Exhibit
4.8


 


GIBSON ENERGY HOLDING ULC

as
Guarantor


 


and


 


THE BANK OF NEW YORK MELLON

as Trustee


 


and


 


BNY TRUST COMPANY OF CANADA

as Collateral Agent


 


and


 


THE NOTEHOLDERS

as other
Secured Creditors


 






 


GUARANTEE – PARENT


 


May 27,
2009


 






 


STIKEMAN ELLIOTT LLP


 

















 


TABLE OF CONTENTS


 


	
  ARTICLE 1

  INTERPRETATION

  
	
   

  
	
  Section 1.1

  	
  Defined Terms

  	
  1

  
	
  Section 1.2

  	
  Interpretation

  	
  4

  
	
   

  
	
  ARTICLE 2

  GUARANTEE

  
	
   

  
	
  Section 2.1

  	
  Guarantee

  	
  5

  
	
  Section 2.2

  	
  Primary Note Obligation

  	
  5

  
	
  Section 2.3

  	
  Absolute Liability

  	
  5

  
	
   

  	
   

  	
   

  
	
  ARTICLE 3

  ENFORCEMENT

  
	
   

  
	
  Section 3.1

  	
  Remedies

  	
  7

  
	
  Section 3.2

  	
  Amount of Note Obligations

  	
  7

  
	
  Section 3.3

  	
  Payment on Demand

  	
  7

  
	
  Section 3.4

  	
  Suspension of Guarantor Rights

  	
  8

  
	
  Section 3.5

  	
  No Prejudice to Secured Creditors or Trustee

  	
  8

  
	
  Section 3.6

  	
  Rights of Subrogation

  	
  8

  
	
  Section 3.7

  	
  No Set-off

  	
  9

  
	
  Section 3.8

  	
  Successors of the Issuers

  	
  9

  
	
  Section 3.9

  	
  Continuing Guarantee and Continuing Note Obligations

  	
  9

  
	
  Section 3.10

  	
  Supplemental Security

  	
  9

  
	
  Section 3.11

  	
  Security for Guarantee

  	
  9

  
	
  Section 3.12

  	
  Interest Act (Canada)

  	
  10

  
	
  Section 3.13

  	
  Taxes

  	
  10

  
	
  Section 3.14

  	
  Judgment Currency

  	
  12

  
	
   

  	
   

  	
   

  
	
  ARTICLE 4

  GENERAL

  
	
   

  
	
  Section 4.1

  	
  Notices, etc.

  	
  12

  
	
  Section 4.2

  	
  No Merger, Survival of Representations and Warranties

  	
  12

  
	
  Section 4.3

  	
  Further Assurances

  	
  12

  
	
  Section 4.4

  	
  Successors and Assigns

  	
  13

  
	
  Section 4.5

  	
  Amendment

  	
  13

  
	
  Section 4.6

  	
  Waivers, etc.

  	
  13

  
	
  Section 4.7

  	
  Severability

  	
  13

  
	
  Section 4.8

  	
  Enforcement

  	
  14

  
	
  Section 4.9

  	
  Application of Proceeds

  	
  14

  
	
  Section 4.10

  	
  Governing Law

  	
  14

  



 


i

















 


	
  Section 4.11

  	
  General Limitation on Guarantee Obligations

  	
  14

  
	
  Section 4.12

  	
  Release of the Guarantor

  	
  15

  
	
  Section 4.13

  	
  Business Corporations Act

  	
  15

  
	
   

  	
   

  	
   

  
	
  SCHEDULES

  
	
   

  
	
  SCHEDULE “A”

  	
  GUARANTOR SECURITY DOCUMENTS

  	
   

  
				



 


ii

















 


GUARANTEE – PARENT


 


Guarantee dated as of May 27, 2009 made by Gibson Energy Holding
ULC, to and in favour
of The Bank of New York Mellon, as Trustee, BNY Trust Company of Canada, as
Collateral Agent and the other Secured Creditors.


 


RECITALS:


 


(a)                                  The Issuers may from time to time
issue Notes to the Noteholders pursuant to the Indenture with The Bank of New
York Mellon, as Trustee;


 


(b)                                 The Initial Purchasers have agreed
pursuant to the Note Purchase Agreement to purchase the Notes issued by the
Issuers in the aggregate principal amount of US$560,000,000 on the terms and
conditions contained in the Note Purchase Agreement;


 


(c)                                  The Guarantor will receive
substantial benefits from the issuance of the Notes under the Indenture and the
other Indenture Documents and the Guarantor is, therefore, willing to enter
into this Guarantee; and


 


(d)                                 It is a condition precedent to the
issuance of the Notes that the Guarantor unconditionally guarantee the
obligations of the Issuers under the Indenture, the Notes and the other
Indenture Documents on the terms and conditions contained in this Guarantee;


 


In consideration of the foregoing and other good and valuable
consideration, the receipt and adequacy of which are acknowledged, the
Guarantor agrees as follows:


 


ARTICLE 1

INTERPRETATION


 


Section 1.1                Defined Terms.


 


As used in this Guarantee the following terms have the following
meanings:


 


“Collateral
Agent” means BNY Trust Company of Canada, acting as collateral agent
on behalf of, inter alia, the Noteholders and
the other Secured Creditors and any successor collateral agent appointed in
accordance with the terms of the Indenture Documents, and its successors and
permitted assigns.


