exv10w1



 





Exhibit 10.1




Execution Copy




AMENDED AND RESTATED GUARANTY AGREEMENT




     THIS AMENDED AND RESTATED GUARANTY AGREEMENT, dated as of January 17, 2008 (as amended,
restated, amended and restated, supplemented or otherwise modified from time to time, the “Guaranty
Agreement”), is made among THE PRUDENTIAL INSURANCE COMPANY OF AMERICA (“Prudential”), TCTM, L.P.,
a Delaware limited partnership (“TCTM”), TEPPCO MIDSTREAM COMPANIES, LLC, a Texas limited liability
company (“TMC”), TEPPCO PARTNERS, L.P., a Delaware limited partnership (“Parent”), TE PRODUCTS
PIPELINE COMPANY, LLC, a Texas limited liability company (“TEPPCO”, and together with TCTM, TMC and
Parent, individually and collectively, jointly and severally, the “TEPPCO Guarantors”) and MARATHON
OIL CORPORATION, a Delaware corporation (“Marathon” and together with the TEPPCO Guarantors, each,
a “Guarantor” and collectively, the “Guarantors”).



     WHEREAS, Centennial Pipeline LLC, a Delaware limited liability company (the “Company”) and
Prudential entered into a Master Shelf Agreement dated as of May 4, 2001, as amended by Letter
Amendment No. 1 and Limited Waiver to Master Shelf Agreement dated as of May 21, 2007 (as so
amended, and as the same may be further amended, supplemented or otherwise modified from time to
time, the “Shelf Agreement”), pursuant to which the Company issued and sold to Prudential the
Company’s senior fixed rate term notes, in the aggregate principal amount of $140,000,000 (the
“Notes”).



     WHEREAS, In connection with the Shelf Agreement, Panhandle Eastern Pipe Line Company (“PEPL”),
TEPPCO and Marathon Petroleum Company LLC, a Delaware limited liability company formerly known as
Marathon Ashland Petroleum LLC (“MAP”), entered into a Guaranty Agreement dated as of May 4, 2001,
as amended by (i) Assignment, Assumption and Amendment No. 1 to Guaranty Agreement dated as of
February 14, 2003 (“Amendment No. 1”) and (ii) Assignment, Assumption and Amendment No. 2 to
Guaranty Agreement dated as of May 21, 2007 (“Amendment No. 2”; such Guaranty Agreement, as so
amended by Amendment No. 1 and Amendment No. 2, the “Original Sponsor Guaranty”).



     WHEREAS, Pursuant to Amendment No. 1, PEPL assigned to each of TEPPCO and MAP, and TEPPCO and
MAP each assumed, 50% of the duties and obligations of PEPL under the Original Sponsor Guaranty.



     WHEREAS, Pursuant to Amendment No. 2, MAP assigned all of its rights and obligations under the
Original Sponsor Guaranty to Marathon, and Marathon assumed all of MAP’s rights and obligations
under the Original Sponsor Guaranty.



     WHEREAS, TEPPCO and Marathon have requested that Prudential agree to amend and restate the
Original Guaranty Agreement in order to allow TCTM, TMC and Parent to become guarantors of the
Guaranteed Obligations (as defined herein) and in order to make certain other



 









 







amendments as more particularly described herein and, subject to the terms and conditions set forth
herein, Prudential is willing to agree to such amendment and restatement.



     NOW THEREFORE, in consideration of the foregoing, each of the Guarantors and Prudential agrees
that the original Sponsor Guaranty is hereby amended and restated in its entirety, for the benefit
of each of the Purchasers (as defined in the Shelf Agreement), as follows:




	 	1.	 	DEFINED TERMS; ACCOUNTING MATTERS.






     (a) Defined Terms. All capitalized terms used herein, unless specifically
otherwise defined, shall have the meanings ascribed to them in the Shelf Agreement. In
addition, the terms defined in the introductory paragraph and recitals of this Guaranty
Agreement shall have the respective meanings specified therein, and the following terms
shall have the meanings specified with respect thereto below:




     “Acceptable Bank” shall mean a commercial bank organized under the laws of the
United States or any state thereof having capital surplus and undivided profits
aggregating at least $250,000,000 and having a senior unsecured long-term debt
rating of A- or better from S&P and A3 or better from Moody’s.




     “Acceptable Credit Support” shall mean any of the following, in each case upon
terms and conditions, and pursuant to documentation in form and substance,
reasonably satisfactory to the Required Holder(s):




	 	(i)	 	cash or Cash Equivalents, in an amount equal to
such Guarantor’s Pro Rata Portion of the Maximum Credit Support Amount
on the date Acceptable Credit Support is to be provided pursuant to the
terms of this Guaranty Agreement, deposited in an account with an
Acceptable Bank, which account, the cash or Cash Equivalents deposited
therein, all interest or other earnings thereon and all other proceeds
thereof are subject to a first priority perfected security interest in
favor of the holders of Notes;
	 
	 	(ii)	 	an Acceptable Letter of Credit, in a face
amount equal to such Guarantor’s Pro Rata Portion of the Maximum Credit
Support Amount on the date Acceptable Credit Support is to be provided
pursuant to the terms of this Guaranty Agreement;
	 
	 	(iii)	 	a guaranty of such Guarantor’s Pro Rata
Portion of the Guaranteed Obligations, substantially in the form of
this Guaranty Agreement and provided by an Affiliate of such Guarantor
that (a) directly or indirectly owns a majority of the issued and
outstanding Capital Securities of such Guarantor and (b) has a senior
unsecured long-term debt rating of BBB- or better from S&P and Baa3 or
better from Moody’s;





2









 






	 	(iv)	 	a guaranty of such Guarantor’s Pro Rata Portion
of the Guaranteed Obligations, substantially in the form of this
Guaranty Agreement and provided by an Affiliate of such Guarantor that
(a) directly or indirectly owns a majority of the issued and
outstanding Capital Securities of such Guarantor and (b) that does not
have a senior unsecured long-term debt rating of BBB- or better from
S&P and Baa3 or better from Moody’s, but with credit acceptable to the
Required Holder(s), as determined by the Required Holder(s) in their
sole discretion; or
	 
	 	(v)	 	(a) at the sole option of the TEPPCO
Guarantors, a guaranty by the TEPPCO Guarantors of the Marathon Pro
Rata Portion of the Guaranteed Obligations, provided,
that, on such date Parent has a senior unsecured long-term debt
rating of BBB- or better from S&P and Baa3 or better from Moody’s or
(b) at the sole option of Marathon, a guaranty by Marathon of the
TEPPCO Pro Rata Portion of the Guaranteed Obligations, substantially in
the form of this Guaranty Agreement, provided, that,
as of such date Marathon has a senior unsecured long-term debt rating
of BBB- or better from S&P and Baa3 or better from Moody’s.






     “Acceptable Letter of Credit” shall mean an irrevocable standby letter of
credit substantially in the form of Exhibit A attached hereto, issued by an
Acceptable Bank and drawable in New York, New York or Dallas, Texas.




     “Authorized Officer” shall mean, with respect to any Guarantor, such
Guarantor’s president, its chief financial officer, its treasurer, any of its vice
presidents or any other officer designated by such Guarantor from time to time.




     “Cash Equivalents” shall mean (i) direct obligations of, or obligations the
timely payment of principal and interest of which are fully and unconditionally
guaranteed by, the United States of America, in any case maturing within one year
after the acquisition thereof, (ii) shares of money market mutual funds that are
classified as current assets in accordance with GAAP and that invest solely in
investments of the type described in the foregoing clause (i), the shares of which
mutual funds are rated AAA by S&P, and which mutual funds are managed by Persons
having capital and surplus in excess of $250,000,000, and (iii) certificates of
deposit, banker’s acceptances and time deposits maturing within one year from the
date of acquisitions thereof issued by a commercial bank or trust company organized
under the laws of the United States or any state thereof having capital surplus and
undivided profits aggregating at least $250,000,000 and being rated “A-” or better
by S&P or “A3” or better by Moody’s.




