**Exhibit 10.9**

 

**AMENDEDAND RESTATED**

**AGREEMENTOF LIMITED PARTNERSHIP**

**OF**

**GREAT LAKES GASTRANSMISSION**

**LIMITED PARTNERSHIP**

 

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**TABLE OF CONTENTS**
|                                                                                                            | **Page** |
|------------------------------------------------------------------------------------------------------------|----------|
| ** **                                                                                                 |     |
| **ARTICLE I ORGANIZATIONAL MATTERS**                                                                       |     |
| 1.1 Formation                                                                                              | 1        |
| 1.2 Name                                                                                                   | 1        |
| 1.3 Purpose                                                                                                | 1        |
| 1.4 Registered Office;  Principal Office                                                                   | 1        |
| 1.5 Qualification in  other Jurisdictions                                                                  | 2        |
| 1.6 Term                                                                                                   | 2        |
|                                                                                                       |     |
| **ARTICLE II DEFINITIONS**                                                                                 |     |
| ** **                                                                                                 |     |
| **ARTICLE III CAPITAL CONTRIBUTIONS**                                                                      |     |
| 3.1 Capital  Contributions                                                                                 | 6        |
| 3.2 Additional Capital  Contributions and Issuances of Limited Partnership Interests and other  Securities | 6        |
| 3.3 Capital Accounts                                                                                       | 8        |
| 3.4 No Preemptive  Rights                                                                                  | 10       |
| 3.5 Interest                                                                                               | 10       |
| 3.6 No Withdrawal                                                                                          | 10       |
| 3.7 Loans from Partners                                                                                    | 11       |
| 3.8 Voluntary  Contributions                                                                               | 11       |
|                                                                                                       |     |
| **ARTICLE IV ALLOCATIONS AND DISTRIBUTIONS**                                                               |     |
| 4.1 Allocations for  Capital Account Purposes                                                              | 11       |
| 4.2 Allocations for Tax  Purposes                                                                          | 13       |
| 4.3 General Partners                                                                                       | 14       |
| 4.4 Distributions                                                                                          | 14       |
|                                                                                                       |     |
| **ARTICLE V ACCOUNTING AND TAXATION**                                                                      |     |
| 5.1 Fiscal Year                                                                                            | 14       |
| 5.2 Location of Records                                                                                    | 14       |
| 5.3 Books of Account                                                                                       | 14       |
| 5.4 Annual Financial  Statements and Tax Information                                                       | 14       |
| 5.5 Taxation                                                                                               | 15       |
| 5.6 Governmental  Reports                                                                                  | 16       |
| 5.7 Inspection of  Facilities and Records                                                                  | 16       |
| 5.8 Deposit and  Withdrawal of Funds                                                                       | 16       |

 

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|                                                                       | **Page** |
|-----------------------------------------------------------------------|----------|
| ** **                                                            |     |
| **ARTICLE VI MANAGEMENT OF THE PARTNERSHIP**                          |     |
| 6.1 Control by General  Partners                                      | 16       |
| 6.2 Management  Committee                                             | 17       |
| 6.3 Management  Officials                                             | 20       |
| 6.4 Compensation and  Reimbursement of the General Partners           | 22       |
| 6.5 Outside Activity                                                  | 22       |
| 6.6 Dealings with the  General Partners                               | 22       |
| 6.7 Indemnification                                                   | 23       |
| 6.8 Liability                                                         | 24       |
| 6.9 Other Matters  Concerning the General Partners                    | 25       |
| 6.10 Title to  Partnership Assets                                     | 25       |
|                                                                  |     |
| **ARTICLE VII LIMITATION OF LIABILITIES**                             |     |
| 7.1 Limitation of  Liability of Limited Partners                      | 26       |
| 7.2 Limitation of  Authority of Partners                              | 26       |
| 7.3  Cross-Indemnification                                            | 26       |
| 7.4 Limited Recourse                                                  | 26       |
|                                                                  |     |
| **ARTICLE VIII TRANSFER OR PLEDGE OF PARTNERSHIP  INTERESTS**         |     |
| 8.1 Additional  Definitions                                           | 27       |
| 8.2 Transfer                                                          | 28       |
| 8.3 Right of First  Refusal                                           | 29       |
| 8.4 Mechanics of  Transfer                                            | 29       |
| 8.5 Further  Restrictions on Transfer                                 | 30       |
|                                                                  |     |
| **ARTICLE IX ADMISSION OF PARTNERS**                                  |     |
| 9.1 Admission of  Additional Limited Partners                         | 30       |
| 9.2 Admission of  Additional General Partners                         | 30       |
| 9.3 Admission of  Successor General Partners                          | 30       |
| 9.4 Amendment of  Agreement and of Certificate of Limited Partnership | 30       |
|                                                                  |     |
| **ARTICLE X WITHDRAWAL AND REMOVAL OF PARTNERS**                      |     |
| 10.1 Withdrawal of  General Partners                                  | 31       |
| 10.2 Removal of General  Partners                                     | 31       |
| 10.3 Withdrawal of  Limited Partners                                  | 31       |
| 10.4 Liability of  Withdrawing Partner                                | 31       |
|                                                                  |     |
| **ARTICLE XI DISSOLUTION AND LIQUIDATION**                            |     |
| 11.1 Dissolution                                                      | 31       |

 