 


“Credit Parties” means, collectively, the Issuers and each
Guarantor (as defined in the Indenture) and “Credit Party”
means any one of them.


 


“Debentures” means, collectively, (i) the
demand debenture of even date herewith made by Gibson Energy to and in favour
of the Collateral Agent for the benefit of the Secured Creditors (as defined
therein); (ii) the demand debenture of even date herewith made by the
Subsidiary Guarantors, Link Petroleum, Inc., Gibson Energy (U.S.) Inc.,
GEP Midstream and Parent to and in favour of the Collateral Agent for the
benefit of the Secured Creditors (as


 

















 


defined therein); and (iii) any other debenture or mortgage made
by any Credit Party to and in favour of the Collateral Agent in connection with
the Indenture.


 


“GEP Midstream” means GEP Midstream
Finance Corp., a corporation incorporated and existing under the laws of
Alberta, and its successors and permitted assigns.


 


“Gibson Energy” means Gibson Energy ULC,
an unlimited liability corporation organized and existing under the laws of
Alberta, and its successors and permitted assigns.


 


“Governmental Entity” means (i) any
international, multinational, national, federal, provincial, state, municipal,
local or other governmental or public department, central bank, court,
commission, board, bureau, agency or instrumentality, domestic or foreign, (ii) any
subdivision or authority of any of the above, (iii) any stock exchange and
(iv) any quasi-governmental or private body exercising any regulatory,
expropriation or taxing authority under or for the account of any of the above.


 


“Guarantee”
means this guarantee.


 


“Guarantor Security Documents”  at any time
means, in respect of the Guarantor, the agreements described in Schedule “A” and any other security held by the Collateral Agent
and the Secured Creditors, or any one of them, from time to time for the
Guarantor’s obligations under this Guarantee and the other Indenture Documents
to which it is a party.


 


“Guarantor”
means the Parent.


 


“Indenture”
means the indenture dated as of May 27, 2009 among the Issuers, the
Trustee, the Collateral Agent, the Parent, the Subsidiary Guarantors and the
U.S. Guarantors (as defined therein) party thereto, as the same may be amended,
modified, extended, renewed, replaced, restated, supplemented or refinanced
from time to time and includes any agreement extending the maturity of,
refinancing or restructuring all or any portion of, the indebtedness under such
agreement or any successor agreements, whether or not with the same Trustee or
Noteholders.


 


“Indenture
Documents” means, collectively, the Indenture, the Notes, the
Intercreditor Agreement, this Guarantee, the Debentures, the Guarantor Security
Documents, the Registration Rights Agreement , the Security Agreements and each
other Collateral Document.


 


“Initial Purchasers” means UBS
Securities LLC, RBS Securities Inc. d/b/a RBS and RBC Capital Markets
Corporation and their respective successors and permitted assigns.


 


“Issuers” means, collectively, Gibson  Energy and GEP Midstream.


 


“Noteholder”
means a
Person in whose name a Note is registered in the register maintained by the
Registrar pursuant to the Indenture.


 


“Note Obligations” means, collectively, (a) the
Obligations of each Issuer and each other Credit Party from time to time
arising under or in respect of the Indenture, the Notes and


 


2

















 


the other Indenture Documents and whether incurred by such Issuer or
such other Credit Party alone or jointly with another or others and whether as
principal, guarantor or surety and in whatever name or style and whether in its
own personal capacity or in its capacity as a partner, general partner or
managing partner of any Partnership Obligor in which it is a partner, general
partner or managing partner, as applicable; (b) all other monetary
obligations, including fees, costs, expenses and indemnities, whether primary,
secondary, direct, contingent, fixed or otherwise (including monetary
obligations incurred during the pendency of any bankruptcy, insolvency,
receivership or other similar proceeding, regardless of whether allowed or
allowable in such proceeding), of each Issuer and each other Credit Party under
the Indenture, the Notes and the other Indenture Documents and whether incurred
by such  Issuer or such other Credit
Party alone or jointly with another or others and whether as principal,
guarantor or surety and in whatever name or style and whether in its own
personal capacity or in its capacity as partner, general partner or managing
partner of any Partnership Obligor in which it is a partner, general partner or
managing partner, as applicable; and (c) the due and punctual performance
of all covenants, agreements, obligations and liabilities of Issuers and each
other Credit Party under or pursuant to the Indenture, the Notes and the other
Indenture Documents.


 


“Note Purchase Agreement” means the
purchase agreement dated as of May 21, 2009 among the Issuers, Parent and
the Initial Purchasers.


 


“Notes” means the notes issued and
outstanding under the Indenture at any time and from time to time, including
Initial Notes, Additional Notes and Exchange Notes.


 


“Obligation” means any principal,
interest (including any interest accruing subsequent to the filing of a
petition in bankruptcy, reorganization or similar proceeding at the rate
provided for in the documentation with respect thereto, whether or not such
interest is an allowed claim under applicable state, federal or foreign law),
penalties, fees, indemnifications, reimbursements (including reimbursement obligations
with respect to letters of credit and banker’s acceptances), damages and other
liabilities, and guarantees of payment of such principal, interest, penalties,
fees, indemnifications, reimbursements, damages and other liabilities, payable
under the documentation governing any Indebtedness.


