Exhibit 10.2

EXECUTION DRAFT

PERSONAL AND CONFIDENTIAL

July 12, 2010

Magellan Midstream Partners, L.P.

One Williams Center

Suite 2800

Tulsa Oklahoma 74172

 

  Re: Magellan Midstream Partners, L.P.

$300,000,000 364-Day Revolving Credit Facility

Ladies and Gentlemen:

You have advised J.P. Morgan Securities Inc. (“JPM Securities” or sometimes the
“Arranger”), JPMorgan Chase Bank, N.A. (“JPMorgan”), Bank of America, N.A.
(“BofA”), Morgan Stanley Senior Funding, Inc. (“MSSF”), and Wells Fargo Bank,
National Association (“WFB” and together with JPMorgan, BofA and MSSF
collectively, the “Lenders” or sometimes “we” or “us”), that Magellan Midstream
Partners, L.P., Delaware limited partnership (the “Company”) intends to put in
place a new credit facility for the purpose of providing working capital and for
other general partnership purposes, including acquisitions. In addition, you
have requested that the Arranger agree to structure, arrange and syndicate the
facility in an amount of $300,000,000 (the “Facility”), and that JPMorgan serve
as Administrative Agent.

JPM Securities is pleased to advise you that it is willing to act as Arranger
and bookrunner for the Facility on terms and conditions set forth or referred to
in this commitment letter (this “Commitment Letter”). Furthermore, each of
JPMorgan, BofA, MSSF and WFB is pleased to advise you of its commitment to
severally (but not jointly) provide $75,000,000 of the Facility (individually, a
“Commitment”, and collectively, the “Commitments”) upon the terms and subject to
the conditions set forth or referred to in this Commitment Letter, in the
Summary of Terms and Conditions attached hereto as Exhibit A (the “Term Sheet”)
and in the Fee Letter referred to below.

The obligations of the Arranger and the Commitment of each Lender hereunder are
several and not joint. Neither the Arranger nor any Lender is responsible for
the performance of the obligations of any other Lender, and the failure of the
Arranger or any Lender to perform its respective obligations hereunder will not
prejudice the rights of either the Arranger or any Lender hereto.

It is agreed that JPMorgan will act as the sole and exclusive Administrative
Agent, and that JPM Securities will act as the sole Arranger and bookrunner, for
the Facility, and each will, in such capacities, perform the duties and exercise
the authority customarily performed and exercised by it in such roles. You agree
that no other agents, co-agents or arrangers will be appointed, no other titles
will be awarded, and, except as provided in the Fee Letter referred to below, no
compensation (other than that expressly contemplated herein and by the Term
Sheet) will be paid in connection with the Facility unless you and we shall so
agree.

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Magellan Midstream Partners, L.P.

Commitment Letter

July 12, 2010

Page 2

 

You agree promptly to prepare and provide to the Arranger all information with
respect to the Company, its subsidiaries, and any other transactions
contemplated hereby and by the Term Sheet and that certain letter dated the date
hereof among you, JPM Securities and JPMorgan (the “Fee Letter”), including all
financial information, as we may reasonably request in connection with the
arrangement of the Facility. You hereby represent, covenant and warrant that
(a) all information, taken as a whole (the “Information”), that has been or will
be made available to the Arranger and the Lenders by you or any of your
representatives is or will be, when furnished, complete and correct in all
material respects and does not or will not, when furnished, contain any untrue
statement of a material fact or omit to state a material fact necessary in order
to make the statements contained therein not materially misleading in light of
the circumstances under which such statements are made and (b) the projections
(the “Projections”) that have been or will be made available to the Arranger and
the Lenders by you or any of your representatives have been or will be prepared
in good faith based upon assumptions you believe to be reasonable, subject to
the uncertainties inherent in all projections. You understand that we may use
and rely on the Information without independent verification thereof. You hereby
acknowledge and consent that, for the purposes of carrying out their obligations
hereunder, the Arranger and the Lenders may share the Information, the
Projections and any other information or matters relating to you and your
subsidiaries or the transactions contemplated hereby with their affiliates which
are involved in the consideration of the Facility and that such affiliates may
likewise share information relating to you and your subsidiaries or such
transactions with the Arranger and the Lenders.