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|                                                                            | **Page** |
|----------------------------------------------------------------------------|----------|
|                                                                       |     |
| 11.2 Winding Up and  Liquidation                                           | 32       |
| 11.3 Cancellation of  Certificate of Limited Partnership                   | 32       |
| 11.4 Return of Capital                                                     | 32       |
| 11.5 Waiver of  Partition                                                  | 33       |
| 11.6 Continuance of  Partnership                                           | 33       |
| 11.7 Termination  Subject to Natural Gas Act                               | 33       |
|                                                                       |     |
| **ARTICLE XII AMENDMENT OF PARTNERSHIP AGREEMENT;  MEETINGS; RECORD DATE** |     |
| 12.1 Amendments to be  Adopted Solely by the General Partners              | 34       |
| 12.2 Amendment  Procedures                                                 | 35       |
|                                                                       |     |
| **ARTICLE XIII DISPUTE RESOLUTION**                                        |     |
| 13.1 Agreement to  Arbitrate                                               | 35       |
| 13.2 Procedure                                                             | 35       |
|                                                                       |     |
| **ARTICLE XIV GENERAL PROVISIONS**                                         |     |
| 14.1 Notices                                                               | 36       |
| 14.2 Further Assurances                                                    | 37       |
| 14.3 Applicable Law                                                        | 37       |
| 14.4 Counterparts                                                          | 37       |
| 14.5 Headings                                                              | 37       |
| 14.6 Waiver                                                                | 37       |
| 14.7 Laws and  Regulatory Bodies                                           | 37       |
| 14.8 Section Numbers                                                       | 37       |
| 14.9 References to  Money                                                  | 37       |
| 14.10 Severability                                                         | 37       |
| 14.11 Third Persons                                                        | 38       |
| 14.12 Binding Effect                                                       | 38       |
| 14.13 Integration                                                          | 38       |
| 14.14 Survival                                                             | 38       |

 

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**AMENDED AND RESTATEDAGREEMENT OF LIMITED PARTNERSHIPOFGREAT LAKES GAS TRANSMISSION LIMITED PARTNERSHIP**

This AMENDED ANDRESTATED AGREEMENT OF LIMITED PARTNERSHIP is entered into by and amongTransCanada GL, Inc., a Delaware corporation, TC GL Intermediate LimitedPartnership, a Delaware limited partnership and Great Lakes Gas TransmissionCompany, a Delaware corporation.

All capitalized terms used herein and nototherwise defined are defined in Article II.

**ARTICLE IORGANIZATIONAL MATTERS**

1.1           Formation.  On April 5, 1990, theCertificate of Limited Partnership was filed with the Secretary of State of theState of Delaware in accordance with the Partnership Act, thereby forming thePartnership. The General Partners shall execute and cause to be filed, as appropriate,such further amendments to the Certificate of Limited Partnership and otherdocuments as are or become necessary or advisable, as determined by the GeneralPartners acting through the Management Committee.  The Partners hereby amend and restate thePrior Agreement in its entirety. This amendment and restatement shall becomeeffective on the date of this Agreement.

1.2           Name.  The name of thePartnership shall be, and the business of the Partnership shall be conductedunder the name of, “Great Lakes Gas Transmission Limited Partnership”.  The words “Limited Partnership” or theabbreviation “L.P.” shall be included in the Partnership’s name where necessaryfor the purposes of complying with the laws of any jurisdiction that sorequires.  The General Partners maychange the name of the Partnership upon written notice to the Partners, withsuch variations thereof as may be necessary to comply with the laws of otherstates, or Canadian provinces, within which the Partnership may do business.

1.3           Purpose.  The purpose and businessof the Partnership shall be any business that may lawfully be conducted by alimited partnership organized pursuant to the Partnership Act, including,without limitation, the management, operation and disposition of the InitialFacilities and any Incremental Expansion; the carrying on of any businessrelating thereto or arising therefrom; the entering into of any partnership,joint venture or other similar arrangement to engage in any of the foregoing orthe ownership of interests in any entity engaged in any of the foregoing; andanything incidental or necessary to the foregoing.

1.4           RegisteredOffice; Principal Office.  The address of the registered office of the Partnership in thestate of Delaware shall be Corporation Trust Company, 1209 Orange Street,Wilmington, New Castle County, Delaware, and the registered agent for serviceof process on the Partnership in the State of Delaware at such registeredoffice shall be The Corporation Trust Company. The principal office of the Partnership shall be 5250 Corporate Drive,Troy, MI 48098, or such other place as the Management Committee may from timeto time determine.  Written notice of anychange in such offices shall be given to each Partner.

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1.5           Qualificationin other Jurisdictions.  The General Partners shall cause the Partnership to be qualifiedor registered under assumed or fictitious names or foreign limited partnershipstatutes or similar laws, or take other appropriate action, in any jurisdictionin which the Partnership owns property or transacts business if suchqualification, registration or other appropriate action is reasonably necessaryor reasonably anticipated to be necessary, in order to protect the limitedliability of the Limited Partner(s), or to permit the Partnership lawfully toown property or transact business in such jurisdiction.  The General Partners shall execute and causeto be filed and published all such certificates, notices, statements or otherinstruments reasonably necessary or reasonably anticipated to be necessary topermit the Partnership to conduct business as a limited partnership in alljurisdictions where the Partnership elects to do business and to maintain thelimited liability of the Limited Partner(s).

1.6           Term.  The Partnershipcommenced upon the filing of the Certificate of Limited Partnership of thePartnership in accordance with the Partnership Act and shall continue inexistence until April 5, 2040, or until the earlier termination of thePartnership in accordance with the provisions of Article XI.

**ARTICLE IIDEFINITIONS**

The followingdefinitions shall be for all purposes, unless otherwise clearly indicated tothe contrary, applied to the terms used in this Agreement.

Additional LimitedPartner.  A Partneradmitted to the Partnership as a Limited Partner pursuant to Section 9.2 andshown as a Limited Partner on the books of the Partnership.

Adjusted Basis.  With respect to Partnership assets as of anydate of determination, the Partnership’s adjusted basis of such assets, asdetermined for Federal income tax purposes, pursuant to Section 1011 of theCode.