     “Covenant Default” shall mean, with respect to any Guarantor, that either
(i) such Guarantor fails to perform or observe any term, covenant or agreement
contained in Section 10(b) of this Guaranty Agreement or (ii) such



3









 







Guarantor fails to perform or observe any agreement or covenant contained in
Section 10(a) of this Guaranty Agreement, and, in the case of this clause (ii), such
failure shall not be remedied within 30 days after any Responsible Officer of such
Guarantor obtains actual knowledge thereof.




     “Credit Fee” shall have the meaning specified in Section 12(b)(i) of this
Guaranty Agreement.




     “Credit Fee Termination Date” shall have the meaning specified in
Section 12(b)(iii) of this Guaranty Agreement.




     “Effective Date” shall have the meaning specified in Section 25 of this
Guaranty Agreement.




     “Guaranteed Obligations” shall have the meaning specified in Section 2 of this
Guaranty Agreement.




     “Majority Holder(s)” shall mean, at any time, the holder or holders of at least
51% of the aggregate principal amount of the Notes outstanding at such time,
excluding all Notes held by the Company or any Affiliate of the Company.




     “Marathon Pro Rata Portion” shall mean, as to Marathon, 50%.




     “Material Adverse Effect” shall mean, with respect to any Guarantor, (i) a
material adverse effect on the business, assets, operations, or financial condition
of such Guarantor and its Subsidiaries, taken as a whole, (ii) material impairment
of such Guarantor’s ability to perform any of its respective obligations under this
Guaranty Agreement or (iii) material impairment of the validity or enforceability of
the rights of the holders of any of the Notes under this Guaranty Agreement.




     “Maximum Credit Support Amount” shall mean, as of any date of determination
thereof, an amount equal to the sum of (i) the aggregate principal amount of Term
Notes then outstanding, plus (ii) the aggregate principal amount of Accepted
Notes (as defined in the Shelf Agreement) which have not yet been purchased and sold
pursuant to the Shelf Agreement prior to such date, plus (iii) the Available
Facility Amount (as defined in the Shelf Agreement) as of such date, plus
(iv) an amount equal to the amount of interest, calculated at the highest rate of
interest applicable to any Notes then outstanding, that would accrue and be payable
for any six-month period on Notes with an aggregate principal balance equal to the
sum of the amounts set forth in clauses (i), (ii) and (iii).




     “Moody’s” shall mean Moody’s Investors Service, Inc. and its successors.




     “Pro Rata Portion” shall mean, (i) as to each TEPPCO Guarantor, in each case on
a joint and several basis with the other TEPPCO Guarantors, the



4









 







TEPPCO Pro Rata Portion and (ii) as to Marathon, the Marathon Pro Rata Portion.




     “Representation Default” shall mean, with respect to any Guarantor, that a
representation or warranty made by such Guarantor in this Guaranty Agreement or by
such Guarantor or any of its officers in any writing furnished in connection with or
pursuant to the Shelf Agreement, the Revolving Note Agreement or this Guaranty
Agreement shall be false in any material respect on the date as of which made.




     “Responsible Officer” shall mean, with respect to a Guarantor, the chief
executive officer, chief operating officer, chief financial officer or chief
accounting officer, or any other officer involved principally in its financial
administration or its controllership function.




     “S&P” shall mean Standard & Poor’s Ratings Group, a division of The McGraw-Hill
Companies, Inc., and its successors.




     “Split Rating” shall mean, with respect to (i) any of the TEPPCO Guarantors,
that Parent possesses or (ii) Marathon, that Marathon possesses, either (A) a senior
unsecured long-term debt rating of BB+ from S&P and a senior unsecured long-term
debt rating of Baa3 or better from Moody’s or (B) a senior unsecured long-term debt
rating of Ba1 from Moody’s and a senior unsecured long-term debt rating of BBB- or
better from S&P.




     “Sponsor Default Event” shall mean, with respect to (i) any of the TEPPCO
Guarantors, that (A) Parent possesses either of the following: (1) a senior
unsecured long-term debt rating of BB+ or worse from S&P and a senior unsecured
long-term debt rating of Ba2 or worse from Moody’s, or (2) a senior unsecured
long-term debt rating of Ba1 or worse from Moody’s and a senior unsecured long-term
debt rating of BB or worse from S&P; or (B) either S&P or Moody’s ceases to maintain
a senior unsecured long-term debt rating for Parent or (ii) Marathon, that
(A) Marathon possesses either of the following: (1) a senior unsecured long-term
debt rating of BB+ or worse from S&P and a senior unsecured long-term debt rating of
Ba2 or worse from Moody’s, or (2) a senior unsecured long-term debt rating of Ba1 or
worse from Moody’s and a senior unsecured long-term debt rating of BB or worse from
S&P; or (B) either S&P or Moody’s ceases to maintain a senior unsecured long-term
debt rating for Marathon. With respect to any of the TEPPCO Guarantors or Marathon,
a Sponsor Default Event shall also be deemed to have occurred if Parent or Marathon,
as applicable, fails to comply with the provisions of either of clauses (a) or (b)
of Section 12 hereof, within the time periods specified therein.




     “TEPPCO Pro Rata Portion” shall mean, jointly and severally as to the TEPPCO
Guarantors, 50%.



5









 






     “Trigger Event” shall mean, with respect to (i) any of the TEPPCO Guarantors,
that Parent possesses or (ii) Marathon, that Marathon possesses, any of the
following: (A) a senior unsecured long-term debt rating of BB+ from S&P and a senior
unsecured long-term debt rating of Ba1 from Moody’s; (B) a senior unsecured
long-term debt rating of BBB- or better from S&P and a senior unsecured long-term
debt rating of Ba2 or worse from Moody’s; or (C) a senior unsecured long-term debt
rating of Baa3 or better from Moody’s and a senior unsecured long-term debt rating
of BB or worse from S&P.




     (b) Accounting and Legal Principles, Terms and Determinations. All references
in this Guaranty Agreement to “GAAP” shall be deemed to refer to generally accepted
accounting principles in effect in the United States at the time of application thereof.
Unless otherwise specified herein, all accounting terms used herein shall be interpreted,
all determinations with respect to accounting matters hereunder shall be made, and all
unaudited financial statements and certificates and reports as to financial matters required
to be furnished hereunder shall be prepared, in accordance with GAAP applied on a basis
consistent with the most recent audited consolidated financial statements of each Guarantor
and its Subsidiaries delivered pursuant to clause (ii) of Section 10(a) hereof or, if no
such statements have been so delivered, the most recent audited financial statements
referred to in clause (i) of paragraph 8B of the Shelf Agreement.