Neither the Arranger nor any Lender shall in any event be subject to any
fiduciary or other implied duties. Additionally, you acknowledge and agree that,
neither the Arranger nor any Lender is advising you as to any legal, tax,
investment, accounting or regulatory matters in any jurisdiction. You shall
consult with your own advisors concerning such matters and shall be responsible
for making your own independent investigation and appraisal of the transactions
contemplated hereby, and neither the Arranger nor any Lender shall have any
responsibility or liability to you with respect thereto. Any review by the
Arranger or any Lender of the Company, the transactions contemplated hereby or
other matters relating to such transactions will be performed solely for the
benefit of the Arranger or such Lender and shall not be on behalf of the
Company.

As consideration for the Lenders’ Commitments hereunder and the Arranger’s
agreements to perform the services described herein, on the Closing Date (except
as otherwise expressly provided herein and in the Fee Letter), you agree to pay
to the Arranger, the Administrative Agent and the Lenders the fees set forth
herein, in the Fee Letter and in the Term Sheet, subject to the terms and
conditions contained in these documents. In addition, as consideration for the
Lenders providing their Commitments to the Facility, contemporaneously with the
execution by the Company of this Commitment Letter, the Company shall also pay
an upfront fee in the amount of $150,000 to each Lender.

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Magellan Midstream Partners, L.P.

Commitment Letter

July 12, 2010

Page 3

 

The Commitments of the Lenders hereunder and the agreements of the Arranger to
perform the services described herein are subject to (a) in the judgment of the
Arranger or any Lender, since December 31, 2009, there not occurring or becoming
known to us any change, occurrence or development that could reasonably be
expected to be either a material adverse condition or material adverse change in
or affecting the business, operations, property, condition (financial or
otherwise) of the Company and its subsidiaries taken as a whole, (b) our not
becoming aware after the date hereof of any information or other matter
affecting the Company or its subsidiaries, or the transactions contemplated
hereby, which in the reasonable judgment of the Arranger or any Lender, is
inconsistent in a material and adverse manner with any such information or other
matter disclosed to us prior thereto, and (c) the negotiation, execution and
delivery on or before August 15, 2010 of definitive documentation with respect
to the Facility satisfactory to the Arranger, the Lenders and their counsel and
to you and your counsel. The terms and conditions of the Facility are not
limited to those set forth herein and in the Term Sheet. Those matters that are
not covered by the provisions hereof and of the Term Sheet are subject to the
approval and agreement of the Arranger, the Lenders and the Company.

You agree to indemnify and hold harmless the Arranger the Lenders, their
respective affiliates and their respective officers, directors, employees,
advisors, and agents (each, an “Indemnified Person”) from and against any and
all losses, claims, damages and liabilities (including costs of enforcement) to
which any such Indemnified Person may become subject arising out of or in
connection with this Commitment Letter, the Fee Letter, the Facility, the use of
the proceeds thereof, or any related transaction or any claim, litigation,
investigation or proceeding relating to any of the foregoing (“Losses”),
regardless of whether any Indemnified Person is a party thereto, and to
reimburse each Indemnified Person upon demand for any legal or other expenses
and charges invoiced, or billed to, or paid by, such Indemnified Person
reasonably incurred in connection with investigating or defending any of the
foregoing, provided that the foregoing indemnity will not, as to any Indemnified
Person, apply to Losses or related expenses to the extent they are found by a
final, non-appealable judgment of a court of competent jurisdiction to arise
from the willful misconduct, gross negligence, bad faith or unlawful acts of
such Indemnified Person. YOU AGREE THAT THE INDEMNITY CONTAINED IN THE PRECEDING
SENTENCE EXTENDS TO AND IS INTENDED TO COVER LOSSES AND RELATED EXPENSES ARISING
OUT OF THE ORDINARY, SOLE OR CONTRIBUTORY NEGLIGENCE OF AN INDEMNIFIED PERSON.
In addition, you agree to reimburse the Arranger, the Lenders and their
affiliates on demand for all reasonable and documented out-of-pocket expenses
(including due diligence expenses, consultant’s fees and expenses, travel
expenses, and reasonable fees, charges and disbursements of counsel) reasonably
incurred and invoiced or billed to, or paid by, such person in connection with
the Facility and any related documentation (including this Commitment Letter,
the Term Sheet, the Fee Letter and the definitive financing documentation).