 


“Original Currency” has the meaning
ascribed to it in Section 3.14.


 


“Other Currency” has the meaning
ascribed to it in Section 3.14.


 


“Parent” means Gibson Energy Holding ULC, an unlimited
liability corporation incorporated and existing under the laws of Alberta, and
its successors and permitted assigns.


 


“Partnership Obligor” means, collectively,
each of Moose Jaw Refinery Partnership, CanWest Propane Partnership, MP Energy
Partnership, Gibson Energy Partnership, Battle River Terminal LP and each other
partnership which at any time and from time to time becomes a Credit Party and “Partnership Obligor” means any one of them.


 


3

















 


“Registration Rights Agreement” means
the registration rights agreement dated as of May 27, 2009 by and among
Gibson Energy, GEP Midstream, each of the Guarantors (as defined therein) and
the Initial Purchasers.


 


“Secured
Creditors” means the Trustee, the Collateral Agent and the
Noteholders at any time and from time to time, and for greater clarity, do not
include the Additional Secured Creditors (as defined in the Security Agreements
and the Debentures).


 


“Security Agreements” means, collectively, (i) the
security agreement of even date herewith made by Gibson Energy, GEP Midstream
and Parent to and in favour of Collateral Agent for the benefit of the Secured Creditors
(as defined therein) and (ii) the security agreement of even date herewith
made by the Subsidiary Guarantors, Link Petroleum, Inc. and Gibson Energy
(U.S.) Inc. to and in favour of Collateral Agent for the benefit of the Secured
Creditors (as defined therein).


 


“Subsidiary Guarantors”  means, collectively, Moose Jaw Refinery Partnership, Moose
Jaw Refinery ULC, CanWest Propane Partnership, CanWest Propane ULC, MP Energy
Partnership, MP Energy ULC, Gibson Energy Partnership, GEP ULC, Link Petroleum Services
Ltd., Chief Hauling Contractors ULC, Gibson GCC Inc., Battle River Terminal GP
Inc., Battle River Terminal LP and Bridge Creek Trucking Ltd.


 


“Trustee” means The Bank of New York
Mellon, acting as trustee for the Noteholders and any successor trustee
appointed under the Indenture
and its successors and permitted assigns


 


Section 1.2                Interpretation.


 


(1)           Capitalized terms used in this Guarantee but
not defined have the meanings given to them in the Indenture.


 


(2)           In this Guarantee the words “including”, “includes” and “include” mean “including (or includes or
include) without limitation”. 
The phrase “the aggregate of”,
“the total of”, “the sum of”,
or a phrase of similar meaning means “the aggregate (or total
or sum), without duplication, of”. 
The expression “Article”, “Section” or other subdivision followed by a number mean and
refer to the specified Article, Section or other subdivision of this
Guarantee.


 


(3)           Any reference in this Guarantee to gender
includes all genders.  Words importing
the singular number only include the plural and vice versa.


 


(4)           The division of this Guarantee into Articles,
Sections and other subdivisions and the insertion of headings are for
convenient reference only and are not to affect its interpretation.


 


(5)           The schedules attached to this Guarantee form
an integral part of it for all purposes of it.


 


(6)           Any reference to this Guarantee, any
Guarantor Security Document or any other Indenture Document refers to this
Guarantee or such Guarantor Security Document 


 


4

















 


or such other Indenture Document as the same may have been or may from
time to time be amended, modified, extended, renewed, restated, replaced or
supplemented and includes all schedules to it. 
Any reference in this Guarantee to a statute refers to such statute and
all rules and regulations made under it as the same may have been or may
from time to time be amended or re-enacted.


 


(7)           All references in this Guarantee to dollars,
unless otherwise specifically indicated, are expressed in currency of the
United States of America.


 


ARTICLE 2

GUARANTEE


 


Section 2.1                Guarantee.


 


The Guarantor irrevocably and unconditionally, guarantees to each of
the Secured Creditors the due and punctual payment, and the due performance,
whether at stated maturity, by acceleration or otherwise, of the Note
Obligations.  The Guarantor agrees that
the Note Obligations will be paid to the Trustee and the other Secured
Creditors strictly in accordance with their terms and conditions.  The Trustee may enforce this Guarantee
against the Guarantor for the benefit of the Trustee and the other Secured
Creditors up to the full amount of the Note Obligations without proceeding
against any Issuer or any Collateral Document.


 


Section 2.2                Primary Note Obligation


 


If any or all of the Note Obligations are not duly performed by any
Issuer and are not performed by the Guarantor under Section 2.1 for any
reason whatsoever, such Note Obligations will, as a separate and distinct
obligation, be performed by the Guarantor as primary obligor.


 


Section 2.3                Absolute Liability.