	 	2.	 	THE GUARANTY. Each of (a) the TEPPCO Guarantors hereby irrevocably, unconditionally and
jointly and severally guarantees to each holder from time to time of any of the Notes, the
TEPPCO Pro Rata Portion and (b) Marathon hereby irrevocably and unconditionally guarantees to
each holder from time to time of any of the Notes, the Marathon Pro Rata Portion, of (i) the
due and punctual payment in full of the principal of, Yield-Maintenance Amount or Breakage
Cost Obligations, if any, interest and all other amounts due under the Notes from time to time
outstanding, when and as the same shall become due and payable, whether at stated maturity or
by required or optional prepayment or purchase, by acceleration or otherwise (including
interest due on overdue payments of principal, Yield-Maintenance Amount or Breakage Cost
Obligations, if any, or interest at the rate set forth in the Notes or any other amounts due
thereunder) which may become due under the terms and provisions of the Notes or the Shelf
Agreement, and (ii) the full and prompt payment of all other obligations and liabilities of
the Company under the Shelf Agreement or under any other Shelf Documents (collectively, the
“Note Documents”) (all such obligations, covenants, conditions and agreements described in the
foregoing clauses (i) and (ii) being hereinafter collectively referred to as the “Guaranteed
Obligations”). The guaranty in the preceding sentence is an absolute, present and continuing
guaranty of payment and not of collectibility and is in no way conditional or contingent upon
any attempt to collect from the Company or any other guarantor of the Notes or upon any other
action, occurrence or circumstance whatsoever. In the event that the Company shall fail so to
pay any of such Guaranteed Obligations, each of Marathon, on one hand, and the TEPPCO
Guarantors, on the other hand, severally (but not jointly) agrees to pay their respective Pro
Rata Portion of the same when due to the holders of the Notes entitled thereto, without
demand, presentment, protest or notice of any kind, in lawful money of the United States of
America, at the






6












 






	 	 	place for payment specified in the Notes and the Shelf Agreement. Each
default in payment of principal of, Yield-Maintenance Amount or Breakage Cost Obligations, if
any, or interest or any other amounts due on any Note shall give rise to a separate cause of
action hereunder and separate suits may be brought hereunder as each cause of action arises.
Each of the Guarantors hereby agrees that the Notes issued in connection with the Shelf
Agreement may make reference to this guaranty.
	 
	 	 	Each of the Guarantors hereby agrees, to the extent of its applicable Pro Rata Portion, to
pay and to indemnify and save the holders of the Notes harmless from and against any damage,
loss, cost or expense (including attorneys’ fees) which such holder may incur or be subject
to as a consequence, direct or indirect, of (i) any breach by such Guarantor or by the
Company of any warranty, covenant, term or condition in, or the occurrence of any default
under, this Guaranty Agreement, the Notes, the Shelf Agreement or any other Note Document,
together with all expenses resulting from the compromise or defense of any claims or
liabilities arising as a result of any such breach or default, and (ii) any legal action
commenced to challenge the validity of this Guaranty Agreement, the Notes, the Shelf
Agreement or any other Note Document. Notwithstanding any other provision of this Guaranty
Agreement to the contrary, all obligations of the TEPPCO Guarantors under this Guaranty
Agreement are joint and several as among the TEPPCO Guarantors.






	3.	 	OBLIGATIONS ABSOLUTE. The obligations of each of the Guarantors hereunder shall be primary,
absolute, irrevocable and unconditional, irrespective of the validity, regularity or
enforceability of the Notes, the Shelf Agreement or any other Note Documents, shall not be
subject to any counterclaim, setoff, deduction or defense (other than indefeasible payment)
based upon any claim such Guarantor may have against the Company or any holder of the Notes or
otherwise, and shall remain in full force and effect without regard to, and shall not be
released, discharged or in any way affected by, any circumstance or condition whatsoever
(whether or not such Guarantor shall have any knowledge or notice thereof), including, without
limitation: (a) any amendment, modification of or supplement to the Shelf Agreement, the Notes
or any other instrument referred to therein (except that the obligations of such Guarantor
hereunder shall apply to the Shelf Agreement, the Notes or such other instruments as so
amended, modified or supplemented) or any assignment or transfer of any thereof or of any
interest therein, or any furnishing, acceptance or release of any security for the Notes, (b)
any waiver, consent, extension, indulgence or other action or inaction under or in respect of
the Notes or in respect of the Shelf Agreement or any other Note Document; (c) any bankruptcy,
insolvency, readjustment, composition, liquidation or similar proceeding with respect to the
Company or its property; (d) any merger, amalgamation or consolidation of such Guarantor or of
the Company into or with any other corporation or any sale, lease or transfer of any or all of
the assets of such Guarantor or of the Company to any person; (e) any failure on the part of
the Company for any reason to comply with or perform any of the terms of any other agreement
with such Guarantor; or (f) any other circumstance which might otherwise constitute a legal or
equitable discharge or defense of a guarantor. Each of the Guarantors covenants that, unless
released in accordance with Section 13 hereof, its obligations hereunder will not be
discharged except by payment in full of its Pro Rata Portion of the Guaranteed Obligations.




7









 












	4.	 	WAIVER. Each of the Guarantors unconditionally waives to the fullest extent permitted
by law, (a) notice of acceptance hereof, of any action taken or omitted in reliance hereon
and of any defaults by the Company in the payment of any amounts due under the Notes, the
Shelf Agreement or any other Note Document, and of any of the matters referred to in Section
3 hereof, (b) all notices which may be required by statute, rule of law or otherwise to
preserve any of the rights of each holder from time to time of the Notes against such
Guarantor, including, without limitation, presentment to or demand for payment from the
Company or such Guarantor with respect to any Note, notice to the Company or to such
Guarantor of default or protest for nonpayment or dishonor and the filing of claims with a
court in the event of the bankruptcy of the Company, (c) any right to the enforcement,
assertion or exercise by any holder of the Notes of any right, power or remedy conferred in
this Guaranty Agreement, the Shelf Agreement, the Notes or any other Note Document, (d) any
requirement or diligence on the part of any holder of the Notes and (e) any other act or
omission or thing or delay to do any other act or thing which might in any manner or to any
extent vary the risk of such Guarantor or which might otherwise operate as a discharge of
such Guarantor.






	5.	 	OBLIGATIONS UNIMPAIRED. Each of the Guarantors authorizes the holders of the Notes, without
notice or demand to such Guarantor and without affecting its obligations hereunder, from time
to time (a) to renew, compromise, extend, accelerate or otherwise change the time for payment
of, or otherwise change the terms of, all or any part of the Notes, the Shelf Agreement or any
other instrument referred to therein, (b) to take and hold security for the payment of the
Notes, for the performance of this Guaranty Agreement or otherwise for the indebtedness
guaranteed hereby and to exchange, enforce, waive and release any such security, (c) to apply
any such security and to direct the order or manner of sale thereof as the holders of the
Notes in their sole discretion may determine; (d) to obtain additional or substitute endorsers
or guarantors; (e) to exercise or refrain from exercising any rights against the Company and
others; and (f) to apply any sums, by whomsoever paid or however realized, to the payment of
the principal of, Yield-Maintenance Amount or Breakage Cost Obligations, if any, or interest
or any other amounts due on the Notes and any other Guaranteed Obligation hereunder. Each of
the Guarantors waives any right to require the holders of the Notes to proceed against any
additional or substitute endorsers or guarantors or to pursue or exhaust any security provided
by the Company, such Guarantor or any other person or to pursue any other remedy available to
such holders.






	6.	 	SUBROGATION. Each of the Guarantors agrees that it will not exercise any rights which it may
have acquired by way of subrogation under this Guaranty Agreement, by any payment made
hereunder or otherwise, or accept any payment on account of such subrogation rights, or any
rights of reimbursement or indemnity or any rights or recourse to any security for the Notes
or this Guaranty Agreement unless and until all of the obligations, undertakings or conditions
to be performed or observed by the Company pursuant to the Notes, the Shelf Agreement and any
other Note Document at the time of such Guarantor’s exercise of any such right shall have been
performed, observed or paid in full.