Adjusted CapitalAccount Deficit.  Withrespect to any Partner, the deficit balance, if any, in such Partner’s CapitalAccount as of the end of the relevant fiscal year or other period, after givingeffect to the following adjustments:

(a)           Credit to such Capital Account anyamounts that such Partner is obligated to restore or is deemed to be obligatedto restore pursuant to the penultimate sentences of Treasury Regulation Section1.704-1T(b)(4)(iv)(f) and 1.704-1T(b)(4)(iv)(h)(5), as the case may be;

(b)           Debit to such Capital Account theitems described in Treasury Regulation Sections 1.704-1(b)(2)(ii)(d)(4),1.704-1(b)(2)(ii)(d)(5) and 1.704-1(b)(2)(ii)(d)(6), taking into account for purposesof this third cited Treasury Regulation Section any offsetting increasedescribed in the proviso of Treasury Regulation Section1.704-1T(b)(4)(iv)(e)(3); and

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(c)           Credit and debit to such CapitalAccount, in the sole discretion of the Management Committee, any other itemsrequired or permitted under Section 704(b) of the Code and Treasury Regulationsthereunder.

Adjusted Property.  A Partnership property, the Carrying Value ofwhich has been adjusted pursuant to Section 3.3(c).

Affiliate.  Any Person which, directly or indirectlythrough one or more intermediaries, controls or is controlled by or is undercommon control with any Person, including, but not limited to: (a) a Parent ofa Partner; (b) a corporation more than 50% of the outstanding voting stock ofwhich is owned directly or indirectly by a Partner or a Parent of a Partner; or(c) a corporation more than 50% of the outstanding voting stock of which isowned directly or indirectly by a corporation more than 50% of the outstandingvoting stock of which is owned directly or indirectly by a Partner or by aParent of a Partner.  For the purposes ofthis Agreement, no General Partner shall be considered to be an Affiliate ofany other General Partner.

Agreed Value.  With respect to any property contributed tothe Partnership or distributed by the Partnership to any Partner, the grossfair market value of such property (i.e., without regard to any liabilitiesassumed by the Partnership or to which such property is subject) as determinedin good faith by the Management Committee.

Agreement.  This Amended and Restated Agreement ofLimited Partnership, as it may be amended, supplemented or restated from timeto time.

Arbitrator.  Arbitrator shall have the applicable meaningset forth in Section 13.2.

Capital Account.  The capital account maintained for a Partnerpursuant to Section 3.3.  The CapitalAccounts of the Partners established pursuant to this Agreement shall not bedeemed to be, nor have the same meaning as, the capital account of thePartnership under the Natural Gas Act.

CapitalContribution.  Any cashor Contributed Property that a Partner has contributed to the Partnership as ofthe date of this Agreement or will contribute to the Partnership pursuant toArticle III.

Carrying Value.  With respect to (a) any Contributed Property,the Agreed Value of such property and (b) any property other than ContributedProperty, the Adjusted Basis of such property for Federal income tax purposes,in both cases reduced (but not below zero) by all depreciation and costrecovery deductions charged to the Partners’ Capital Accounts.  The Carrying Value of the Partnershipproperties shall be adjusted from time to time in accordance with Section3.3(c) and to reflect additions to basis and other adjustments deemedappropriate by the Management Committee in accordance with the terms of thisAgreement.

Certificate ofLimited Partnership. The Certificate of Limited Partnership with respect to the Partnershipthat was filed with the Secretary of State of the State of Delaware on April 5,1990.

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Certified PublicAccountants.  A firm ofindependent public accountants selected from time to time by the ManagementCommittee.

Code.  The Internal Revenue Code of 1986, as amended(and any successor thereto).

Contributed Property.  Each Contributing Partner’s interest in eachproperty (at the time of contribution to the Partnership) or otherconsideration, in such form as may be permitted by the Partnership Act, butexcluding cash, contributed to the Partnership by such Contributing Partner,including the Initial Facilities.

ContributingPartner.  Each Partnercontributing a Contributed Property to the Partnership in exchange for aPartnership Interest.

DOE.  The Department of Energy or any department,commission, agency or other governmental body succeeding to the powers of suchdepartment.

Event ofWithdrawal.  An eventof withdrawal as specified in Section 17-402 of the Partnership Act.

Facilities.  The Initial Facilities and any and allIncremental Expansions.

FERC.  The Federal Energy Regulatory Commission orany commission, agency or other governmental body succeeding to the powers ofsuch commission.

General Partner.  TransCanada GP, TCGL GP or any successor toeither such Person in its respective capacity as a general partner of thePartnership.

GeneralPartnership Interest. A Partnership Interest of a General Partner in its capacity as a GeneralPartner.

Great Lakes.  Great Lakes Gas Transmission Company, aDelaware corporation.

IncrementalExpansion.  Anyfacilities installed to modify, improve or expand the Facilities or any portionthereof, except in connection with customary maintenance, to permit thedelivery capacity of the Initial Facilities to be increased after the date ofthis Agreement.

Initial Facilities.  The real, personal and mixed property(whether tangible or intangible) owned and operated by the Partnership for thetransmission of natural gas as of the date of this Agreement.

Limited Partner.  (a) Great Lakes, (b) any Additional LimitedPartner and (c) any Substituted Limited Partner, but excluding any Person whotransfers its Limited Partnership Interest to any Substituted Limited Partnerin accordance with the terms hereof.

LimitedPartnership Interest. A Partnership Interest of a Limited Partner in its capacity as a LimitedPartner.

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Majority Interest.  Limited Partners holding more than 50% of theaggregate Percentage Interest of all Limited Partners.

ManagementCommittee.  TheManagement Committee provided for in Article VI.

