY OR TO ANY EXTENT OWED, IN WHOLE OR IN PART, UNDER ANY CLAIM
OR THEORY OF STRICT LIABILITY OR CAUSED, IN WHOLE OR IN PART, BY ANY NEGLIGENT
ACT OR OMISSION OF ANY KIND BY ANY LENDER PARTY, provided only that no Lender
Party shall be entitled under this section to receive indemnification for that
portion, if any, of any liabilities and costs which (i) is proximately caused by
its own (A) individual gross negligence or willful misconduct, as determined in
a final judgment, or (B) material breach of any of its obligations hereunder or
under any other Loan Documents, as determined in a final judgment or (ii) arises
by reason of a claim (A) by any one or more Lender Parties against any one or
more other Lender Parties or (B) by an equity-interest owner of any Lender Party
against any one or more Lender Parties, so long as in either such case, such
claim is not proximately caused solely by the breach hereunder or under any
other Loan Document by Borrower or its Affiliates. If any Person (including
Borrower or any of its Affiliates) ever alleges gross negligence or willful
misconduct pursuant to the preceding clause (i)(A) (but, for the avoidance of
doubt, not with respect to an allegation of a material breach pursuant to the
preceding clause (i)(B)) by any Lender Party, the indemnification provided for
in this section shall nonetheless be paid upon demand, subject to later
adjustment or reimbursement, until such time as a court of competent
jurisdiction enters a final judgment as to the extent and effect of the alleged
gross negligence or willful misconduct. As used in this section the term “Lender
Party” shall refer not only to each Person designated as such in Section 1.1 but
also to each director, officer, trustee, agent, attorney, employee,
representative and Affiliate of such Persons. So long as no Default has occurred
and is continuing and Borrower is financially solvent, no Lender Party may
settle any claim to be indemnified without the consent of Borrower, such consent
not to be unreasonably withheld; provided that Borrower may not reasonably
withhold consent to any settlement that a Lender Party proposes, if Borrower
does not have the financial ability to pay all its obligations outstanding and
asserted against Borrower at that time, including the maximum potential claims
against the Lender Party to be indemnified pursuant to this Section 10.4.

 

(c)           Reimbursement by Lenders. To the extent that any amounts required
to be paid to Administrative Agent or any Related Party of Administrative Agent
pursuant to subsection (a) or (b) of this Section 10.4 are not indefeasibly
paid, each Lender severally agrees to pay to Administrative Agent or such
Related Party, as the case may be, such Lender’s Percentage Share (determined as
of the time that the applicable unreimbursed expense or indemnity payment is
sought) of such unpaid amount, provided that the unreimbursed expense or
indemnified loss, claim, damage, liability or related expense, as the case may
be, was incurred by or asserted against Administrative Agent in its capacity as
such or against any such Related Party of any of the foregoing acting for
Administrative Agent in connection with such capacity. The obligations of the
Lenders under this subsection (c) shall be several, as provided in the second
next to last sentence of Section 2.2 with respect to the several obligations of
Lenders to make Loans.

 

(d)           Waiver of Consequential Damages, Etc. To the fullest extent
permitted by applicable law, no party hereto or Related Party of any party
hereto shall assert, and hereby

 

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waives, any claim against each other party hereto and its Related Parties
(including, as applicable, each indemnitee referred to in subsection (b) above),
on any theory of liability, for special, indirect, consequential or punitive
damages (as opposed to direct or actual damages) arising out of, in connection
with, or as a result of, this Agreement, any other Loan Document or any
agreement or instrument contemplated hereby, the transactions contemplated
hereby or thereby, any Loan or the use of the proceeds thereof. No indemnitee
referred to in subsection (b) above shall be liable for any damages arising from
the use by unintended recipients of any information or other materials
distributed by it through telecommunications, electronic or other information
transmission systems in connection with this Agreement or the other Loan
Documents or the transactions contemplated hereby or thereby other than as a
result of such indemnitee’s gross negligence, willful misconduct or material
breach of any of its obligations under any Loan Document.