8









 












	7.	 	REINSTATEMENT OF GUARANTY. This Guaranty Agreement shall continue to be
effective, or be reinstated, as the case may be, if and to the extent at any time payment,
in whole or in part, of any of the sums due to any holder of the Notes for principal of,
Yield-Maintenance Amount or Breakage Cost Obligations, if any, or interest on the Notes or
any of the other Guaranteed Obligations is rescinded or must otherwise be restored or
returned by such holder upon the insolvency, bankruptcy, dissolution, liquidation or
reorganization of the Company, or upon or as a result of the appointment of a custodian,
receiver, trustee or other officer with similar powers with respect to the Company or any
substantial part of its property, or otherwise, all as though such payments had not been
made. If an event permitting the acceleration of the maturity of the principal amount of
the Notes shall at any time have occurred and be continuing and such acceleration shall at
such time be prevented or the right of any holder of a Note to receive any payment under any
Note shall at such time be delayed or otherwise affected by reason of the pendency against
the Company of a case or proceeding under a bankruptcy or insolvency law, each of the
Guarantors agrees that, for purposes of this Guaranty Agreement and its obligations
hereunder, the maturity of such principal amount shall be deemed to have been accelerated
with the same effect as if the holders of the Notes had accelerated the same in accordance
with the terms of the Shelf Agreement, and such Guarantor shall forthwith pay its Pro Rata
Portion of such accelerated principal amount, accrued interest and Yield-Maintenance Amount
or Breakage Cost Obligations, if any, or any other amounts due thereon and any other amounts
guaranteed hereunder.






	8.	 	PAYMENTS. Each of (a) Marathon, on one hand, and (b) the TEPPCO Guarantors, on the other
hand, hereby severally (but not jointly) guaranty that their respective Pro Rata Portion of
the Guaranteed Obligations will be paid to each holder of the Notes in lawful currency of the
United States of America and in immediately available funds, at the times and places provided
in, and otherwise strictly in accordance with the terms and provisions of, the Shelf Agreement
and the Notes (regardless of any law, regulation or decree now or hereafter in effect which
might in any manner affect the Guaranteed Obligations, or the rights of any such holder with
respect thereto as against the Company, or cause or permit to be invoked any alteration in the
time, amount or manner of payment by the Company of any or all of the Guaranteed Obligations),
without set-off or counterclaim and free and clear of, and without reduction for or on account
of, any present or future income, stamp or other taxes, levies, imposts, duties, charges,
fees, deductions, withholdings now or hereafter imposed, levied, collected, withheld or
assessed by any country (or by any political subdivision or taxing authority thereof or
therein) excluding income and franchise taxes of the United States of America or any political
subdivision, state or taxing authority thereof or therein (including Puerto Rico) (such
non-excluded taxes being called “Foreign Taxes”). If any Foreign Taxes are required to be
withheld from any amount payable to any such holder under this Guaranty Agreement or under the
Notes, the amounts so payable to such holder shall be increased to the extent necessary to
yield to such holder (after payment of all Foreign Taxes) interest or any such other amounts
at the rates or in the amounts specified in the Shelf Agreement and the Notes.






	9.	 	RANK OF GUARANTY. Each of the Guarantors agrees that its obligations under this




9









 






	 	 	Guaranty
Agreement shall rank at least pari passu with all other unsecured senior
obligations of such Guarantor now or hereafter existing.






	10.	 	ADDITIONAL COVENANTS OF THE GUARANTORS.






     (a) General. So long as the Notes are outstanding or the Shelf Agreement shall
remain in effect, each of the Guarantors agrees that unless the Majority Holder(s) otherwise
consent in writing:




	 	(i)	 	Maintenance of Existence, Etc. Such Guarantor will at
all times do or cause to be done all things necessary to maintain and preserve
its corporate, limited liability company or partnership existence.
	 
	 	(ii)	 	Financial Statements, Etc. Each of Marathon and Parent
will furnish to each holder of any Notes that is a Permitted Transferee:






     (A) beginning with the fiscal year ending December 31, 2007, as soon as
available, and in any event within 120 days after the end of each fiscal
year of such Guarantor, a consolidated balance sheet of such Guarantor and
its consolidated Subsidiaries as at the end of such fiscal year and the
related consolidated statements of operations and sources of funds of such
Guarantor and its consolidated Subsidiaries for such fiscal year, prepared
in conformity with GAAP consistently applied (except as disclosed in the
notes thereto) and reported on by independent accountants of recognized
national standing;




     (B) as soon as available, and in any event within 60 days after the end
of each quarter (except the last quarter) of each fiscal year of such
Guarantor, a consolidated balance sheet of such Guarantor and its
consolidated Subsidiaries as at the end of such quarter and the related
consolidated statements of operations and sources of funds of such Guarantor
and its consolidated Subsidiaries for such quarter and for the period from
the beginning of such fiscal year to the end of such quarter, in each case
setting forth comparative figures for the related periods in the prior
fiscal year, certified by the chief financial officer, the chief accounting
officer or the treasurer of such Guarantor to have been prepared in
accordance with generally accepted accounting principals consistently
applied (except as disclosed in the notes thereto and subject to normal
year-end adjustments);




     (C) concurrently with the delivery each year of the financial
statements furnished pursuant to Section 10(a)(ii)(A), an officer’s
certificate of such Guarantor certifying that the signer has reviewed, or
caused to be reviewed by persons under his supervision, the relevant terms
of this Guaranty Agreement and has made, or caused to be made under his
supervision, a review of the transactions and financial condition of such



10









 







Guarantor and its consolidated Subsidiaries during the preceding year, and
that such review has not disclosed the existence during such period, nor
does the signer have knowledge of the existence as at the date of such
certificate, of a default hereunder or with respect to the Guaranteed
Obligations or, if any such a default existed or exists, specifying the
nature and period of existence thereof and what action such Guarantor has
taken or is taking or proposed to take with respect thereto; and




     (D) concurrently with each delivery of financial statements furnished
pursuant to Section 10(a)(ii)(A) or Section 10(a)(ii)(B), an officer’s
certificate of Marathon and Parent certifying that no Split Rating, Trigger
Event, Sponsor Default Event or other downgrade in senior unsecured
long-term debt ratings with respect to such Guarantor has occurred or, if
any such event has occurred, specifying the nature and period of existence
thereof.




	 	(iii)	 	Notices, Etc. Such Guarantor will furnish to each
holder of any Notes:






     (A) promptly, and in any event within five Business Days after any
Responsible Officer obtains knowledge of any Split Rating, Trigger Event,
Sponsor Default Event or other downgrade in senior unsecured long-term debt
ratings with respect to such Guarantor, an officer’s certificate of such
Guarantor specifying the nature and period of existence thereof; and




     (B) with reasonable promptness, such other information relating to such
Guarantor or any of its Subsidiaries as any holder of a Note may from time
to time reasonably request.




	 	(iv)	 	Inspections, Etc. Such Guarantor will permit any
authorized representative of any holder of the Notes, upon reasonable prior
notice and at the expense of such holder, to visit and discuss with such
Guarantor’s officers the financial condition of such Guarantor and such
Guarantor’s ability to comply with its obligations hereunder, all at such
reasonable times and intervals as such holder may request.