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Magellan Midstream Partners, L.P.

Commitment Letter

July 12, 2010

Page 4

 

Notwithstanding any other provision of this Commitment Letter, no Indemnified
Person will be responsible or liable to you or any other person or entity for
damages arising from the use by others of any information or other materials
through internet, electronic, telecommunications or other information
transmission systems.

This Commitment Letter (a) shall not be assigned by any party hereto without the
prior written consent of each other party hereto, each acting in its sole
discretion (and any purported assignment without such consent shall be null and
void), and (b) except as otherwise expressly provided herein, is intended to be
solely for the benefit of the parties hereto and is not intended to confer any
benefits upon, or create any rights in favor of, any person other than the
parties hereto. Any and all obligations of, and services to be provided by us to
you hereunder may be performed, and any and all rights hereunder may be
exercised, by or through our respective affiliates. This Commitment Letter may
not be amended or waived except by an instrument in writing signed by you, the
Arranger and the Lenders. This Commitment Letter may be executed in any number
of counterparts, each of which shall be an original, and all of which, when
taken together, shall constitute one agreement. Delivery of an executed
signature page of this Commitment Letter by facsimile or other electronic
transmission shall be effective as delivery of a manually executed counterpart
hereof. This Commitment Letter (together with the Term Sheet) and the Fee Letter
are the only agreements that have been entered into among us with respect to the
Facility and set forth the entire understanding of the parties with respect
thereto.

This Commitment Letter is delivered to you on the understanding that neither
this Commitment Letter, the Term Sheet or the Fee Letter nor any of their terms
or substance shall be disclosed, directly or indirectly, to any other person
except (a) to you and your general partner and its officers, directors,
employees agents and advisors who are directly involved in the consideration of
this matter or (b) as may be required by subpoena or compelled in a judicial or
administrative proceeding or as otherwise required by law in the opinion of
counsel (in which case you agree to inform us promptly thereof), provided, that
the foregoing restrictions shall cease to apply (except in respect of (i) the
Fee Letter and its terms and substance and (ii) the fees set forth in the
seventh grammatical paragraph hereof) after this Commitment Letter has been
accepted by you.

You acknowledge that the Arranger and the Lenders and their affiliates may be
providing debt financing, equity capital or other services (including financial
advisory services) to other companies in respect of which you may have
conflicting interests regarding the transactions described herein and otherwise.
Neither the Arranger nor the Lenders will use confidential information obtained
from you by virtue of the transactions contemplated by this letter or their
other relationships with you in connection with the performance by the Arranger
or the Lenders of services for other companies, and neither the Arranger nor the
Lenders will furnish any such information to other companies. You also
acknowledge that neither the Arranger nor the Lenders have any obligation to use
in connection with the transactions contemplated by this letter, or to furnish
to you, confidential information obtained from other companies.

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Magellan Midstream Partners, L.P.