 

(e)           Interest. Borrower hereby promises to pay to each Lender Party
interest at the Default Rate on all obligations to pay fees or to reimburse or
indemnify any Lender Party which Borrower has promised to pay to such Lender
Party pursuant to this Section 10.4 and which are not paid when due. Such
interest shall accrue from the date such Obligations become due until they are
paid.

 

(f)            Payments. All amounts due under this Section shall be payable not
later than ten Business Days after demand therefor and Borrower’s receipt of
reasonably detailed invoices or statements related thereto.

 

(g)           Survival. The agreements in this Section shall survive the
resignation of Administrative Agent, the replacement of any Lender, the
termination of the Commitments and the repayment, satisfaction or discharge of
all the other Obligations.

 

Section 10.5.          Successors and Assigns.

 

(a)           Successors and Assigns Generally. The provisions of this Agreement
shall be binding upon and inure to the benefit of the parties hereto and their
respective successors and assigns permitted hereby, except that no Borrower nor
any other Restricted Person may assign or otherwise transfer any of its rights
or obligations hereunder without the prior written consent of Administrative
Agent and each Lender, and no Lender may assign or otherwise transfer any of its
rights or obligations hereunder except (i) to an Eligible Assignee in accordance
with the provisions of subsection (b) of this Section, (ii) by way of
participation in accordance with the provisions of subsection (d) of this
Section, or (iii) by way of pledge or assignment of a security interest subject
to the restrictions of subsection (f) of this Section (and any other attempted
assignment or transfer by any party hereto shall be null and void). Nothing in
this Agreement, expressed or implied, shall be construed to confer upon any
Person (other than the parties hereto, their respective successors and assigns
permitted hereby, Participants to the extent provided in subsection (d) of this
Section and, to the extent expressly contemplated hereby, the Affiliates of
Administrative Agent and the Lenders) any legal or equitable right, remedy or
claim under or by reason of this Agreement.

 

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(b)           Assignments by Lenders. Any Lender may at any time assign to one
or more Eligible Assignees all or a portion of its rights and obligations under
this Agreement (including all or a portion of its Commitment and the Loans at
the time owing to it); provided that:

 

(i)            except (A) in the case of an assignment of the entire remaining
amount of the assigning Lender’s Commitments, if any, and the Loans at the time
owing to it, or (B) in the case of an assignment to a Lender and the assigning
Lender retains a Commitment of $5,000,000, the aggregate amount of the
Commitment (which for this purpose includes Loans outstanding thereunder) or, if
the Commitment is not then in effect, the principal outstanding balance of the
Loans of the assigning Lender subject to each such assignment, determined as of
the date the Assignment and Assumption with respect to such assignment is
delivered to Administrative Agent or, if “Trade Date” is specified in the
Assignment and Assumption, as of the Trade Date, shall not be less than
$5,000,000, unless Administrative Agent and, so long as no Event of Default has
occurred and is continuing, Borrower otherwise consents (each such consent not
to be unreasonably withheld or delayed);

 

(ii)           each partial assignment shall be made as an assignment of a
proportionate part of all the assigning Lender’s rights and obligations under
this Agreement with respect to the Loans or the Commitment assigned;

 

(iii)          any assignment of a Commitment must be approved by Administrative
Agent unless the Person that is the proposed assignee is itself a Lender
(whether or not the proposed assignee would otherwise qualify as an Eligible
Assignee); and

 

(iv)          the parties to each assignment shall execute and deliver to
Administrative Agent an Assignment and Assumption, together with a processing
and recordation fee payable by such assignor Lender (and not at Borrower’s
expense) of $3,500, and the Eligible Assignee, if it shall not be a Lender,
shall deliver to Administrative Agent an Administrative Questionnaire.