     (b) Merger, Consolidation. Each of the Guarantors agrees that, so long as this
Guaranty Agreement shall remain in effect, it shall not consolidate with or merge into any
other Person or convey, transfer or lease all or substantially all of its assets as an
entirety (whether by one transaction or a series of related transactions) to any Person,
unless:




	 	(i)	 	the successor entity formed by such consolidation or into which
such Guarantor is merged or the successor entity which acquires by conveyance,
transfer or lease all or substantially all of its assets as an entirety shall
be a solvent entity organized and existing under the laws of






11












 






	 	 	 	the United States of America, any State thereof or the District of Columbia,
and the fair market value of the portion of such successor entity’s assets
and properties that are located within the United States shall be not less
than $150,000,000;
	 
	 	(ii)	 	such successor entity (or entity to which all or substantially
all of such Guarantor’s assets shall have been conveyed, transferred or leased)
shall expressly assume in writing by instrument or instruments reasonably
satisfactory to the Majority Holder(s), in scope, form and legal effect, the
due and punctual payment, performance and observance of all obligations of such
Guarantor under this Guaranty Agreement, with the same effect as if such entity
had originally been named Guarantor herein or had been a party hereto;
	 
	 	(iii)	 	prior to and immediately after giving effect to such
transaction, no Default or Event of Default (as such terms are defined in the
Shelf Agreement) shall exist;
	 
	 	(iv)	 	such Guarantor shall have delivered to each of the holders of
the Notes an officer’s certificate stating that such consolidation, merger,
conveyance, transfer or lease and the assumption agreement required by
clause (ii) above comply with the provisions of this Section 10(b) and that
such officer has confirmed such compliance with legal counsel not
unsatisfactory to the Majority Holder(s); and
	 
	 	(v)	 	immediately after giving effect to such transaction, the
tangible net worth (calculated in accordance with GAAP) of the successor entity
formed by such consolidation or into which such Guarantor is merged or the
successor entity which acquires by conveyance, transfer or lease all or
substantially all of such Guarantor’s assets, shall not be less than that of
such Guarantor immediately prior to such transaction.






     Upon any consolidation or merger, or any conveyance, transfer or lease of all
or substantially all of the assets of such Guarantor as an entirety in accordance
with this Section 10(b), the successor entity formed by such consolidation or into
which such Guarantor is merged or to which such conveyance, transfer or lease is
made shall succeed to, and be substituted for, such Guarantor under this Guaranty
Agreement, with the same effect as if such successor entity had been named as a
Guarantor herein. Such conveyance, transfer or lease of all or substantially all of
the assets of such Guarantor as an entirety shall have the effect of releasing such
Guarantor (or any successor entity which shall theretofore have become such in the
manner prescribed in this Section 10(b)) from its obligations hereunder.



12









 





11. REPRESENTATIONS AND WARRANTIES OF THE GUARANTORS.




     Each of the Guarantors represents and warrants as follows:




     (a) Organization, Good Standing and Location. Such Guarantor (and in the case
of each Guarantor that is a limited partnership, its general partner) is (i) a corporation,
limited partnership or limited liability company (as applicable) duly organized, validly
existing and in good standing under the laws of its state of organization, (ii) duly
qualified and authorized to do business and in good standing in every other jurisdiction
where the nature of its business requires such qualification and (iii) has all requisite
corporate, limited partnership or limited liability company (as applicable) power and
authority, and all governmental licenses and permits, to own and operate its properties and
to carry on its businesses as presently conducted. Such Guarantor has the requisite
corporate, limited partnership or limited liability company (as applicable) power to enter
into and perform its obligations under this Guaranty Agreement.




     (b) Approval and Enforceability of Guaranty Agreement. The execution, delivery
and performance of this Guaranty Agreement has been duly authorized by all necessary
corporate, partnership or limited liability company (as applicable) action on the part of
such Guarantor (and in the case of each Guarantor that is a limited partnership, its general
partner). The Guaranty Agreement has been duly and validly executed and delivered and
constitutes the legal, valid and binding obligation of such Guarantor, enforceable against
it in accordance with its terms.




     (c) Actions Pending. There is no action, suit, investigation or proceeding
pending or, to the knowledge of such Guarantor (or, in the case of each Guarantor that is a
limited partnership, to the knowledge of its general partner), threatened against such
Guarantor or any of its Subsidiaries, or any properties or rights of such Guarantor or any
of its Subsidiaries, by or before any court, arbitrator or administrative or governmental
body which could reasonably be expected to have a Material Adverse Effect.




     (d) Conflicting Agreements and Other Matters. Neither such Guarantor nor any
of its Subsidiaries is a party to or otherwise subject to any contract or agreement or
subject to any charter or other corporate, limited partnership or limited liability company
(as applicable) restriction which could reasonably be expected to have a Material Adverse
Effect. Neither the execution nor delivery of this Guaranty Agreement, the Shelf Agreement
or the Notes, nor the offering, issuance and sale of the Notes, nor fulfillment of nor
compliance with the terms and provisions hereof and of the Shelf Agreement, the Notes and
any other Note Documents will conflict with, or result in a breach of the terms, conditions
or provisions of, or constitute a default under, or result in any violation of, or result in
the creation of any Lien upon any of the properties or assets of such Guarantor or any of
its Subsidiaries pursuant to, the charter, by-laws, limited partnership agreement, limited
liability company agreement, regulations or other organizational documents of such Guarantor
or any of its Subsidiaries, any award of any arbitrator or any agreement (including any
agreement with stockholders or members), instrument, order, judgment,



13









 







decree, statute, law, rule or regulation to which such Guarantor or any of its
Subsidiaries is subject. Neither such Guarantor nor any of its Subsidiaries is a party to,
or otherwise subject to any provision contained in, any instrument evidencing Indebtedness
of such Guarantor or such Subsidiary, any agreement relating thereto or any other contract
or agreement (including its charter, limited partnership agreement, limited liability
company agreement or other organizational documents) which limits the amount of, or
otherwise imposes restrictions on the incurring of, Indebtedness of such Guarantor
represented by this Guaranty Agreement or Indebtedness of the Company of the type to be
evidenced by the Notes.




     (e) Governmental Consent. Neither the nature of such Guarantor or of any
Subsidiary, nor any of their respective businesses or properties, nor any relationship
between such Guarantor or any Subsidiary and any other Person, nor any circumstance in
connection with the execution and delivery of this Guaranty Agreement and the Shelf
Agreement and the offering, issuance, sale or delivery of the Notes is such as to require
any authorization, consent, approval, exemption or other action by or notice to or filing
with any court or administrative or governmental body (other than routine filings after the
date of closing with the Securities and Exchange Commission and/or state Blue Sky
authorities) in connection with the execution and delivery of this Guaranty Agreement and
the Shelf Agreement, the offering, issuance, sale or delivery of the Notes or fulfillment of
or compliance with the terms and provisions hereof or of the Shelf Agreement or the Notes.




     (f) Disclosure. This Guaranty Agreement, together with each other document,
certificate or statement furnished to any holder of Notes by or on behalf of such Guarantor
in connection herewith, does not contain any untrue statement of a material fact or omit to
state a material fact necessary in order to make the statements contained herein and therein
not misleading. There is no fact peculiar to such Guarantor or any of its Subsidiaries (and
not applicable to the oil and gas industry generally) which materially adversely affects or
in the future may (so far as such Guarantor can now foresee) materially adversely affect the
business, property or assets, financial condition or operations of such Guarantor and its
Subsidiaries and which has not been set forth in this Guaranty Agreement or in the other
documents, certificates and statements furnished to the holders of Notes by or on behalf of
such Guarantor prior to the date hereof in connection with the transactions contemplated
hereby.



12. CREDIT MAINTENANCE REQUIREMENTS.





     (a) Split Rating.