 


The Guarantor agrees that the liability of the Guarantor under Section 2.1
and Section 2.2, is absolute and unconditional irrespective of:


 


(a)                                  the lack of validity or
enforceability of any terms of any of the Indenture Documents;


 


(b)                                 any contest by any Issuer or any
other Person as to the amount of the Note Obligations, the validity or
enforceability of any terms of the Indenture Documents or the perfection or
priority of any security granted to the Trustee or the other Secured Creditors;


 


(c)                                  any defence, counter claim or
right of set-off available to any Issuer (other than payment in full of the
Note Obligations);


 


(d)                                 any release, compounding or other
variance of the liability of any Issuer or any other Person liable in any
manner under or in respect of the Note Obligations or the extinguishment of all
or any part of the Note Obligations by operation of law (other than payment in
full of the Note Obligations);


 


5

















 


(e)                                  any change in the time or times
for, or place or manner or terms of payment or performance of the Note
Obligations or any consent, waiver, renewal, alteration, extension, compromise,
arrangement, concession, release, discharge or other indulgences which any
Secured Creditors or the Trustee on behalf of the Secured Creditors may grant
to any Issuer or any other Person;


 


(f)                                    any amendment or supplement to, or
alteration or renewal of, or restatement, replacement, refinancing or modification
or variation of (including any additional Note issuances thereunder or the
inclusion of an additional Issuer thereunder), or other action or inaction
under, the Indenture, the other Indenture Documents or any other related
document or instrument, or the Note Obligations;


 


(g)                                 any discontinuance, termination,
reduction, renewal, increase, abstention from renewing or other variation of
any credit or credit facilities to, or the terms or conditions of any
transaction with, any Issuer or any other Person;


 


(h)                                 any change in the ownership,
control, name, objects, businesses, assets, capital structure or constitution
of any Issuer, the Guarantor or any other Credit Party or any reorganization
(whether by way of reconstruction, consolidation, amalgamation, merger,
transfer, sale, lease or otherwise) of any Issuer, the Guarantor or any other
Credit Party or their respective businesses;


 


(i)                                     any dealings with the security
which any Secured Creditor or the Trustee on behalf of the Secured Creditors
holds or may hold pursuant to the terms and conditions of the Indenture
Documents, including the taking, giving up or exchange of securities, their
variation or realization, the accepting of compositions and the granting of
releases and discharges;


 


(j)                                     any limitation of status or power,
disability, incapacity or other circumstance relating to any Issuer, the
Guarantor, any other Credit Party or any other Person, including any
bankruptcy, insolvency, reorganization, composition, adjustment, dissolution,
liquidation, winding-up or other like proceeding involving or affecting any
Issuer, the Guarantor, any other Credit Party or any other Person or any action
taken with respect to this Guarantee by any trustee or receiver, or by any
court, in any such proceeding, whether or not any the Guarantor shall have
notice or knowledge of any of the foregoing;


 


(k)                                  the assignment by any Secured
Creditor of all or any part of the benefits of this Guarantee;


 


(l)                                     any impossibility,
impracticability, frustration of purpose, force majeure  or illegality of any Indenture Document, or
the occurrence of any change in the laws, rules, regulations or ordinances of
any jurisdiction or by any present or future action of (i) any
Governmental Entity that amends, varies, reduces or otherwise affects, or
purports to amend, vary, reduce or otherwise affect, any 


 


6

















 


of the Note Obligations or the obligations of the Guarantor under this
Guarantee, or (ii) any court order that amends, varies, reduces or otherwise
affects any of the Note Obligations;


 


(m)                               any taking or failure to take
security, any loss of, or loss of value of, any security, or any invalidity,
non-perfection or unenforceability of any security held by any Secured
Creditors or the Trustee on behalf of the Secured Creditors, or any exercise or
enforcement of, or failure to exercise or enforce, security, or irregularity or
defect in the manner or procedure by which the Trustee or any other Secured
Creditor realizes on such security;


 


(n)                                 any application of any sums
received to the Note Obligations (other than payment in full of the Note
Obligations), or any part thereof, and any change in such application; and


 


(o)                                 any other circumstances which
might otherwise constitute a defence available to, or a discharge of, the
Guarantor, any Issuer or any other Person in respect of the Note Obligations or
this Guarantee.


 


ARTICLE 3

ENFORCEMENT


 


Section 3.1                Remedies.


 


None of the Secured Creditors nor the Trustee on behalf of the Secured
Creditors is bound to exhaust its recourse against any Issuer or any other
Person or realize on any security it may hold in respect of the Note
Obligations before being entitled to (i) enforce payment and performance
under this Guarantee or (ii) pursue any other remedy against the
Guarantor, and the Guarantor renounces all benefits of discussion and division.


 


Section 3.2                Amount of Note Obligations.


 


Any account settled or stated by or between the Trustee and the
Issuers, or if any such account has not been settled or stated immediately
before demand for payment under this Guarantee, any account stated by the
Trustee shall, in the absence of manifest mathematical error, be accepted by
the Guarantor as presumptively correct evidence of the amount of the Note
Obligations which is due by the Issuers to the Secured Creditors or remains
unpaid by the Issuers to the Secured Creditors.


 


Section 3.3                Payment on Demand.


 


The Guarantor will pay and perform the Note Obligations and pay all
other amounts payable by it to the Secured Creditors or the Trustee on behalf
of the Secured Creditors under this Guarantee, and the obligation to do so
arises, immediately after demand for such payment or performance is made in
writing to it.  The liability of the
Guarantor bears interest from the date of such demand at the rate or rates of
interest then applicable to the Note Obligations under and calculated in the
manner provided in the Indenture Documents (including any adjustment to give
effect to the provisions of the Interest Act (Canada)).


 


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Section 3.4                Suspension of Guarantor Rights.