 

Subject to acceptance and recording thereof by Administrative Agent pursuant to
subsection (c) of this Section, from and after the effective date specified in
each Assignment and Assumption, the Eligible Assignee thereunder shall be a
party to this Agreement and, to the extent of the interest assigned by such
Assignment and Assumption, have the rights and obligations of a Lender under
this Agreement, and the assigning Lender thereunder shall, to the extent of the
interest assigned by such Assignment and Assumption, be released from its
obligations under this Agreement (and, in the case of an Assignment and
Assumption covering all of the assigning Lender’s rights and obligations under
this Agreement, such Lender shall cease to be a party hereto) but shall continue
to be entitled to the benefits of Sections 3.2, 3.3, 3.6 and 3.7 and Section
10.4 with respect to facts and circumstances occurring prior to the effective
date of such assignment. Upon request, Borrower (at its expense) shall execute
and deliver a Note to the assignee Lender against receipt by Borrower of the
canceled original Note of the assignor, if its entire Commitment was assigned,
or evidence that such assignor’s Note is marked to reflect its reduction.. Any
assignment or transfer by a Lender of rights or obligations under this Agreement
that does not comply with this subsection shall be treated for purposes of this
Agreement as a sale by such Lender of a participation in such rights and
obligations in accordance with subsection (d) of this Section.

 

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Each Eligible Assignee of a US Lender which is not a United States person (as
such term is defined in Section 7701(a)(30) of the Code) for Federal income tax
purposes, must (to the extent it has not already done so) provide Administrative
Agent and Borrower with the “Prescribed Forms” referred to in Section 3.7(d).

 

(c)           Register. Administrative Agent, acting solely for this purpose as
an agent of Borrower, shall maintain at its Applicable Lending Office a copy of
each Assignment and Assumption delivered to it and a register for the
recordation of the names and addresses of the Lenders, and the Commitments of,
and principal amounts of the Loans owing to, each Lender pursuant to the terms
hereof from time to time (the “Register”). The entries in the Register shall be
conclusive, absent manifest error, and Borrower, Administrative Agent and the
Lenders may treat each Person whose name is recorded in the Register pursuant to
the terms hereof, and its correspondingly recorded Commitment, as a Lender
hereunder owning such Commitment for all purposes of this Agreement,
notwithstanding notice to the contrary. The Register shall be available for
inspection by Borrower at any reasonable time and from time to time upon
reasonable prior notice. In addition, at any time (i) requested by Borrower or
(ii) that a request for a consent for a material or substantive change to the
Loan Documents is pending, Borrower or any Lender wishing to consult with other
Lenders in connection therewith, as applicable, may request and receive from
Administrative Agent a copy of the Register.

 

(d)           Participations. Any Lender may at any time, without the consent
of, or notice to, Borrower or Administrative Agent, sell participations to any
Person (other than a natural person or Borrower or any of Borrower’s Affiliates
or Subsidiaries) (each, a “Participant”) in all or a portion of the Obligations
owing to such Lender and such Lender’s rights related thereto and such Lender’s
obligations under this Agreement (including all or a portion of its Commitment
and/or the Obligations owing to it); provided that (i) such Lender’s obligations
under this Agreement shall remain unchanged, (ii) such Lender shall remain
solely responsible to the other parties hereto for the performance of such
obligations and (iii) Borrower, Administrative Agent and the Lenders shall
continue to deal solely and directly with such Lender in connection with such
Lender’s rights and obligations under this Agreement.

 

Any agreement or instrument pursuant to which a Lender sells such a
participation shall provide that such Lender shall retain the sole right to
enforce this Agreement and to approve any amendment, modification or waiver of
any  provision of this Agreement; provided that such agreement or instrument may
provide that such Lender will not, without the consent of the Participant, agree
to any amendment, waiver or other modification described in the first proviso to
Section 10.1 that directly affects such Participant. Subject to subsection (e)
of this Section, Borrower agrees that each Participant shall be entitled to the
benefits of Sections 3.2, 3.3, 3.6 and 3.7 and the obligations imposed by such
Sections, and shall be subject to replacement pursuant to Section 3.8, to the
same extent as if it were a Lender and had acquired its interest by assignment
pursuant to subsection (b) of this Section. To the extent permitted by law, each
Participant also shall be entitled to the benefits of Section 10.11 as though it
were a Lender, provided such Participant agrees to be subject to Section 9.11 as
though it were a Lender.