     (i) In the event Marathon or Parent receives a Split Rating, such
Guarantor shall at its option, exercised by written notice to each holder of
Notes within five Business Days after the announcement by S&P or Moody’s, as
applicable, of the rating downgrade that results in such Split Rating,
provide the holders of Notes with either (A) from such Guarantor or the
applicable Subsidiary of such Guarantor holding



14









 







membership interests in the Company, as applicable, a first priority
perfected pledge of and security interest in such Guarantor’s or such
Subsidiary’s membership interest in the Company, which shall be subject to
no options, rights of first refusal or other restrictions on transfer,
within 10 Business Days following the date of such notice from such
Guarantor, by executing and delivering, or causing such Subsidiary to
execute and deliver, a Pledge Agreement in substantially the form attached
hereto as Exhibit B, and by performing and satisfying, or causing
such Subsidiary to perform and satisfy, all of the terms and conditions set
forth therein with respect to creation and perfection of such pledge and
security interest, or (B) Acceptable Credit Support within 30 Business Days
following the date of such notice from such Guarantor, which collateral or
other credit support shall also be upon terms and conditions and pursuant to
documentation in form and substance reasonably satisfactory to the Required
Holder(s).




     (ii) Any pledge of membership interests by a Guarantor, or by a
Subsidiary of such Guarantor, following receipt by Marathon or Parent of a
Split Rating (the applicable Guarantor receiving such Split Rating being
referred to herein as the “Split Rated Guarantor”) will be released by the
holders of Notes (A) if such Split Rated Guarantor reestablishes both (I) a
senior unsecured long-term debt rating of BBB- or better from S&P and (II) a
senior unsecured long-term debt rating of Baa3 or better from Moody’s or
(B) if Acceptable Credit Support is provided by one or more TEPPCO
Guarantors or Marathon, as applicable.




     (iii) For avoidance of doubt, (A) no Credit Fee shall be assessed in
the event of a Split Rating and (B) so long as a Sponsor Default Event shall
not have been deemed to have occurred as a result of a Guarantor’s failure
to comply with the provisions of this Section 12(a) within the time periods
specified herein, the providing of Acceptable Credit Support shall not be
required in the event of a Split Rating, but shall instead be provided only
at the option of the applicable Guarantor in lieu of pledging its membership
interest, or causing its applicable Subsidiary to pledge such Subsidiary’s
membership interest, in the Company.




     (b) Trigger Event.




     (i) Upon the occurrence of a Trigger Event with respect to Marathon, on
one hand, or Parent, on the other hand (the applicable Guarantor with
respect to which such Trigger Event occurred being referred to herein as the
“Trigger Guarantor”), the Required Holder(s), at their option and by written
notice delivered to such Trigger Guarantor, may assess such Trigger
Guarantor, a “Credit Fee” (calculated with respect to the applicable Pro
Rata Portion, as more fully described hereinbelow), which shall be
determined by the Required Holder(s) in their sole discretion, in a manner
consistent with the Required Holder(s)’



15









 







customary and prevailing investment pricing practices for comparable issuers
of debt securities of similar type and tenor, with reference to the
increased credit spreads attributable to the change in credit quality of
Marathon or Parent represented by such Trigger Event; provided, that
in no event shall any such increased credit spread used to determine a
Credit Fee exceed 6.00% per annum. Any Credit Fee assessed to Marathon, on
one hand, or the TEPPCO Guarantors, on the other hand, shall be calculated
by multiplying (A) the percentage amount corresponding to such Guarantor’s
Pro Rata Portion by (B) the sum of the products obtained by
multiplying (I) the increases in credit spreads, determined as set forth in
the immediately preceding sentence, by (II) the aggregate
outstanding principal amount of Notes of respective corresponding tenor.
For purposes of calculating the portion of any Credit Fee attributable to
the Revolving Notes for any period, the outstanding principal amount of
Revolving Notes shall be deemed to be the average aggregate daily balance of
Revolving Loans outstanding during such period.




     (ii) In lieu of paying such Credit Fee, Marathon, on one hand, or the
TEPPCO Guarantors, on the other hand, may elect, by written notice to the
holders of Notes delivered at any time following a Trigger Event, to post
Acceptable Credit Support as security for the payment of its Pro Rata
Portion of the Guaranteed Obligations.




     (iii) Any such Credit Fee, if assessed, shall accrue and be payable
from and after the date of occurrence of such Trigger Event through the
earliest to occur of (A) the date the senior unsecured long-term debt
ratings of (a) Parent, if Parent is the Trigger Guarantor, or (b) Marathon,
if Marathon is the Trigger Guarantor, improve to a Split Rating or better,
or (B) the date Acceptable Credit Support is provided by Marathon or the
TEPPCO Guarantors, as applicable, if Marathon or the TEPPCO Guarantors, as
applicable, has elected to post Acceptable Credit Support as provided under
Section 12(b)(ii) (the earliest to occur of such dates, the “Credit Fee
Termination Date”), and shall be payable by Marathon or the TEPPCO
Guarantors, as applicable, directly to the holders of Notes, ratably in
accordance with the respective outstanding principal amount of Notes held by
such holders, in arrears on the last day of each March, June, September and
December, commencing on the last day of March, June, September or December
next succeeding the date of occurrence of such Trigger Event, and on the
Credit Fee Termination Date.




     (c) Sponsor Default Event.




     (i) Upon the occurrence of a Sponsor Default Event with respect to
Marathon, on one hand, or the TEPPCO Guarantors, on the other hand, as a
result of such Guarantor’s failure to comply with the



16









 







provisions of either of clauses (a) or (b) of this Section 12 within the
time periods specified therein, the other Guarantors may at their option
post Acceptable Credit Support on behalf of such Guarantor on or before the
30th Business Day following the expiration of the 30-Business-Day period
referred to in such clause (a) or (b), as applicable.




(ii) (A) Upon the occurrence of a Sponsor Default Event with respect
to any Guarantor, other than as specified in clause (i) above, the
Required Holder(s), at their option and by written notice delivered
to such Guarantor, may either (I) assess such Guarantor an additional
Credit Fee, which shall be calculated in the manner, shall be subject
to the same limitation on the increased credit spreads used in such
calculation and shall accrue and be payable at the times set forth
above in Section 12(b), or (II) require that such Guarantor provide
Acceptable Credit Support, which may be in any form of Acceptable
Credit Support other than that specified in clause (iv) of the
definition thereof, as security for payment of such Guarantor’s Pro
Rata Portion of the Guaranteed Obligations.




     (B) If the Required Holder(s) elect to require that such
Guarantor provide such Acceptable Credit Support, such Guarantor
shall have 30 Business Days following notice of such election to post
such Acceptable Credit Support. If such Guarantor fails to post
Acceptable Credit Support within such 30-Business Day period, the
other Guarantors may at their option post such Acceptable Credit
Support on behalf of such Guarantor on or before the 30th Business
Day following such initial 30-Business Day period.




     (iii) The provision by a Guarantor (the “non-defaulting Guarantor”) of
Acceptable Credit Support for the benefit of another Guarantor (the
“defaulting Guarantor”) under the circumstances contemplated by clause (i)
or subclause (ii)(B) above, shall not release the defaulting Guarantor from
any liability under this Guaranty Agreement. For avoidance of doubt, if
Acceptable Credit Support shall not have been provided within the time
periods specified above, whether by the defaulting Guarantor or any
non-defaulting Guarantor, an Event of Default shall have occurred under
clause (xvii) of paragraph 7A of the Shelf Agreement. In addition, if the
defaulting Guarantor shall have previously pledged its membership interest
in the Company as contemplated by Section 12(a)(i), the holders of the Notes
shall, upon receipt of Acceptable Credit Support from the non-defaulting
Guarantor, release the pledge of such membership interest.




17












 






	 	(d)	 	Representation Default.






     (i) Upon a determination that a Representation Default or a Covenant
Default with respect to any Guarantor has occurred, the Required Holder(s),
at their option and by written notice delivered to such Guarantor, may
require that such Guarantor provide Acceptable Credit Support, which may be
in any form of Acceptable Credit Support other than that specified in
clause (iv) of the definition thereof, as security for payment of such
Guarantor’s Pro Rata Portion of the Guaranteed Obligations.