Minimum Gain.  Minimum Gain shall have the meaning set forthin Section 4.1(c) hereof.

Net Agreed Value.  (a) In the case of any Contributed Property,the Agreed Value of such property or other consideration reduced by anyindebtedness or liabilities either assumed by the Partnership upon suchcontribution or to which such property is subject when contributed and (b) inthe case of any property distributed to a Partner pursuant to Article IV ordistributed to a Partner in liquidation of the Partnership pursuant to ArticleXI, the fair market value of such property at the time such property isdistributed (as determined under such provisions of this Agreement) reduced byany indebtedness either assumed by such Partner upon such distribution or towhich such property is subject when distributed.

OperatingAgreement.  TheOperating Agreement dated April 5, 1990 between Great Lakes and thePartnership, as it may be amended, supplemented or restated from time to timewith the approval of the Management Committee.

Parent.  Any Person which owns, directly orindirectly, more than 50% of the outstanding equity interests of a Partner.

Partner.  Each of the Persons executing this Agreement(whether so executing as a General Partner or a Limited Partner), anySubstituted Limited Partner and any Additional Limited Partner, but excludingany Person for whom another Person has been substituted as a Partner in thePartnership pursuant to this Agreement.

Partnership.  The Delaware limited partnership formedpursuant to Section 1.1 of this Agreement.

Partnership Act.  The Revised Uniform Limited Partnership Actof the State of Delaware, as amended.

PartnershipInterest.  The interestof a Partner in the Partnership.

PercentageInterest.  As to eachPartner, the percentage set forth opposite the Partner’s name on the Scheduleof Percentage Interests attached hereto as Exhibit A (as such Exhibit may beupdated from time to time to account for any Additional Limited Partners orSubstituted Limited Partners).

Person.  An individual, corporation, voluntary association,joint stock company, business trust, partnership or other entity.

Prior Agreement.  The Agreement of Limited Partnership of thePartnership dated as of April 5, 1990.

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Recapture Income.  Any gain recognized upon the sale or othertaxable disposition of a Partnership asset that is not capital gain becausesuch gain represents the recapture of deductions previously taken for federalincome tax purposes with respect to the asset.

RequiredAccounting Practice. The accounting rules and regulations, if any, at the time prescribed bythe regulatory body or bodies under the jurisdiction of which the Partnershipis at the time operating and, to the extent of matters not covered by suchrules and regulations, generally accepted accounting principles as practiced inthe United States at the time prevailing for companies engaged in a businesssimilar to that of the Partnership.

Section 754Election.  An electionunder Section 754 of the Code relating to the adjustment of the adjusted basisof the Partnership Assets as provided in Sections 734 and 743 of the Code.

SubstitutedLimited Partner.  APerson who becomes a Limited Partner to the Partnership pursuant to ArticleVIII in place of and with all the rights of a Limited Partner.

TCGL GP.  TC GL Intermediate Limited Partnership, aDelaware limited partnership.

TransCanada GP.  TransCanada GL, Inc., a Delaware corporation.

TreasuryRegulations.  Theregulations promulgated under the Code, as such regulations may be amended fromtime to time.

Unrealized Gain.  The excess, if any, of the fair market valueof Partnership property (as determined under Section 3.3(c)) as of the date ofdetermination over the Carrying Value of such property as of such date ofdetermination.

Unrealized Loss.  The excess, if Any, of the Carrying Value ofPartnership property (as determined under Section 3.3(c)) as of the date ofdetermination over the fair market value of such property as of such date ofdetermination.

**ARTICLE IIICAPITAL CONTRIBUTIONS**

3.1           Capital Contributions.  As of the execution of this Agreement, theinitial Percentage Interest of each Partner is as set forth in Exhibit A.  The General Partners shall from time to timeupdate Exhibit A to reflect any changes in Percentage Interests and/or anyAdditional Limited Partners and Substituted Limited Partners, in each case ascontemplated by, and in accordance with the terms and conditions of, thisAgreement.

3.2           Additional Capital Contributionsand Issuances of Limited Partnership Interests and other Securities. Inorder to raise additional capital or to acquire assets, to redeem or retirePartnership debt, or for any other Partnership purposes, the ManagementCommittee is authorized (x) to cause the General Partners to make a capitalcontribution to the Partnership, or (y) to cause the Partnership to issueLimited Partnership Interests at any time or from time to time to any GeneralPartner, to Limited Partners or to other Persons and to admit them to the