 

(e)           Limitation upon Participant Rights. A Participant shall not be
entitled to receive any greater payment under Sections 3.2 through 3.7 than the
applicable Lender would have been entitled to receive with respect to the
participation sold to such Participant, unless the sale of the

 

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participation to such Participant is made with Borrower’s prior written consent,
which consent sets forth an express waiver of the limitation on Sections 3.2
through 3.7 which are set forth in this subsection.

 

(f)            Certain Pledges. Any Lender may at any time pledge or assign a
security interest in all or any portion of its rights under this Agreement
(including under its Notes, if any) to secure obligations of such Lender,
including any pledge or assignment to secure obligations to a Federal Reserve
Bank; provided that no such pledge or assignment shall release such Lender from
any of its obligations hereunder or substitute (or, except as to the Federal
Reserve Bank, permit the substitution of) any such pledgee or assignee for such
Lender as a party hereto, and all costs, fees and expenses related to any such
pledge shall be for the sole account of such Lender.

 

(g)           Electronic Execution of Assignments. The words “execution,”
“signed,” “signature,” and words of like import in any Assignment and Assumption
shall be deemed to include electronic signatures or the keeping of records in
electronic form, each of which shall be of the same legal effect, validity or
enforceability as a manually executed signature or the use of a paper-based
recordkeeping system, as the case may be, to the extent and as provided for in
any applicable law, including the Federal Electronic Signatures in Global and
National Commerce Act, the New York State Electronic Signatures and Records Act,
or any other similar state laws based on the Uniform Electronic Transactions
Act.

 

(h)           Lost Notes. Upon receipt of an affidavit reasonably satisfactory
to Borrower of an officer of any Lender as to the loss, theft, destruction or
mutilation of its Note which is not of public record, and, in the case of any
such loss, theft, destruction or mutilation, upon cancellation of such Note,
Borrower will execute and deliver, in lieu thereof, a replacement Note in the
principal amount of such Lender’s then Commitment or if no Commitment is in
effect, the outstanding principal amount owed to such Lender and otherwise of
like tenor.

 

Section 10.6.          Treatment of Certain Information; Confidentiality. Each
of Administrative Agent and the Lenders (for itself and each of its Affiliates,
and its and their Related Parties) agrees to maintain the confidentiality of the
Information (as defined below), except that Information may be disclosed (a) to
its Affiliates and to its and its Affiliates’ respective partners, directors,
officers, employees, agents, advisors and representatives (it being understood
that the Persons to whom such disclosure is made will be informed of the
confidential nature of such Information and instructed to keep such Information
confidential and will agree to maintain such confidences), (b) to the extent
requested or required by applicable laws or regulations or by any subpoena or
similar legal process, (c) subject to this Section 10.6, to any other party
hereto, (d) in connection with the exercise of any remedies hereunder or under
any other Loan Document or any action or proceeding relating to this Agreement
or any other Loan Document or in connection with any Default or anticipated
Default, the enforcement of rights hereunder or thereunder, (e) subject to an
agreement containing provisions substantially the same as those of this Section,
to (i) any assignee of or Participant in, or any prospective assignee of or
Participant in, any of its rights or obligations under this Agreement or (ii)
any actual or prospective counterparty (or its advisors) to any swap or
derivative transaction relating to, and requested by, Borrower and its
obligations, (f) with the consent of Borrower, or (g) to the extent such
Information becomes publicly available other than as a result of a breach of
this

 

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Section, or becomes available to Administrative Agent, any Lender or any of
their respective Affiliates on a nonconfidential basis from a source other than
Borrower.

 

For purposes of this Section, “Information” means all information received from
any of Borrower or any Subsidiary relating to any of Borrower or any Subsidiary,
or any Affiliate of any of them, or any of their respective businesses, other
than any such information that is available to Administrative Agent or any
Lender on a nonconfidential basis prior to disclosure by any of Borrower or any
Subsidiary, provided that, in the case of information received from any of
Borrower or any Subsidiary after the date hereof, such information is clearly
identified at the time of delivery as confidential. Any Person required to
maintain the confidentiality of Information as provided in this Section shall be
considered to have complied with its obligation to do so if such Person has
exercised the same degree of care to maintain the confidentiality of such
Information as such Person would accord to its own confidential information.