     (ii) If the Required Holder(s) require that such Guarantor provide such
Acceptable Credit Support, such Guarantor shall have 10 Business Days
following notice thereof to post such Acceptable Credit Support. If such
Guarantor fails to post Acceptable Credit Support within such 10-Business
Day period, the other Guarantors may at their option post such Acceptable
Credit Support on behalf of such Guarantor on or before the 5th Business Day
following such initial 10-Business Day period.




     (iii) The provision by a non-defaulting Guarantor of Acceptable Credit
Support for the benefit of a defaulting Guarantor under the circumstances
contemplated by clause (ii) above shall not release such defaulting
Guarantor from any liability under this Guaranty Agreement. For avoidance
of doubt, if Acceptable Credit Support shall not have been provided within
the time periods specified above, whether by the defaulting Guarantor or any
non-defaulting Guarantor, an Event of Default shall have occurred under
clause (xvii) of paragraph 7A of each of the Shelf Agreement.




	13.	 	TERMINATION AND RELEASE. Subject to the provisions of Section 7, and except to the extent
that any Guarantor’s obligations arising hereunder prior to such time have not been fulfilled,
this Guaranty Agreement shall terminate and each of the Guarantors shall be absolutely,
unconditionally and irrevocably released and discharged of any and all obligations hereunder
upon (a) the indefeasible payment in full of the Notes, (b) with respect to Marathon, payment
of the Marathon Pro Rata Portion of the Guaranteed Obligations and (c) with respect to the
TEPPCO Guarantors, payment of the TEPPCO Pro Rata Portion of the Guaranteed Obligations.
	 
	14.	 	PAYMENTS DUE ON NON-BUSINESS DAYS. Anything in this Guaranty Agreement to the contrary
notwithstanding, any payment of a Credit Fee that is due hereunder on a date other than a
Business Day shall be made on the next succeeding Business Day without including the
additional days elapsed in the computation of the Credit Fee payable on such next succeeding
Business Day.
	 
	15.	 	NOTICES. Unless otherwise specifically provided herein, all notices, consents, directions,
approvals, instructions, requests and other communications required or




18









 






	 	 	permitted by the terms hereof shall be in writing, and any such communication shall become
effective when received, addressed in the following manner: (a) if to any TEPPCO Guarantor,
to it at 1100 Louisiana Street, Houston, TX 77002, Attention: General Counsel, (b) if to
Marathon, to it at 5555 San Felipe Road, Houston, Texas 77056, Attention: Treasurer, or
(c) if to any holder of a Note, to the respective addresses set forth in the Information
Schedule to the Shelf Agreement; provided, however, that any such addressee
may change its address for communications by notice given as aforesaid to the other parties
hereto.
	 
	16.	 	CONSTRUCTION. The section and subsection headings in this Guaranty Agreement are for
convenience of reference only and shall neither be deemed to be a part of this Guaranty
Agreement nor modify, define, expand or limit any of the terms or provisions hereof. All
references herein to numbered sections, unless otherwise indicated, are to sections of this
Guaranty Agreement. Words and definitions in the singular shall be read and construed as
though in the plural and vice versa, and words in the masculine, neuter or
feminine gender shall be read and construed as though in either of the other genders where the
context so requires.
	 
	17.	 	SEVERABILITY. If any provision of this Guaranty Agreement, or the application thereof to any
person or circumstances, shall, for any reason or to any extent, be invalid or unenforceable,
such invalidity or unenforceability shall not in any manner affect or render invalid or
unenforceable the remainder of this Guaranty Agreement, and the application of that provision
to other persons or circumstances shall not be affected but, rather, shall be enforced to the
extent permitted by applicable law.
	 
	18.	 	SUCCESSORS. The terms and provisions of this Guaranty Agreement shall be binding upon and
inure to the benefit of each of the Guarantors and the holders of the Notes from time to time
and their respective permitted successors, transferees and assigns.
	 
	19.	 	ENTIRE AGREEMENT; AMENDMENT. This Guaranty Agreement expresses the entire understanding of
the subject matter hereof; and all other understandings, written or oral, are hereby merged
herein and superseded. No amendment of or supplement to this Guaranty Agreement, or waiver or
modification of, or consent under, the terms hereof shall be effective unless in writing and
signed by the party to be bound thereby.
	 
	20.	 	TERM OF GUARANTY AGREEMENT. Except if released in accordance with Section 13 hereof, the
Guaranty Agreement and all guarantees, covenants and agreements of each of the Guarantors
contained herein shall continue in full force and effect and shall not be discharged (a) with
respect to Marathon, until such time as the Marathon Pro Rata Portion of the Guaranteed
Obligations shall be paid or otherwise discharged in full and (b) with respect to the TEPPCO
Guarantors, until such time as the TEPPCO Pro Rata Portion of the Guaranteed Obligations shall
be paid or otherwise discharged in full.
	 
	21.	 	SURVIVAL. All warranties, representations and covenants made by each of the Guarantors
herein or in any certificate or other instrument delivered by such Guarantor or on such
Guarantor’s behalf under this Guaranty Agreement shall be considered to have




19









 






	 	 	been relied upon by the holders of the Notes and shall survive the execution and delivery of
this Guaranty Agreement, regardless of any investigation made by the holder of the Notes or
on their behalf.
	 
	22.	 	FURTHER ASSURANCES. Each of the Guarantors hereby agrees to execute and deliver all such
instruments and take all such action as the holders of the Notes may from time to time
reasonably request in order to effectuate fully the purposes of this Guaranty Agreement.
	 
	23.	 	GOVERNING LAW. This Guaranty Agreement has been executed and delivered in the State of New
York and shall be governed by, construed and enforced in all respects in accordance with the
laws of the State of New York applicable to contracts made and to be performed entirely
therein, without regard to principles of conflicts of laws.
	 
	24.	 	SUBMISSION TO JURISDICTION. Each of the Guarantors hereby irrevocably submits itself to the
nonexclusive jurisdiction of the Supreme Court of the State of New York, New York County, of
the United States of America and to the jurisdiction of the United States District Court for
the Southern District of New York, for the purpose of any suit, action or other proceeding
arising out of, or relating to, this Guaranty Agreement or the subject matter hereof, and
hereby waives, and agrees not to assert, by way of motion, as a defense or otherwise, in any
such suit, action or proceedings, (i) any claim that it is not personally subject to the
jurisdiction of the above-named courts for any reason whatsoever, that such suit, action or
proceeding is brought in an inconvenient forum or that the venue of such suit, action or
proceeding is improper and (ii) any right which it may have to a trial by a jury. Any and all
service of process and any other notice in any such action, suit or proceeding shall be
effective against such parties if given by registered or certified mail, return receipt
requested, or by any other means or mail which requires a signed receipt, postage prepaid,
mailed to such parties has herein provided in Section 15.
	 