 


So long as there are any Note Obligations, the Guarantor will not
exercise any rights which it may at any time have by reason of the performance
of any of its obligations under this Guarantee (i) to be indemnified by
any Issuer, (ii) to claim contribution from any other guarantor of the
debts, liabilities or obligations of any Issuer, or (iii) subject to Section 3.6,
to take the benefit (in whole or in part and whether by way of subrogation or
otherwise) of any rights of the Secured Creditors or the Trustee under any of
the Indenture Documents.


 


Section 3.5                No Prejudice to Secured Creditors or Trustee.


 


None of the Secured Creditors nor the Trustee on behalf of the Secured
Creditors are prejudiced in any way in the right to enforce any provision of
this Guarantee by any act or failure to act on the part of the Issuers, the
Secured Creditors or the Trustee on behalf of the Secured Creditors.  The Trustee and the other Secured Creditors
may, at any time and from time to time, in such manner as any of them may
determine is expedient, without any consent of, or notice to, the Guarantor and
without impairing or releasing the obligations of the Guarantor (i) change
the manner, place, time or terms of payment or performance of the Note
Obligations, (ii) renew or alter the Note Obligations, (iii) amend,
vary, modify, supplement or replace any Indenture Document or any other related
document or instrument, (iv) discontinue, reduce, renew, increase, abstain
from renewing or otherwise vary any credit or credit facilities to, any
transaction with, any Issuer or any other Person, (v) release, compound or
vary the liability of any Issuer or any other Person liable in any manner under
or in respect of the Note Obligations, (vi) take or abstain from taking
securities or collateral from any other Person, or from perfecting securities
or collateral of any other Person, (vii) exercise or enforce or refrain
from exercising or enforcing any right or security against any Issuer, the
Guarantor or any other Person, (viii) accept compromises or arrangement
from any Person, (ix) apply any sums from time to time received to the
Note Obligations, or any part thereof, and change any such application in whole
or in part from time to time, (x) otherwise deal with, or waive or modify
their right to deal with, any Person and security, in each case, in accordance
with the Indenture Documents, if applicable. 
In their dealings with the Issuers, the Trustee and the other Secured
Creditors need not enquire into the authority or power of any Person purporting
to act for or on behalf of the Issuers.


 


Section 3.6                Rights of Subrogation.


 


Any rights of subrogation acquired by the Guarantor by reason of
payment under this Guarantee shall not be exercised until the Note Obligations
(other than contingent indemnity obligations)  have
been paid or repaid in full and such rights of subrogation shall be no greater
than the rights held by the Trustee and the other Secured Creditors.  In the event (i) of the liquidation, winding
up or bankruptcy of any Credit Party (whether voluntary or compulsory), (ii) that
any Credit Party makes a bulk sale of any of its assets within the provisions
of any bulk sales legislation, or (iii) that any Credit Party makes any
composition with creditors or enters into any scheme of arrangement, the
Trustee and the other Secured Creditors have the right to rank in priority to
the Guarantor for their full claims in respect of the Note Obligations and
receive all dividends and other payments until their claims have been paid in
full.  The Guarantor will continue to be
liable, less any payments made by it, for any balance which may be owing to the
Secured Creditors by the Issuers.  No
valuation or retention of their security by the Secured Creditors or the
Trustee 


 


8

















 


on behalf of the Secured Creditors shall, as between any Credit Party,
the Trustee and the other Secured Creditors and the Guarantor, be considered as
a purchase of such security or as payment or satisfaction or reduction of all
or any part of the Note Obligations.  If
any amount is paid to the Guarantor in violation of this Section at any
time when all the Note Obligations (other than contingent indemnity
obligations) have not been paid in full, the amount will be held in trust for
the benefit of the Trustee on behalf of the Secured Creditors and immediately
paid to the Trustee to be credited and applied to the Note Obligations, whether
matured or unmatured.  The Guarantor does
not have any recourse against any Secured Creditor for any invalidity,
non-perfection or unenforceability of any security held by the Secured
Creditors or the Trustee on behalf of the Secured Creditors or any irregularity
or defect in the manner or procedure by which the Secured Creditors or the
Trustee realize on such security.


 


Section 3.7                No Set-off.


 


To the fullest extent permitted by law, the Guarantor makes all
payments under this Guarantee without regard to any defence, counter-claim or
right of set-off available to it.


 


Section 3.8                Successors of the Issuers.


 


This Guarantee will not be revoked by any change in the constitution of
any Credit Party.


 


Section 3.9                Continuing Guarantee and Continuing Note Obligations.


 


The obligation of the Guarantor under Section 2.1 is a continuing
guarantee, and the obligation of the Guarantor under Section 2.2 is a
continuing obligation.  Each of Section 2.1
and Section 2.2 extends to all present and future Note Obligations,
applies to and secures the ultimate balance of the Note Obligations due or
remaining due to the Trustee and the other Secured Creditors (other than
contingent indemnity obligations)  and is binding
as a continuing obligation of the Guarantor until the Trustee on behalf of the
Secured Creditors releases the Guarantor, or until payment in full of the Note
Obligations (other than contingent indemnity obligations).  This Guarantee will continue to be effective
or be reinstated, as the case may be, if at any time any payment of any of the
Note Obligations is rescinded or must otherwise be returned by any Secured
Creditors upon the insolvency, bankruptcy or reorganization of any Issuer or
otherwise, all as though the payment had not been made.