 

Section 10.7.          Governing Law; Submission to Process. EXCEPT TO THE
EXTENT THAT THE LAW OF ANOTHER JURISDICTION IS EXPRESSLY ELECTED IN A LOAN
DOCUMENT, THE LOAN DOCUMENTS SHALL BE DEEMED CONTRACTS AND INSTRUMENTS MADE
UNDER THE LAWS OF THE STATE OF NEW YORK AND SHALL BE CONSTRUED AND ENFORCED IN
ACCORDANCE WITH AND GOVERNED BY THE LAWS OF THE STATE OF NEW YORK AND THE LAWS
OF THE UNITED STATES OF AMERICA, WITHOUT REGARD TO PRINCIPLES OF CONFLICTS OF
LAW. BORROWER HEREBY AGREES THAT ANY LEGAL ACTION OR PROCEEDING AGAINST BORROWER
WITH RESPECT TO THIS AGREEMENT, THE NOTES OR ANY OF THE LOAN DOCUMENTS MAY BE
BROUGHT IN THE COURTS OF THE STATE OF NEW YORK OR OF THE UNITED STATES OF
AMERICA FOR THE SOUTHERN DISTRICT OF NEW YORK AS LENDER PARTIES MAY ELECT, AND,
BY EXECUTION AND DELIVERY HEREOF, BORROWER ACCEPTS AND CONSENTS FOR ITSELF AND
IN RESPECT TO ITS PROPERTY, GENERALLY AND UNCONDITIONALLY, THE NON-EXCLUSIVE
JURISDICTION OF THE AFORESAID COURTS. BORROWER AGREES THAT SECTIONS 5-1401 AND
5-1402 OF THE GENERAL OBLIGATIONS LAW OF THE STATE OF NEW YORK SHALL APPLY TO
THE LOAN DOCUMENTS AND WAIVES ANY RIGHT TO STAY OR TO DISMISS ANY ACTION OR
PROCEEDING BROUGHT BEFORE SAID COURTS ON THE BASIS OF FORUM NON CONVENIENS. IN
FURTHERANCE OF THE FOREGOING, BORROWER HEREBY IRREVOCABLY DESIGNATES AND
APPOINTS CORPORATION SERVICE COMPANY, 80 STATE STREET, ALBANY, NEW YORK 12207,
AS AGENT OF BORROWER TO RECEIVE SERVICE OF ALL PROCESS BROUGHT AGAINST BORROWER
WITH RESPECT TO ANY SUCH PROCEEDING IN ANY SUCH COURT IN NEW YORK, SUCH SERVICE
BEING HEREBY ACKNOWLEDGED BY BORROWER TO BE EFFECTIVE AND BINDING SERVICE IN
EVERY RESPECT. COPIES OF ANY SUCH PROCESS SO SERVED SHALL ALSO, IF PERMITTED BY
LAW, BE SENT BY REGISTERED MAIL TO BORROWER AT ITS ADDRESS SET FORTH BELOW, BUT
THE FAILURE OF BORROWER TO RECEIVE SUCH COPIES SHALL NOT AFFECT IN ANY WAY THE
SERVICE OF SUCH PROCESS AS AFORESAID. BORROWER SHALL FURNISH TO LENDER PARTIES A
CONSENT OF CORPORATION SERVICE COMPANY AGREEING TO ACT HEREUNDER PRIOR TO THE
EFFECTIVE DATE OF THIS AGREEMENT. NOTHING HEREIN SHALL AFFECT THE RIGHT OF
LENDER PARTIES TO SERVE PROCESS IN ANY OTHER MANNER PERMITTED BY LAW OR SHALL
LIMIT THE RIGHT OF LENDER PARTIES TO BRING PROCEEDINGS AGAINST BORROWER IN THE
COURTS OF ANY OTHER JURISDICTION. IF FOR ANY REASON CORPORATION SERVICE COMPANY
SHALL RESIGN OR OTHERWISE CEASE TO ACT AS BORROWER’S AGENT, BORROWER HEREBY
IRREVOCABLY AGREES TO (A) IMMEDIATELY DESIGNATE AND APPOINT A NEW AGENT
ACCEPTABLE TO ADMINISTRATIVE AGENT TO SERVE IN SUCH CAPACITY AND, IN

