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




 





 

















 


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

  
				



 


i

















 


	
  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

  



 


ii

















 


	
  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

  



 


iii

















 


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


 


iv

















 


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


 


1

















 


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.


 


2

















 


“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.


 


3

















 


“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.


 


4

















 


“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


 


5

















 


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.


 


6

















 


“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


 


7

















 


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.


 


8

















 


“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


 


9

















 


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,


 


10

















 


(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


 


11

















 


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,


 


12

















 


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).


 


13

















 


“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.


 


14

















 


“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.


 


15

















 


“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


 


16

















 


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.


 


17

















 


“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


 


18

















 


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


 


19

















 


(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


 


20

















 


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


 


21

















 


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.


 


22

















 


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.


 


23

















 


(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


 


24

















 


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.


 


26

















 


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


 


27

















 


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


 


28

















 


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


 


29

















 


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


 


30

















 


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.


 


31

















 


(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


 


32

















 


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.


 


33

















 


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.


 


34

















 


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,


 


35

















 


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


 


36

















 


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


 


37

















 


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


 


38

















 


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,


 


39

















 


(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.


 


40

















 


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.


 


41

















 


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”):


 


42

















 


(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


 


43

















 


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


 


44

















 


(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.


 


45

















 


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.


 


46

















 


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


 


47

















 


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 


 


48

















 


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;


 


49

















 


(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


 


50

















 


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.


 


51

















 


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


 


52

















 


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


 


53

















 


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


 


55

















 


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


 


57

















 


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


 


58

















 


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


 


59

















 


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


 


60

















 


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


 


61

















 


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.


 


63

















 


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


 


64

















 


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


 


65

















 


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


 


66

















 


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


 


67

















 


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


 


68

















 


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]


 


69

















 


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

  



 


70

















 


	
  LENDER PARTIES:

  	
  JPMORGAN CHASE BANK, N.A.,

  
	
   

  	
  Administrative Agent and a Lender

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
    /s/  Tara Narasiman

  
	
   

  	
   

  	
   Name:

  	
  Tara Narasiman

  
	
   

  	
   

  	
   Title:

  	
  Associate

  
					



 


71

















 


	
   

  	
  BANK OF AMERICA, N.A.,

  
	
   

  	
  Co-Syndication Agent and a Lender

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
    /s/ Robert D. Valbona

  
	
   

  	
  Name:

  	
  Robert D. Valbona

  
	
   

  	
  Title:

  	
  Managing Director

  
				



 


72

















 


	
   

  	
  CITIBANK, N.A.,

  
	
   

  	
  Co-Syndication Agent and a Lender

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
    /s/  Todd J. Mogi

  
	
   

  	
  Name:

  	
  Todd J. Mogil

  
	
   

  	
  Title:

  	
  Attorney-in-Fact

  
				



 


73

















 


	
   

  	
  WACHOVIA BANK,

  
	
   

  	
  NATIONAL ASSOCIATION,

  
	
   

  	
  Co-Documentation Agent and a Lender

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
    /s/  Shawn Young

  
	
   

  	
  Name:

  	
  Shawn Young

  
	
   

  	
  Title:

  	
  Vice President

  
				



 


74

















 


	
   

  	
  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

  
				



 


75

















 


	
   

  	
  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

  
					



 


76

















 


	
   

  	
  SUNTRUST BANK,

  
	
   

  	
  Managing Agent and a Lender

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By: 

  	
    /s/ Jeffrey R. Titus

  
	
   

  	
  Name:

  	
  Jeffrey R. Titus

  
	
   

  	
  Title:

  	
  Managing Director

  
				



 


77