 


Section 3.10             Supplemental Security.


 


This Guarantee is in addition and without prejudice to and supplemental
to all other guarantees, indemnities, obligations and security now held or
which may hereafter be held by any Secured Creditor or the Trustee on behalf of
the Secured Creditors.


 


Section 3.11             Security for Guarantee.


 


The Guarantor acknowledges that this Guarantee is intended to secure
payment and performance of the Note Obligations and that the payment and
performance of the Note Obligations and the other obligations of the Guarantor
under this Guarantee are secured pursuant to the terms and provisions of the
Guarantor Security Documents.


 


9

















 


Section 3.12             Interest Act (Canada).


 


The Guarantor acknowledges that certain of the rates of interest
applicable to the Note Obligations may be computed on the basis of a year of
360 days or 365 days, as the case may be and paid for the actual number of days
elapsed.  For purposes of the Interest Act
(Canada), whenever any interest is calculated using a rate based on a year of
360 days or 365 days, as the case may be, such rate determined pursuant to such
calculation, when expressed as an annual rate is equivalent to (i) the
applicable rate based on a year of 360 days or 365 days, as the case may be, (ii) multiplied
by the actual number of days in the calendar year in which the period for such
interest is payable (or compounded) ends, and (iii) divided by 360 or 365,
as the case may be.


 


Section 3.13             Taxes.


 


(1)           All payments made by the Guarantor under this
Guarantee or under any of the Guarantor Security Documents will be made free
and clear of and without withholding or deduction for or on account of any
present or future Taxes imposed or levied by or on behalf of any Taxing
Authority in the Relevant Taxing Jurisdiction, unless the Guarantor is required
to withhold or deduct Taxes by law or by the interpretation or administration
thereof.  If the Guarantor is required to
withhold or deduct any amount for or on account of Taxes imposed by a Relevant
Taxing Jurisdiction, from any payment made under or with respect to this
Guarantee or under any of the Guarantor Security Documents, the Guarantor will
pay as additional interest the Additional Amounts as may be necessary so that
the net amount received by each Noteholder (including Additional Amounts) after
such withholding or deduction will equal the amount the Noteholder would have received
if such Taxes had not been withheld or deducted; provided, however, that no
Additional Amounts will be payable with respect to any Tax that would not have
been imposed, payable or due:


 


(a)                                  but for the Noteholder or
beneficial owner of Notes not dealing at arm’s length with the Guarantor (for
purposes of the Income Tax Act (Canada)) at the
time of the making of such payment;


 


(b)                                 but for the existence of any present
or former connection between the Noteholder (or the beneficial owner of, or
person ultimately entitled to obtain an interest in, such Notes, including a
fiduciary, settler, beneficiary, member, partner, shareholder or other equity
interest owner of, or possessor of power over, such Noteholder or beneficial
owner, if such Noteholder or beneficial owner is an estate, trust, partnership,
limited liability company, corporation or other entity) and the Relevant Taxing
Jurisdiction (including being a citizen or resident or national of, or carrying
on a business or maintaining a permanent establishment in, or being physically
present in, the Relevant Taxing Jurisdiction) other than the mere holding of
the Notes or enforcement of rights thereunder or the receipt of payments in
respect thereof; or


 


(c)                                  but for the failure by the
Noteholder to satisfy any certification, identification, information,
documentation or other reporting requirements concerning the nationality,
residence, identity or connection with the 


 


10

















 


Relevant Taxing Jurisdiction or arm’s-length relationship with the
Guarantor of the Holder or beneficial owner or otherwise establishing the right
to the benefit of an exemption from, or reduction in the rate of, withholding
or deduction, if (a) such compliance is required by law, regulation,
administrative practice or an applicable treaty of the Relevant Taxing
Jurisdiction as a precondition to exemption from, or a reduction in the rate of
deduction of withholding of, such Taxes and (b) the Guarantor have
provided the Trustee with thirty (30) days’ prior written notice of such requirement.


 


(2)           Additional Amounts will not be payable if the
beneficial owner of, or person ultimately entitled to obtain an interest in,
such Notes is not the sole beneficial owner of such payments, or is a fiduciary
or partnership (including any entity or arrangement treated as a partnership by
the Relevant Taxing Jurisdiction), to the extent that any beneficial owner,
beneficiary or settler with respect to such fiduciary or any partner or member
of such partnership would not have been entitled to such Additional Amounts
with respect to such payments had such beneficial owner, beneficiary, settler,
partner or member received directly its beneficial or distributive shares of
such payments.  In addition, Additional
Amounts will not be payable with respect to (i) any Tax which is payable
otherwise than by withholding from payments of, or in respect of principal of,
or any interest on, the Notes, this Guarantee or any of the Guarantor Security
Documents, (ii) any withholding or deduction that relates to any estate,
inheritance, gift or similar tax, duty, assessment or governmental charge, (iii) any
withholding or deduction imposed on a payment to an individual and required to
be made pursuant to European Union Directive on the taxation of savings income
which was adopted by the ECOFIN Council (the Council of EU Finance and Economic
Ministers), or any law implementing or complying with, or introduced to conform
to, such directive, or pursuant to related measures entered into on a
reciprocal basis between member states of the European Union and certain
non-European Union countries and dependent or associated territories and (iv) any
Tax imposed or levied by, or on behalf of, the United States of America or any
State or other political subdivision thereof.