 

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SUCH EVENT, SUCH NEW AGENT SHALL BE DEEMED TO BE SUBSTITUTED FOR CORPORATION
SERVICE COMPANY FOR ALL PURPOSES HEREOF AND (B) PROMPTLY DELIVER TO
ADMINISTRATIVE AGENT THE WRITTEN CONSENT (IN FORM AND SUBSTANCE SATISFACTORY TO
ADMINISTRATIVE AGENT) OF SUCH NEW AGENT AGREEING TO SERVE IN SUCH CAPACITY.

 

Section 10.8.          Intentionally deleted.

 

Section 10.9.          Intentionally deleted.

 

Section 10.10.        Limitation on Interest. Lender Parties, Restricted Persons
and any other parties to the Loan Documents intend to contract in strict
compliance with applicable usury Law from time to time in effect. In furtherance
thereof such Persons stipulate and agree that none of the terms and provisions
contained in the Loan Documents shall ever be construed to create a contract to
pay, for the use, forbearance or detention of money, interest in excess of the
maximum amount of interest permitted to be contracted for, charged, or received
by applicable Law from time to time in effect. Neither any Restricted Person nor
any present or future guarantors, endorsers, or other Persons hereafter becoming
liable for payment of any Obligation shall ever be liable for unearned interest
thereon or shall ever be required to pay interest thereon in excess of the
maximum amount that may be lawfully contracted for, charged, or received under
applicable Law from time to time in effect, and the provisions of this section
shall control over all other provisions of the Loan Documents which may be in
conflict or apparent conflict herewith. Lender Parties expressly disavow any
intention to contract for, charge, or receive excessive unearned interest or
finance charges in the event the maturity of any Obligation is accelerated. If
(a) the maturity of any Obligation is accelerated for any reason, (b) any
Obligation is prepaid and as a result any amounts held to constitute interest
are determined to be in excess of the legal maximum, or (c) any Lender or any
other holder of any or all of the Obligations shall otherwise collect moneys
which are determined to constitute interest which would otherwise increase the
interest on any or all of the Obligations to an amount in excess of that
permitted to be contracted for, charged or received by applicable Law then in
effect, then all sums determined to constitute interest in excess of such legal
limit shall, without penalty, be promptly applied to reduce the then outstanding
principal of the related Obligations or, at such Lender’s or holder’s option,
promptly returned to Borrower or other payor thereof upon such determination. In
determining whether or not the interest paid or payable, under any specific
circumstance, exceeds the maximum amount permitted under applicable Law, Lender
Parties and Restricted Persons (and any other payors thereof) shall to the
greatest extent permitted under applicable Law, (i) characterize any
non-principal payment as an expense, fee or premium rather than as interest,
(ii) exclude voluntary prepayments and the effects thereof, and (iii) amortize,
prorate, allocate, and spread the total amount of interest throughout the entire
contemplated term of the instruments evidencing the Obligations in accordance
with the amounts outstanding from time to time thereunder and the maximum legal
rate of interest from time to time in effect under applicable Law in order to
lawfully charge the maximum amount of interest permitted under applicable Law.
In the event applicable Law provides for an interest ceiling under Chapter 303
of the Texas Finance Code (the “Texas Finance Code”) as amended, to the extent
that the Texas Finance Code is mandatorily applicable to any Lender, for that
day, the ceiling shall be the “weekly ceiling” as defined in the Texas Finance
Code, provided that if any applicable Law permits greater interest, the Law
permitting the greatest interest shall apply. In no event shall

 

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Chapter 346 of the Texas Finance Code apply to this Agreement or any other Loan
Document, or any transactions or loan arrangement provided or contemplated
hereby or thereby.