Commitment Letter

July 12, 2010

Page 5

 

The Arranger agrees to maintain the confidentiality of the Information, except
that Information may be disclosed (i) to its affiliates and to its and its
affiliates’ respective partners, directors, officers, employees, agents,
advisors and other 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 only use
such Information in connection with the Transaction), (ii) to the extent
requested by any regulatory authority purporting to have jurisdiction over it
(including any self-regulatory authority, such as the National Association of
Insurance Commissioners), (iii) to the extent required by applicable laws or
regulations or by any subpoena or similar legal process, (iv) to any other party
hereto, (v) in connection with the exercise of any remedies hereunder or under
the Facility or any action or proceeding relating to this Commitment Letter or
the Facility or the enforcement of rights hereunder or thereunder, (vi) subject
to an agreement containing provisions substantially the same as those of this
Section, to any assignee of, or any prospective assignee of, any of its rights
or obligations under this Commitment Letter for use in connection with the
Transaction, (vii) with your consent or (viii) to the extent such Information
(x) becomes publicly available other than as a result of a breach of this
Section or (y) becomes available to the Arranger, the Lender or any of their
respective affiliates on a nonconfidential basis from a source other than you.
For purposes of this paragraph, “Information” means all information received
from the Company or any of its Subsidiaries relating to the Company or any of
its Subsidiaries or any of their respective businesses, other than any such
information that is available to the Arranger, any Lender or any of their
respective affiliates on a nonconfidential basis prior to your disclosure. 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.

The reimbursement and indemnification provisions and your confidentiality
provisions contained herein and in the Fee Letter shall remain in full force and
effect regardless of whether definitive financing documentation shall be
executed and delivered and notwithstanding the termination of this Commitment
Letter, provided, that your obligations under this Commitment Letter shall
automatically terminate and be superseded by the provisions of the definitive
documentation relating to the Facility upon the initial funding thereunder, and
you shall automatically be released from all liability in connection therewith
at such time. Our confidentiality obligations shall automatically terminate and
be superseded by the provisions of the definitive documentation relating to the
Facility, provided, that, if no such Facility documentation is entered into, our
obligations shall survive the termination of this Commitment Letter for a period
of one year from the date of this Commitment Letter.

We hereby notify the Company that, pursuant to the requirements of the USA
PATRIOT ACT, Title III of Pub. L. 107-56 (signed into law October 26, 2001) (the
“Patriot Act”), each Lender (including us) is required to obtain, verify and
record information that identifies the Company, which information includes the
name, address, tax identification number and other information regarding said
parties that will allow the Arranger and each Lender to identify the Company in
accordance with the Patriot Act and determine that the Company is an acceptable
borrower. This notice is given in accordance with the requirements of the
Patriot Act and is effective as to the Arranger and each Lender.

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Magellan Midstream Partners, L.P.

Commitment Letter

July 12, 2010

Page 6

 

This Commitment Letter shall be construed in accordance with, and this
Commitment Letter and all matters arising out of or relating in any way
whatsoever to it (whether in contract, tort or otherwise) shall be governed by,
the law of the State of New York. Each of the parties hereto hereby irrevocably
and unconditionally (a) submits, for itself and its property, to the
non-exclusive jurisdiction of any New York State court or Federal court of the
United States of America sitting in New York County, and any appellate court
from any thereof, in any action or proceeding arising out of or relating to this
Commitment Letter or the transactions contemplated hereby, and agrees that all
claims in respect of any such action or proceeding may be heard and determined
only in such New York State court or, to the extent permitted by law, in such
Federal court, (b) waives, to the fullest extent it may legally and effectively
do so, any objection which it may now or hereafter have to the laying of venue
of any suit, action or proceeding arising out of or relating to this Commitment
Letter or the transactions contemplated hereby in any such New York State court
or in any such Federal court, (c) waives, to the fullest extent permitted by
law, the defense of an inconvenient forum to the maintenance of such action or
proceeding in any such court, and (d) agrees that a final judgment in any such
action or proceeding shall be conclusive and may be enforced in other
jurisdictions by suit on the judgment or in any other manner provided by law.
Service of any process, summons, notice or document by registered mail addressed
to you at your address above and, in the case of the Arranger or any Lender, at
its address provided to you shall be effective service of process against such
party for any suit, action or proceeding brought in any such court. The Company
hereby agrees to commence any such action, suit, proceeding or claim either in
the United States District Court for the Southern District of New York or in the
Supreme Court of the State of New York, New York County located in the Borough
of Manhattan. EACH OF THE PARTIES HERETO IRREVOCABLY WAIVES THE RIGHT TO TRIAL
BY JURY IN ANY ACTION, PROCEEDING, CLAIM OR COUNTERCLAIM BROUGHT BY OR ON BEHALF
OF ANY PARTY RELATED TO OR ARISING OUT OF THIS COMMITMENT LETTER OR THE
PERFORMANCE OF SERVICES HEREUNDER.