 


(3)           Whenever in this Guarantee or any of the
Guarantor Security Documents there is mentioned, in any context, the payment of
Note Obligations or other amounts based upon the principal amount of the Notes
or of principal, interest or of any other amount payable under or with respect
to any of the Notes, such mention shall be deemed to include mention of the
payment of Additional Amounts to the extent that, in such context, Additional
Amounts are, were or would be payable in respect thereof.


 


(4)           Upon request, the Guarantor will provide the
Trustee with documentation satisfactory to the Trustee evidencing the payment
of Additional Amounts.


 


(5)           The Guarantor will pay any present or future
stamp, court or documentary taxes, or any other excise or property taxes,
charges or similar levies which arise in a Relevant Taxing Jurisdiction from
the execution, delivery or registration of the Notes, this 


 


11

















 


Guarantee or under any of the Guarantor Security Documents and any such
taxes, charges or similar levies imposed by any jurisdiction resulting from, or
required to be paid in connection with the enforcement of the Notes, this
Guarantee or under any of the Guarantor Security Documents or any other such
document or instrument following the occurrence of any Event of Default with
respect to the Notes.


 


(6)           The provisions of this Section 3.13
survive the termination of this Guarantee.


 


Section 3.14             Judgment Currency.


 


(1)           If for the purposes of obtaining judgment in
any court it is necessary to convert all or any part of the Note Obligations or
any other amount due to a Secured Creditor in respect of the Guarantor’s
obligations under this Guarantee in any currency (the “Original
Currency”) into another currency (the “Other
Currency”), the Guarantor, to the fullest extent that it may
effectively do so, agrees that the rate of exchange used shall be that at
which, in accordance with normal banking procedures, the Secured Creditor could
purchase the Original Currency with the Other Currency on the Business Day
preceding that on which final judgment is paid or satisfied.


 


(2)           The obligations of the Guarantor in respect
of any sum due in the Original Currency from it to any Secured Creditor shall,
notwithstanding any judgment in any Other Currency, be discharged only to the
extent that on the Business Day following receipt by such Secured Creditor of
any sum adjudged to be so due in such Other Currency such Secured Creditor may,
in accordance with its normal banking procedures, purchase the Original
Currency with such Other Currency.  If
the amount of the Original Currency so purchased is less than the sum originally
due to the Secured Creditor in the Original Currency, the Guarantor agrees, as
a separate obligation and notwithstanding any such judgment, to indemnify the
Secured Creditor against such loss, and if the amount of the Original Currency
so purchased exceeds the sum originally due to the Secured Creditor in the
Original Currency, the Secured Creditor agrees to remit such excess to the
Guarantor.


 


ARTICLE 4

GENERAL


 


Section 4.1                Notices, etc.


 


Any notices, directions or other communications provided for in this
Guarantee must be in writing and given in accordance with the Indenture.


 


Section 4.2                No Merger, Survival of Representations and Warranties.


 


The covenants of the Guarantor in this Guarantee survive the execution
and delivery of this Guarantee and the issuance of Notes under the
Indenture.  Notwithstanding any
investigation made by or on behalf of the Trustee or the other Secured
Creditors, the covenants in this Guarantee continue in full force and effect.


 


Section 4.3                Further Assurances.


 


(1)           The Guarantor will do all acts and things and
execute and deliver, or cause to be executed and delivered, all documents and
instruments that the Trustee may 


 


12

















 


reasonably request to give full effect to this Guarantee and to perfect
and preserve the rights and powers of the Trustee and the other Secured
Creditors under this Guarantee, including any acknowledgements and
confirmations of this Guarantee and the Guarantor Security Documents.


 


(2)           The Guarantor acknowledges and confirms that
the Guarantor itself has established its own adequate means of obtaining from
each Issuer on a continuing basis all information desired by the Guarantor
concerning the financial condition of such Issuer and that the Guarantor will look
to such Issuer and not to the Trustee or the other Secured Creditors, in order
for the Guarantor to keep adequately informed of changes in such Issuer’s
financial condition.


 


Section 4.4                Successors and Assigns.


 


This Guarantee is binding upon the Guarantor, its successors and
assigns, and enures to the benefit of each of the Secured Creditors and each of
their respective successors permitted transferees and permitted assigns.  No other Person (including any other creditor
of the Guarantor) shall have any interest herein or any right or benefit with
respect hereto.  Without limiting the
generality of the foregoing, any Secured Creditor may assign or otherwise
transfer any indebtedness held by it secured by this Guarantee to any other
Person, and such other Person shall thereupon become vested with all the
benefits in respect thereof granted to such Secured Creditor, herein or
otherwise.  The Guarantor may not assign,
transfer or delegate any of its rights or obligations under this Guarantee
without the prior written consent of the Trustee which may be unreasonably
withheld, except pursuant to transactions permitted under the Indenture.


 


Section 4.5                Amendment.


 


This Guarantee may only be amended, supplemented or otherwise modified
by written agreement executed by the Trustee and the Guarantor.


 


Section 4.6                Waivers, etc.


 


(1)           No consent or waiver by the Trustee or the
other Secured Creditors in respect of this Guarantee is binding unless made in
writing and signed by an authorized officer of the Trustee.  Any consent or waiver given under this
Guarantee is effective only in the specific instance and for the specific
purpose for which given.  No waiver of
any of the provisions of this Guarantee constitutes a waiver of any other
provision.