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Partnership as Additional Limited Partners, allwithout any consent or approval of the Limited Partners or any percentagethereof.  With respect to any additionalcapital contribution or issuance of Limited Partnership Interests hereunder,the Management Committee shall have sole and complete discretion in determiningthe resulting Percentage Interest of each Partner, the allocations of items ofPartnership income, gain, loss, deduction and credit to each Partner and theconsideration and terms and conditions with respect to any future issuance ofLimited Partnership Interests.  Inaddition, the Management Committee shall have sole and complete discretion tocause the Partnership to issue Limited Partnership Interests from time to timein one or more classes, or one or more series of such classes, with suchdesignations, preferences and relative, participating, optional or otherspecial rights, powers and duties, including rights, powers and duties seniorto existing classes and series of Limited Partnership Interests, as shall befixed by the Management Committee in the exercise of its sole and completediscretion, including, without limitation, (i) the allocation of items ofPartnership income, gain, loss, deduction and credit to each such class orseries of Limited Partnership Interests; (ii) the right of each such class or seriesof Limited Partnership Interests to share in Partnership distributions; (iii)the rights of each such class or series of Limited Partnership Interests upondissolution and liquidation of the Partnership; (iv) the price at which and theterms and conditions upon which each such class or series of LimitedPartnership Interests may be redeemed by the Partnership; (v) the rate at whichand the terms and conditions upon which each such class or series of LimitedPartnership Interests may be converted into another class or series of LimitedPartnership Interests of the Partnership; (vi) the terms and conditions uponwhich each such class or series of Limited Partnership Interests will beissued, evidenced by certificates and assigned or transferred; and (vii) theright of each such class or series of Limited Partnership Interests to vote onPartnership matters, including matters relating to the relative rights,preferences and privileges of each such class or series.  Upon or prior to the issuance of any class orseries of Limited Partnership Interests that shall not be identical to theLimited Partnership Interests that have been issued to the then LimitedPartners, the General Partners, without the consent at the time of any Partner,each Partner hereby consenting to any and each such amendment, may amend anyprovision of this Agreement and the General Partners may execute, swear to,acknowledge, deliver, file and record such documents as the General Partnersacting through the Management Committee may in their sole discretion determineto be necessary or appropriate in connection therewith in order to reflect theauthorization and issuance of each such class or series of Limited PartnershipInterests and the relative rights and preferences as to the matters set forthin the preceding sentence.  TheManagement Committee is also authorized to cause the Partnership to issue anyother type of security (including, without limitation, secured and unsecureddebt obligations of the Partnership, debt obligations of the Partnershipconvertible into any class or series of Limited Partnership Interests that maybe issued by the Partnership, or options, rights, warrants or appreciationrights relating to any class or series of Limited Partnership Interests, anydebt obligations or any combination of any of the foregoing) from time to timeto any General Partner, Limited Partner or other Person on terms and conditionsestablished in the sole and complete discretion of the ManagementCommittee.  The Management Committeeshall do all things it deems to be appropriate or necessary to comply with thePartnership Act and are authorized and directed to do all things they deem tobe necessary or advisable in connection with any such future issuance,including compliance with any statute, rule, regulation or guideline of anyFederal, state or other governmental agency or any securities exchange on whichany such security is listed for trading.

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3.3           Capital Accounts.  (a) The Partnership shall maintain for each Partner a separate CapitalAccount in accordance with the rules of Treasury Regulation Section1.704-1(b)(2)(iv).  Such Capital Accountshall be credited with (i) the amount of cash and Net Agreed Value of propertycontributed to the Partnership pursuant to this Agreement and (ii) all items ofincome and gain (including income and gain exempt from tax) computed inaccordance with this Section 3.3 and allocated pursuant to Section 4.1 anddebited by (iii) the cash distributions and the Net Agreed Value of alldistributions of property made with respect to a Partnership Interest and (iv)all items of deduction and loss computed in accordance with this Section 3.3and allocated pursuant to Section 4.1.

(b)           For purposes of computing the amountof each item of income, gain, deduction or loss to be reflected in the CapitalAccounts of the Partners, the determination, recognition and classification ofsuch items shall be the same as its determination, recognition andclassification for Federal income tax purposes (including any method of depreciation,cost recovery or amortization used for this purpose), provided that:

(i)            In accordance with Section 704(b) ofthe Code, any deductions for depreciation, cost recovery or amortizationattributable to a Contributed Property shall be determined as if the AdjustedBasis of such property on the date it was contributed to the Partnership wasequal to the Agreed Value of such property. Upon an adjustment pursuant to Section 3.3(c) to the Carrying Value ofany Partnership Property subject to depreciation, cost recovery oramortization, any further deductions for such depreciation, cost recovery oramortization attributable to such property shall be determined as if theAdjusted Basis of such property was equal to the Carrying Value of suchproperty immediately following such adjustment. For any period, depreciation, cost recovery or amortization attributableto any property described in this Section 3.3(b)(i) shall be an amount thatbears the same relationship to the Agreed Value (in the case of ContributedProperty) or Carrying Value (immediately following any adjustment referred toin the preceding sentence), as the case may be, of such property at thebeginning of the period as the Federal income tax depreciation, cost recoveryor amortization deduction with respect to such property for the period bears tothe Adjusted Basis of such property at the beginning of the period; provided,that if such property has a zero Adjusted Basis, the depreciation, costrecovery or amortization may be determined under any reasonable method selectedby the Management Committee.  For allpurposes of this Section 3.3, depreciation, cost recovery or amortization shallbe in lieu of any Federal income tax depreciation, cost recovery or amortizationdeductions with respect to such property.

(ii)           Any item of income, gain, loss ordeduction attributable to the taxable disposition of any Partnership assetshall be determined by the Partnership as if the Adjusted Basis of such assetas of such date of disposition was equal in amount to the Partnership’sCarrying Value for such asset as of such date.

(iii)          If the Partnership’s Adjusted Basis inany property subject to depreciation or cost recovery is reduced for Federalincome tax purposes pursuant

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to Section 48(q)(1) or48(q)(3) of the Code, the amount of such reduction shall be treated as anadditional depreciation or cost recovery deduction in the year such property isplaced in service and shall be allocated among the Partners pursuant to Section4.1.  Any restoration of such basispursuant to Section 48(q)(2) of the Code shall be treated as an item of incomeor gain and allocated in the same manner to the Partners to whom such deemeddeduction was allocated.

(iv)          The computation of all items ofincome, gain, loss and deduction shall be made without regard to any Section754 Election which may be made by the Partnership (except to the extentrequired by Treasury Regulation Section 1.704-1(b)(2)(iv)(m)) and, as to thoseitems described in Section 705(a)(1)(B) or Section 705(a)(2)(B) of the Code(including items treated as Section 705(a)(2)(B) expenditures under TreasuryRegulation Section 1.704-1(b)(2)(iv)(i)), without regard to the fact that suchitems are not includable in gross income or are neither currently deductiblenor capitalizable for Federal income tax purposes.