In connection with all aspects of each transaction contemplated by this
Commitment Letter, you acknowledge and agree that: (a) (i) the arranging and
other services described herein regarding the Facility are arm’s-length
commercial transactions between you and your affiliates, on the one hand, and
the Arranger and the Lenders on the other hand, (ii) you have consulted your own
legal, accounting, regulatory and tax advisors to the extent you have deemed
appropriate, and (iii) you are capable of evaluating, and understand and accept,
the terms, risks and conditions of the transaction contemplated hereby;
(b) (i) the Arranger and the Lenders each have been, is, and will be acting
solely as a principal and, except as otherwise expressly agreed in writing by
the relevant parties, has not been, is not, and will not be acting as an
advisor, agent or fiduciary for you, any of your affiliates or any other person
or entity and (ii) none of the Joint Arranger or the Lenders has any obligation
to you or your affiliates with respect to the transactions contemplated hereby
except those obligations expressly set forth herein; and (c) the Arranger and
the Lenders and their respective affiliates may be engaged in a broad range of
transactions that involve interests that differ from yours and those of your
affiliates, the Arranger and the Lenders have no obligation to disclose any of
such interests to you or your affiliates. To the fullest extent permitted by
law, you hereby waive and release any claims that you may have against the
Arranger and Lenders with respect to any breach or alleged breach of agency or
fiduciary duty in connection with any aspect of any transaction contemplated by
this Commitment Letter.

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Magellan Midstream Partners, L.P.

Commitment Letter

July 12, 2010

Page 7

 

If the foregoing correctly sets forth our agreement, please indicate your
acceptance of the terms hereof and of the Term Sheet and the Fee Letter by
returning to the parties hereto and thereto executed counterparts hereof and of
the Fee Letter not later than 5:00 p.m., Houston, Texas time, on July 6, 2010.
The Commitments of the Lenders and the agreements of the Arranger herein will
expire at such time in the event JPM Securities has not received such executed
counterparts in accordance with the immediately preceding sentence.

The Arranger and the Lenders are pleased to have been given the opportunity to
assist you in connection with this important financing.

 

Very truly yours,

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JPMORGAN CHASE BANK, N. A. By:  

/s/ Kenneth J. Fatur

Name:   Kenneth J. Fatur Title:   Managing Director JPMORGAN SECURITIES INC By:
 

/s/ Kenneth J. Fatur

Name:   Kenneth J. Fatur Title:   Managing Director

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BANK OF AMERICA, N.A. By:  

/s/ W. W. Stevenson

Name:   William W. Stevenson Title:   Vice President

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MORGAN STANLEY SENIOR FUNDING, INC. By:  

/s/ Dawn D. Clark

Name:   Dawn D. Clark Title:   Authorized Signatory

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WELLS FARGO BANK, NATIONAL ASSOCIATION By:  

/s/ Paul V. Farrell

Name:   Paul V. Farrell Title:   Director

 

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ACCEPTED and agreed to as of the date first above written by:

 

MAGELLAN MIDSTREAM PARTNERS, L.P. By:   Magellan GP, LLC,   its General Partner
  By:  

/s/ John D. Chandler

  Name:   John D. Chandler   Title:   Chief Financial Officer & Treasurer