 


(2)           A failure or delay on the part of the Trustee
or any other Secured Creditor in exercising a right under this Guarantee does
not operate as a waiver of, or impair, any right of the Trustee or such other
Secured Creditor however arising.  A
single or partial exercise of a right on the part of the Trustee or the other
Secured Creditors does not preclude any other or further exercise of that right
or the exercise of any other right by the Trustee or such other Secured
Creditors.


 


Section 4.7                Severability.


 


If any court of competent jurisdiction from which no appeal exists or
is taken, determines that any provision of this Guarantee is illegal, invalid
or unenforceable, that 


 


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provision will be severed from this Guarantee and the remaining
provisions will remain in full force and effect.


 


Section 4.8                Enforcement.


 


The Trustee on behalf of the Secured Creditors agrees that the
enforcement of this Guarantee is subject to the terms of the Indenture,
including Section 6.06 thereof.


 


Section 4.9                Application of Proceeds.


 


All monies collected by the Trustee or any other Secured Creditor under
this Guarantee will be applied as provided in the Indenture.  To the extent any other Indenture Document
requires proceeds of collateral under such Indenture Document to be applied in
accordance with the provisions of this Guarantee, the Trustee or holder under
such other Indenture Document shall apply such proceeds in accordance with this
Section.


 


Section 4.10             Governing Law.


 


(1)           This Guarantee will be governed by,
interpreted and enforced in accordance with the laws of the Province of Alberta
and the federal laws of Canada applicable therein.


 


(2)           The Guarantor irrevocably attorns and submits
to the exclusive jurisdiction of any court of competent jurisdiction of the
Province of Alberta sitting in Calgary, Alberta in any action or proceeding
arising out of or relating to this Guarantee and the other Indenture Documents
to which it is a party.  The Guarantor irrevocably
waives objection to the venue of any action or proceeding in such court or that
such court provides an inconvenient forum. 
Nothing in this Section limits the right of the Trustee to bring
proceedings against the Guarantor in the courts of any other jurisdiction.


 


(3)           The Guarantor hereby irrevocably
consents to the service of any and all process in any such action or proceeding
by the delivery of copies of such process to the Guarantor at the address set
forth in Section 4.1 hereof.  Nothing in this Section affects the right of
the Trustee to serve process in any manner permitted by law.


 


Section 4.11             General Limitation on Guarantee Obligations


 


In any action or proceeding involving any state corporate limited
partnership or limited liability company law, or any applicable state, federal
or foreign bankruptcy, insolvency, reorganization or other law affecting the
rights of creditors generally, if the obligations of the Guarantor under Article 2
would otherwise be held or determined to be void, voidable, invalid or
unenforceable, or subordinated to the claims of any other creditors, on account
of the amount of its liability under Article 2, then, notwithstanding any
other provision to the contrary, the amount of such liability shall, without
any further action by the Guarantor, any Credit Party or any other person, be
automatically limited and reduced to the highest amount (after giving effect to
any right of contribution established hereunder) that is valid and enforceable
and not subordinated to the claims of other creditors as determined in such
action or proceeding.


 


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Section 4.12             Release of the Guarantor.


 


The Guarantor shall be released from its obligations under this
Guarantee and its obligations under the other Indenture Documents upon payment
in full of the principal of, and accrued and unpaid interest and premium, if
any, and Additional Interest, if any, on the Notes and payment in full of all
other Note Obligations with respect to such Notes that are due and payable at
or prior to the time such principal, accrued and unpaid interest and premium
are paid.


 


Section 4.13             Business Corporations Act


 


To the extent required pursuant to Section 45 of the Business Corporations Act (Alberta), the Guarantor hereby
consents to the entering into of the transactions contemplated in the Indenture
and in this Guarantee (including the giving of guarantees and the granting of
security) by each of the other Credit Parties.


 


[Remainder of the page is
left intentionally blank]


 


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IN
WITNESS WHEREOF the Guarantor has executed this Guarantee.


 


 


	
   

  	
   

  	
  GIBSON ENERGY
  HOLDING ULC

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
  /s/ Robert M. Tichio

  
	
   

  	
   

  	
   

  	
  Authorized Signing Officer

  



 


Guarantee
- Parent


 

















 


	
  Accepted and
  Agreed:

  	
   

  
	
   

  	
   

  
	
  THE BANK OF NEW YORK MELLON, as Trustee

  	
   

  
	
   

  	
   

  
	
  By:

  	
  /s/ Lici Zhu

  	
   

  
	
   

  	
  Name:  Lici Zhu

  	
   

  
	
   

  	
  Title:  Assistant Vice President

  	
   

  



 

















 


SCHEDULE “A”

GUARANTOR SECURITY DOCUMENTS


 


1.             Security Agreement of even date herewith made by the Issuers and Parent
to and in favour of Collateral Agent for the benefit of the Secured Creditors
(as defined therein).


 


2.             Demand Debenture of even date herewith made by Parent, the Subsidiary
Guarantors, Link Petroleum, Inc., Gibson Energy (U.S.) Inc. and GEP
Midstream to and in favour of the Collateral Agent for the benefit of the
Secured Creditors (as defined therein).