(c)           (i)            Uponthe acquisition of an additional interest in the Partnership by any new orexisting Partner in exchange for more than a de minimis CapitalContribution, the Capital Accounts of all Partners (and the Carrying Values ofall Partnership properties) shall be adjusted upwards or downwards to reflectany Unrealized Gain or Unrealized Loss attributable to the Partnershipproperties as if such Unrealized Gain or Unrealized Loss has been recognizedupon an actual sale of such properties immediately prior to such issuance andwas allocated to the Partners, at such time, pursuant to Section 4.1.  In determining such Unrealized Gain orUnrealized Loss, the fair market value of Partnership property shall bedetermined by the Management Committee using such reasonable method ofvaluation as it deems appropriate.

(ii)           Immediately prior to the distributionof more than a de minimis amount of cash or any Partnership property asconsideration for an interest in the Partnership (whether in liquidation of thePartnership or otherwise), the Capital Accounts of all Partners (and theCarrying Value of all Partnership properties) shall, immediately prior to anysuch distribution, be adjusted upwards or downwards to reflect any UnrealizedGain or Unrealized Loss attributable to all Partnership properties as if suchUnrealized Gain or Unrealized Loss has been recognized upon an actual sale ofsuch properties immediately prior to such distribution and was allocated to thePartners, at such time, pursuant to Section 4.1.  In determining such Unrealized Gain orUnrealized Loss, the fair market value of Partnership property shall bedetermined by the Management Committee using such reasonable method ofvaluation as it deems appropriate.

(iii)          Notwithstanding anything to thecontrary in this Section 3.3(c), any adjustment pursuant to Section 3.3(c)(i)or 3.3(c)(ii) shall be made only if the Management Committee reasonablydetermines that such adjustment is necessary or appropriate to reflect therelative economic interests of the Partners in the Partnership.

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(d)           The determination of the amount ofany liability for purposes of this Section 3.3 (including, without limitation,the computation of Agreed Value, Unrealized Gain and Unrealized Loss) shall bemade in accordance with Section 752(c) of the Code and any other applicableprovisions of the Code and Treasury Regulations thereunder.

(e)           In the event all or a portion of aninterest in the Partnership is transferred in accordance with the terms of thisAgreement, the Capital Account of the transferee shall be determined inaccordance with Treasury Regulation Section l.704-1(b)(2)(iv)(1).

(f)            It is the intention of the Partnersthat Capital Accounts shall be determined in a manner so that the allocationsin, this Agreement will have, or be deemed to have, substantial economic effectunder Section 704(b) of the Code and Treasury Regulations thereunder.  In the event that the Management Committeedetermines that it is prudent to modify the manner in which Capital Accounts,or any debits or credits thereto (including, without limitation, debits orcredits relating to liabilities that are secured by contributed or distributedproperty or that are assumed by the Partnership or the Partners or their Affiliates)are computed in order to comply with such Treasury Regulations, the ManagementCommittee shall make such modification, but only if such modification is notlikely to have a material effect on the amounts distributable to the Partnerspursuant to Article XI.  In the eventthat unanticipated events might otherwise cause this Agreement not to complywith such Treasury Regulations, the Management Committee, consistent with theprior sentence, shall make such modifications as it deems appropriate.

(g)           Negative Capital Accounts.  Subject to Section 11.4, no Partner shall berequired to pay to the Partnership or to any other Partner or other Person anydeficit or negative balance which may exist in such Partner’s Capital Accountupon liquidation of the Partnership or such Partner’s interest in thePartnership.

3.4           No Preemptive Rights.  Except as otherwise provided in Articles X orXI hereof, no Partner shall have any preemptive or preferential right,including any such right with respect to (a) additional Capital Contributions;(b) issuance or sale of Partnership Interests, whether unissued, held in thetreasury or thereafter created; (c) issuance of any obligations, evidences ofindebtedness or other securities of the Partnership convertible into or exchangeablefor, or carrying or accompanied by any rights to receive, purchase or subscribeto, any such unissued Partnership Interests held in treasury; (d) issuance ofany right of, subscription to or right to receive, or any warrant or option forthe purchase of, any of the foregoing securities; or (e) issuance or sale ofany other securities that may be issued or sold by the Partnership.

3.5           Interest.  No interest shall be paid by the Partnershipon Capital Contributions or on balances in Partners’ Capital Accounts.

3.6           No Withdrawal.  Except as otherwise provided herein orconsented to by each of the General Partners, no Partner shall be entitled towithdraw any part of his or its (or his or its predecessor’s) CapitalContribution or Capital Account or to receive any distribution from thePartnership.

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3.7           Loans from Partners.  Loans by a Partner to the Partnership shallnot be considered Capital Contributions. If any Partner shall advance funds to the Partnership in excess of theamounts required hereunder to be contributed by him or it to the capital of thePartnership, the making of such advances shall not result in any increase inthe amount of the Capital Account of such Partner. The amounts of any suchadvances shall be a debt of the Partnership to such Partner and shall bepayable or collectible only out of the Partnership assets in accordance withthe terms and conditions upon which such advances are made.

3.8           Voluntary Contributions.  No Partner shall make any CapitalContribution except pursuant to this Article III.

**ARTICLE IVALLOCATIONS AND DISTRIBUTIONS**

4.1           Allocations for Capital AccountPurposes.  (a)  For purposes of maintaining the CapitalAccounts and determining the rights of the Partners among themselves, thePartnership items of income, gain, loss and deduction shall be computed asprovided in Section 3.3 and, except as provided below, shall be allocated amongthe Partners in proportion to their respective Percentage Interests.  Notwithstanding the foregoing, if, upon thesale or other taxable disposition of substantially all of the Partnership’sproperty, the Capital Accounts of the Partners are not in the ratio of thePercentage Interests of the Partners, gain or loss from such sale ordisposition shall be first allocated among the Partners to cause the CapitalAccounts to be in the ratio of such Percentage Interests, with the balance ofsuch gain or loss, if any, allocated among the Partners in proportion to theirrespective Percentage Interests.