	25.	 	CONDITIONS TO EFFECTIVENESS. This Guaranty Agreement shall become effective on the date
hereof (the “Effective Date”), subject to the following conditions:






     (a) Certain Documents. Prudential shall have received the following, each duly
executed and in form, scope and substance satisfactory to Prudential:




	 	(i)	 	a counterpart of this Guaranty Agreement;
	 
	 	(ii)	 	a certificate of the Secretary or other officer of each TEPPCO
Guarantor (or, with respect to any Guarantor that is a limited partnership, of
its general partner and with respect to any Guarantor that is a member-managed
limited liability company, of its managing member), (A) attaching resolutions
evidencing approval of the transactions contemplated by this Guaranty Agreement
and any other documents to be executed and delivered in connection herewith or
therewith and the execution, delivery and performance thereof, authorizing
certain officers




20









 






	 	 	 	to execute and deliver the same, and certifying that such resolutions were
duly and validly adopted and have not since been amended, revoked or
rescinded, (B) attaching copies of the constitutive documents of each TEPPCO
Guarantor (or, with respect to any Guarantor that is a limited partnership,
of its general partner and with respect to any Guarantor that is a
member-managed limited liability company, of its managing member), as
applicable, or, in the case of TEPPCO, certifying that there have been no
changes to such constitutive documents since May 21, 2007, (C) certifying as
to the names, titles and true signatures of the officers or other authorized
persons of each TEPPCO Guarantor (or, with respect to any Guarantor that is
a limited partnership, of its general partner and with respect to any
Guarantor that is a member-managed limited liability company, of its
managing member), as applicable, authorized to sign, on behalf of such
Guarantor, this Guaranty Agreement and any other documents to be executed
and delivered in connection herewith or therewith, (D) attaching good
standing certificates from the jurisdiction of organization of each
Guarantor (and, with respect to any Guarantor that is a limited partnership,
its general partner and with respect to any Guarantor that is a
member-managed limited liability company, of its managing member), and
(E) certifying that no dissolution or liquidation proceedings as to any
Guarantor (and, with respect to any Guarantor that is a limited partnership,
its general partner and with respect to any Guarantor that is a
member-managed limited liability company, of its managing member), have been
commenced or are contemplated;
	 
	 	(iii)	 	a favorable opinion of special New York counsel to the TEPPCO
Guarantors and favorable opinions of counsel to each of the TEPPCO Guarantors
and, with respect to any TEPPCO Guarantor that is a limited partnership, of its
general partner and with respect to any Guarantor that is a member-managed
limited liability company, of its managing member (each such counsel to be
reasonably acceptable to such Purchaser), in each case in form, scope and
substance reasonably satisfactory to Prudential, and as to such matters as
Prudential may reasonably require; 
	 
	 	(iv)	 	any additional documents or certificates as may be reasonably
requested by Prudential; and
	 
	 	(v)	 	evidence, in form and substance satisfactory to Prudential,
that the conversion of TE Products Pipeline Company, Limited Partnership, a
Delaware limited partnership into TEPPCO satisfied all of the conditions set
forth in Section 10 (b) of the Original Sponsor Guaranty, such evidence to
include, without limitation, an officer’s certificate stating that such
conversion and the assumption agreement required by Section 10(b) (ii) of the
Original Sponsor Guaranty comply with the provisions of Section 10(b) of the
Original Sponsor Guaranty and that such officer has confirmed such compliance
with legal counsel not unsatisfactory to the
Majority Holder(s).




21









 












     (b) Representations and Warranties; No Default; No Material Adverse Effect.
After giving effect to this Guaranty Agreement and the transactions contemplated hereby,
(i) the representations and warranties of each Guarantor contained in this Guaranty
Agreement shall be true on and as of the date hereof, (ii) there shall exist on the date
hereof no Event of Default or Default (as such terms are defined in the Shelf Agreement),
and (iii) on the date hereof there shall exist or have occurred no condition, event or act
which could reasonably be expected to have a Material Adverse Effect.




     (c) Proceedings. All corporate, partnership, limited liability company and
other actions taken or to be taken in connection with the transactions contemplated hereby
and all documents incident to the foregoing shall be satisfactory in form, scope and
substance to Prudential, and Prudential shall have received all such counterpart originals
or certified or other copies of such documents as Prudential may reasonably request.




     (d) Fees. The Guarantors shall have paid all fees and expenses of Baker Botts
L.L.P, counsel to Prudential, as reflected in the statement of such counsel delivered to one
or more of the Guarantors prior to the date hereof.




	26.	 	RESTATEMENT OF ORIGINAL SPONSOR GUARANTY. The parties hereto agree that, on the Effective
Date: (a) the Guaranteed Obligations represent, among other things, the restatement, renewal,
amendment, extension, and modification of the “Guaranteed Obligations” as defined in the
Original Sponsor Guaranty; (b) this Guaranty Agreement is intended to, and does hereby,
restate, renew, extend, amend, modify, supersede, and replace the Original Sponsor Guaranty in
its entirety; and (c) the entering into and performance of their respective obligations under
this Guaranty Agreement and the transactions evidenced hereby do not constitute a novation nor
shall they be deemed to have terminated, extinguished, or discharged the “Guaranteed
Obligations” under the Original Sponsor Guaranty, or the other “Note Documents” executed in
connection with the Original Sponsor Guaranty, all of which shall continue under and be
governed by this Guaranty Agreement and the other Note Documents, except as expressly provided
otherwise herein or therein.






22











 





     IN WITNESS WHEREOF, each of the Guarantors has caused this Amended and Restated Guaranty
Agreement to be duly executed and delivered as of the date and year first above written.



	 	 	 	 	 	 	 	 	 
	 	 	TCTM, L.P.	 	 
	 
	 	 	 	 	 	 	 	 
	 	 	By:	 	TEPPCO GP, Inc., its sole general partner	 	 
	 
	 	 	 	 	 	 	 	 
	 

	 	 	 	By:
	 	/s/ William G. Manias
 

Name: William G. Manias
	 	 
	 

	 	 	 	 	 	Title: Vice President and Chief Financial
Officer	 	 
	 
	 	 	 	 	 	 	 	 
	 	 	TEPPCO MIDSTREAM COMPANIES, LLC	 	 
	 
	 	 	 	 	 	 	 	 
	 	 	By:	 	TEPPCO GP, Inc., its sole manager	 	 
	 
	 	 	 	 	 	 	 	 
	 

	 	 	 	By:
	 	/s/ William G. Manias
 

Name: William G. Manias
	 	 
	 

	 	 	 	 	 	Title: Vice President and Chief Financial
Officer	 	 
	 
	 	 	 	 	 	 	 	 
	 	 	TEPPCO PARTNERS, L.P.	 	 
	 
	 	 	 	 	 	 	 	 
	 	 	By:	 	Texas Eastern Products Pipeline Company, LLC,

its sole general partner	 	 
	 
	 	 	 	 	 	 	 	 
	 

	 	 	 	By:
	 	/s/ William G. Manias
 

Name: William G. Manias
	 	 
	 

	 	 	 	 	 	Title: Vice President and Chief Financial
Officer	 	 
	 
	 	 	 	 	 	 	 	 
	 	 	TE PRODUCTS PIPELINE COMPANY, LLC	 	 
	 
	 	 	 	 	 	 	 	 
	 	 	By:	 	TEPPCO GP, Inc., its sole manager	 	 
	 
	 	 	 	 	 	 	 	 
	 

	 	 	 	By:
	 	/s/ William G. Manias
 

Name: William G. Manias
	 	 
	 

	 	 	 	 	 	Title: Vice President and Chief Financial
Officer	 	 






Signature Page to Guaranty Agreement




 









 








	 	 	 	 	 	 	 
	 	 	MARATHON OIL CORPORATION	 	 
	 
	 	 	 	 	 	 
	 

	 	By:
	 	/s/ Paul C. Reinboll
 

Name: Paul C. Reinboll
	 	 
	 

	 	 	 	Title: VP Finance and Treasurer	 	 






Signature Page to Guaranty Agreement




 









 








Agreed to as of the Effective Date:




THE PRUDENTIAL INSURANCE COMPANY

    OF AMERICA




	 	 	 	 	 
	By:

	 	/s/ Brian Thomas
 

Vice President
	 	 






Signature Page to Guaranty Agreement