 

Section 10.11         Right of Offset. At any time and from time to time during
the continuance of any Event of Default, each Lender is hereby authorized to
offset against the Obligations then due and payable (without notice to any
Restricted Person), (a) any and all moneys, securities or other property (and
the proceeds therefrom) of such Restricted Person now or hereafter held or
received by or in transit to any Lender or its Affiliates from or for the
account of such Restricted Person, whether for safekeeping, custody, pledge,
transmission, collection or otherwise, (b) any and all deposits (general or
special, time or demand, provisional or final) of such Restricted Person with
any Lender or its Affiliates, and (c) any other credits and claims of such
Restricted Person at any time existing against any Lender, including claims
under certificates of deposit.

 

Section 10.12.        Termination; Limited Survival; Payments Set Aside. In its
sole and absolute discretion Borrower may at any time that no Obligations are
owing or outstanding elect in a written notice delivered to Administrative Agent
to terminate this Agreement. Upon receipt by Administrative Agent of such a
notice, if no Obligations are then owing or outstanding this Agreement and all
other Loan Documents shall thereupon be terminated and the parties thereto
released from all prospective obligations thereunder. Notwithstanding the
foregoing or anything herein to the contrary, any waivers or admissions made by
any Restricted Person in any Loan Document, any Obligations under Sections 3.2
through 3.6, and any obligations which any Person may have to indemnify or
compensate any Lender Party shall survive any termination of this Agreement or
any other Loan Document. At the request and expense of Borrower, Administrative
Agent shall prepare and execute all necessary instruments to reflect and effect
such termination of the Loan Documents. Administrative Agent is hereby
authorized to execute all such instruments on behalf of all Lenders, without the
joinder of or further action by any Lender.

 

To the extent that any payment by or on behalf of Borrower is made to
Administrative Agent or any Lender, or Administrative Agent or any Lender
exercises its right of setoff, and such payment or the proceeds of such setoff
or any part thereof is subsequently invalidated, declared to be fraudulent or
preferential, set aside or required (including pursuant to any settlement
entered into by Administrative Agent or such Lender in its discretion) to be
repaid to a trustee, receiver or any other party, in connection with any
proceeding under any debtor relief Law or otherwise, then (a) to the extent of
such recovery, the obligation or part thereof originally intended to be
satisfied shall be revived and continued in full force and effect as if such
payment had not been made or such setoff had not occurred, and (b) each Lender
severally agrees to pay to Administrative Agent upon demand its applicable share
(without duplication) of any amount so recovered from or repaid by
Administrative Agent, plus interest thereon from the date of such demand to the
date such payment is made at a rate per annum equal to the Federal Funds Rate
from time to time in effect, in the applicable currency of such recovery or
payment. The obligations of the Lenders under clause (b) of the preceding
sentence shall survive the payment in full of the Obligations and the
termination of this Agreement.

 

Section 10.13.        Severability. If any term or provision of any Loan
Document shall be determined to be illegal or unenforceable all other terms and
provisions of the Loan Documents

 

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shall nevertheless remain effective and shall be enforced to the fullest extent
permitted by applicable Law.

 

Section 10.14.        Counterparts. This Agreement may be separately executed in
any number of counterparts and by different parties hereto in separate
counterparts, each of which when so executed shall be deemed to constitute one
and the same Agreement.

 