(b)           In the event that any Partner unexpectedlyreceives an adjustment, allocation or distribution described in clauses (4),(5) or (6) of Treasury Regulation Section 1.704-1(b)(2)(ii)(d) that results insuch Partner having an Adjusted Capital Account Deficit, such Partner shall beallocated Partnership items of income and gain in an amount and mannersufficient to eliminate, to the extent required by such regulations, theAdjusted Capital Account Deficit of such Partner as quickly as possible;provided, that an allocation pursuant to this Section 4.1(b) shall be made onlyif and to the extent that such Partner would have an Adjusted Capital AccountDeficit after all other allocations provided for in this Section 4.1 have beententatively made as if this Section 4.1(b) were not in this Agreement.  This Section 4.1(b) is intended to constitutea “qualified income offset” within the meaning of Treasury Regulation Section1.704-1(b)(2)(ii)(d)(3) and shall be interpreted consistently with suchprovisions.

(c)           In accordance with and pursuant toTreasury Regulation Section 1.704-1T(b)(4)(iv)(e), (f) and (h), if there is anet decrease in the Partnership’s Minimum Gain during any taxable year, allPartners shall be allocated, before any other allocation is made of Partnershipitems for such taxable year, items of income and gain for such year (and, ifnecessary, subsequent years) in an amount equal to the greater of (a) each suchPartner’s share of the net decrease in Minimum Gain that is allocable to thedisposition of Partnership property subject to one or more nonrecourseliabilities of the Partnership, as determined pursuant to Treasury RegulationSection 1.704-1T(b)(4)(iv)(f) and (h), as

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applicable, or (b) ifsuch Partner would otherwise have an Adjusted Capital Account Deficit at theend of such year, an amount sufficient to eliminate such Adjusted CapitalAccount Deficit.  This Section 4.1(c) isintended to comply with the “minimum gain chargeback” requirement in suchTreasury Regulations and shall be interpreted consistently therewith.

(d)           All items of loss, deduction orexpenditure that in accordance with the principles of Treasury RegulationSection 1.704-1T(b)(4)(iv)(h)(3) are attributable to a Partner nonrecourse debt(as defined in Treasury Regulation Section 1.704-1T(b)(4)(iv)(k)(4)) shall beallocated to the Partner that bears the economic risk of loss with respect tosuch Partner nonrecourse debt within the meaning of Treasury Regulation Section1.704-1T(b)(4)(iv)(k)(1).

(e)           No allocation of loss or item thereofshall be made to any Partner to the extent such allocation would create orincrease an Adjusted Capital Account Deficit of such Partner.  Any losses or items thereof that cannot beallocated to Partners by reason of the prior sentence (the “Excess Loss”)shall, subject to the prior sentence, be allocated to the other Partners inproportion to such other Partners’ Percentage Interests, and this method ofallocation shall continue until such Excess Loss shall have been completelyallocated.

(f)            To the extent of any RecaptureIncome resulting from the sale or other taxable disposition of a Partnershipasset, the amount of any gain allocated to each of the Partners shall beRecapture Income to the extent such Partner (or a predecessor in interest) hasbeen allocated or has claimed any deduction directly or indirectly giving riseto the treatment of such gain as Recapture Income.

(g)           Notwithstanding any other provisionof this Section 4.1 other than Sections 4.1(b) through 4.1(e) (the “RequiredAllocations”), the Required Allocations shall be taken into account in makingthe allocations under Section 4.1(a) (the “Agreed Allocations”) so that, to theextent possible, the net amount of items of income, gain, loss and deductionallocated to each Partner pursuant to the Required Allocations and the AgreedAllocations, together, shall be equal to the net amount of such items thatwould have been allocated to each Partner under the Agreed Allocations had theRequired Allocations not otherwise been provided for in this Section 4.1.

(h)           It is the intent of the parties tothis Agreement that the chargeback provisions and the limitation on lossallocation provisions provided herein satisfy the “allocation of nonrecoursededuction” rules provided in Treasury Regulation Section 1.704-1T(b)(4)(iv) andthe requirements of Treasury Regulation Section 1.704-1T(b)(2)(ii)(d) (relatingto the alternate test for economic effect and qualified income offset).  It is further intended that the allocationsunder this Section shall effect an allocation for Federal income tax purposesin a manner so that allocations in this Agreement will have, or be deemed tohave, substantial economic effect under Section 704(b) of the Code and theTreasury Regulations promulgated thereunder. If for any reason the allocations contained in this Agreement shallconflict with the Treasury Regulation promulgated under Section 704 of the Code,the Management Committee may

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amend these provisions ifit receives an opinion of counsel that such an amendment is necessary toreflect allocations consistent with such regulations.

(i)            The Partnership shall allocate itemsof income, gain, loss, deduction and credit attributable to a PartnershipInterest that is assigned during a year between the assignor and assignee ofsuch Partnership Interest or to a newly issued Partnership interest inaccordance with any method that the Management Committee determines is likelyto be upheld under Section 706 of the Code.

4.2           Allocations for Tax Purposes.  (a)     ForFederal and state income tax purposes, except as otherwise provided in thisSection 4.2, each item of Partnership income, gain, loss and deduction shall beallocated to the Partners consistent with the allocations of income, gain, lossand deduction heretofore described in Section 4.1.

(b)           In accordance with Section 704(c) ofthe Code and the Treasury Regulations thereunder (and any correspondingprovisions of applicable state law), income, gain, loss, and deduction withrespect to any property contributed to the capital of the Partnership shall,solely for tax purposes, be allocated among the Partners so as to take accountof any variation between the adjusted basis of such property to the Partnershipfor Federal income tax purposes and its Agreed Value.