Section 10.15.        Waiver of Jury Trial. EACH PARTY HERETO HEREBY IRREVOCABLY
WAIVES, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY RIGHT IT MAY HAVE
TO A TRIAL BY JURY IN ANY LEGAL PROCEEDING DIRECTLY OR INDIRECTLY ARISING OUT OF
OR RELATING TO THIS AGREEMENT OR ANY OTHER LOAN DOCUMENT OR THE TRANSACTIONS
CONTEMPLATED HEREBY OR THEREBY (WHETHER BASED ON CONTRACT, TORT OR ANY OTHER
THEORY). EACH PARTY HERETO (A) CERTIFIES THAT NO REPRESENTATIVE, AGENT OR
ATTORNEY OF ANY OTHER PERSON HAS REPRESENTED, EXPRESSLY OR OTHERWISE, THAT SUCH
OTHER PERSON WOULD NOT, IN THE EVENT OF LITIGATION, SEEK TO ENFORCE THE
FOREGOING WAIVER AND (B) ACKNOWLEDGES THAT IT AND THE OTHER PARTIES HERETO HAVE
BEEN INDUCED TO ENTER INTO THIS AGREEMENT AND THE OTHER LOAN DOCUMENTS BY, AMONG
OTHER THINGS, THE MUTUAL WAIVERS AND CERTIFICATIONS IN THIS SECTION.

 

Section 10.16.        USA PATRIOT Act Notice. Each Lender that is subject to the
Act (as hereinafter defined) and Administrative Agent (for itself and not on
behalf of any Lender) hereby notifies Borrower that pursuant to the requirements
of the USA Patriot Act (Title III of Pub. L. 107-56 (signed into law November
26, 2001)) (the “Act”), it is required to obtain, verify and record information
that identifies Borrower, which information includes the name and address of
Borrower and other information that will allow such Lender or Administrative
Agent, as applicable, to identify Borrower in accordance with the Act..

 

[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]

 

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IN WITNESS WHEREOF, this Agreement is executed as of the date first written
above.

 

BORROWER:

PLAINS ALL AMERICAN PIPELINE, L.P.

 

 

 

 

By:

PLAINS AAP, L.P.,

 

 

its general partner

 

 

 

 

By:

PLAINS ALL AMERICAN GP LLC,

 

 

its general partner

 

 

 

 

By:

  /s/ Al Swanson

 

 

Al Swanson

 

 

Vice President – Finance and Treasurer

 

Address for Borrower:

 

333 Clay Street, Suite 1600

 

 

Houston, Texas 77002

 

 

Attention: Al Swanson

 

 

Telephone: (713) 646-4455

 

 

Fax: (713) 646-4564

 

 

Website: www.paalp.com

 

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LENDER PARTIES:

JPMORGAN CHASE BANK, N.A.,

 

Administrative Agent and a Lender

 

 

 

 

By:

  /s/  Tara Narasiman

 

 

 Name:

Tara Narasiman

 

 

 Title:

Associate

 

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BANK OF AMERICA, N.A.,

 

Co-Syndication Agent and a Lender

 

 

 

 

 

By:

  /s/ Robert D. Valbona

 

Name:

Robert D. Valbona

 

Title:

Managing Director

 

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CITIBANK, N.A.,

 

Co-Syndication Agent and a Lender

 

 

 

 

 

By:

  /s/  Todd J. Mogi

 

Name:

Todd J. Mogil

 

Title:

Attorney-in-Fact

 

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WACHOVIA BANK,

 

NATIONAL ASSOCIATION,

 

Co-Documentation Agent and a Lender

 

 

 

 

 

By:

  /s/  Shawn Young

 

Name:

Shawn Young

 

Title:

Vice President

 

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UBS LOAN FINANCE LLC,

 

a Lender

 

 

 

 

 

By:

  /s/ Richard L. Tavrow

 

Name:

Richard L. Tavrow

 

Title:

Director

 

 

Banking Products Services, US

 

 

By:

  /s/ Irja R. Otsa

 

Name:

Irja R. Otsa

 

Title:

Associate Director

 

 

Banking Products Services, US

 

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BNP PARIBAS,

 

Managing Agent and a Lender

 

 

 

 

 

By:

  /s/ Marcie Weiss

 

Name:

Marcie Weiss

 

Title:

Managing Director

 

 

 

 

By:

   /s/ Richard J. Wernli

 

Name:

Richard J. Wernli

 

Title:

Director

 

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SUNTRUST BANK,

 

Managing Agent and a Lender

 

 

 

 

 

By:

  /s/ Jeffrey R. Titus

 

Name:

Jeffrey R. Titus

 

Title:

Managing Director

 

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