In the event the CarryingValue of any Partnership asset is adjusted pursuant to Section 3.3(c) hereof,subsequent allocations of income, gain, loss, and deduction with respect tosuch asset shall take into account any variation between adjusted basis of suchasset for Federal income tax purposes and its Carrying Value in the same manneras under Section 704(c) of the Code and the Treasury Regulations thereunder.

(c)           All items of income, gain, loss,deduction, credit and basis allocation recognized by the Partnership forFederal income tax purposes and allocated to the Partners in accordance withthe provisions hereof shall be determined without regard to any election underSection 754 of the Code that may be made by the Partnership; provided, thatsuch allocations, once made, shall be adjusted, as necessary or appropriate, totake into account those adjustments permitted by Sections 734 and 743 of theCode and, where appropriate, to provide only Partners recognizing gain onPartnership distributions covered by Section 734 of the Code with the Federalincome tax benefits attributable to the increased basis in Partnership propertyresulting from any election under Section 754 of the Code.

(d)           Any credits of the Partnership shallbe allocated to the Partners in accordance with their respective PercentageInterests or as required by the Code and Treasury Regulations thereunder.

(e)           Allocations pursuant to this Section4.2 are solely for Federal, state and local tax purposes and shall not affect,or in any way be taken into account in computing, any Partner’s Capital Accountor share of income, gain, loss and deduction or distributions pursuant to anyprovision of this Agreement.

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(f)            The Partners are aware of the incomeand other tax consequences of the allocations made by this Article IV andhereby agree to be bound by the provisions of this Article IV in reportingtheir shares of items of Partnership income, gain, loss, deduction and credit.

4.3           General Partners.  Notwithstanding anything to the contrary thatmay be expressed or implied in this Agreement, the interests of the GeneralPartners as General Partners, taken together, in each material item ofPartnership income, gain, loss, deduction or credit shall be equal to at least1% of each such item at all times during the existence of the Partnership,subject to the temporary allocations required under Section 704(b) and (c) ofthe Code provided for in this Agreement.

4.4           Distributions.  (a) Within 75 days after the end of each of its fiscal years, thePartnership shall distribute cash to the Partners in proportion to theirrespective Percentage Interests in an aggregate amount equal to the Federaltaxable income of the Partnership allocated to the Partners multiplied by thesum of the highest Federal corporate income tax rate (currently 35%) and anassumed combined state and local income tax rate of 3%.

(b)           Other than the distributions requiredto be made under Section 4.4(a) above, the Management Committee may from timeto time in its sole discretion cause the Partnership to distribute cash orother property to the Partners in accordance with their respective PercentageInterests.

(c)           No reimbursement for expenses madepursuant to this Agreement and no payment described in Section 707(c) of theCode shall be deemed to be distributions for purposes of this Agreement.

**ARTICLE VACCOUNTING AND TAXATION**

5.1           Fiscal Year.  The fiscal year of the Partnership shall bethe calendar year.

5.2           Location of Records.  The books of account for the Partnershipshall be kept and maintained at the principal office of the Partnership or at suchother place as the Management Committee shall determine.

5.3           Books of Account.  The books of account for the Partnershipshall be:

(a)           Maintained on an accrual basis inaccordance with Required Accounting Practice; and

(b)           Audited by the Certified PublicAccountants at the end of each fiscal year.

5.4           Annual Financial Statements andTax Information.  As soon aspracticable following the end of each fiscal year of the Partnership, theManagement Committee shall cause to be prepared and delivered to each Partner:

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(a)           A profit and loss statement and astatement of cash flow for such fiscal year and a balance sheet as of the endof such fiscal year, together with a report thereon of the Certified PublicAccountants; and

(b)           Such Federal, state and local incometax returns and such other accounting, tax information and schedules as shallbe necessary for the preparation by each Partner of its Federal, state andlocal income tax returns for such fiscal year.

5.5           Taxation.  The Parties intend that the Partnership shallbe treated as a “partnership” for Federal and state tax purposes.  The Partnership’s state and Federal incometax returns shall be approved by the Management Committee and subject to reviewby the Certified Public Accountants, counsel or other Person or Personsdesignated by the Management Committee for such purpose.  All of the Partnership elections for stateand Federal income tax purposes shall be determined by the ManagementCommittee.

(a)           Tax Controversies.  TransCanada GP is designated the “Tax MattersPartner” (as defined in Section 6231 of the Code), and is authorized andrequired to represent the Partnership (at the Partnership’s expense) inconnection with all examinations of the Partnership’s affairs by taxauthorities, including, without limitation, administrative and judicialproceedings, and to expend Partnership funds for professional services andcosts associated therewith; provided, however, that the Tax MattersPartner shall not take any action as such Tax Matters Partner unless suchaction shall have been approved by the Management Committee.  Each Partner agrees to cooperate with theManagement Committee and to do or refrain from doing any and all thingsreasonably required by the Management Committee to conduct such proceedings.

(b)           Withholding.  Notwithstanding any other provision of thisAgreement, the Management Committee is authorized to take any action that itdetermines to be necessary or appropriate to cause the Partnership to complywith any Federal, state and local withholding requirement with respect to anyallocation, payment or distribution by the Partnership to any Partner or otherPerson.  All amounts so withheld shall betreated as distributions to the Partners under Article IV or XI, as the casemay be.  If any such withholdingrequirement with respect to any Partner exceeds the amount distributable tosuch Partner under Article IV or XI, or if any such withholding requirement wasnot satisfied with respect to any amount previously allocated or distributed tosuch Partner under Article IV or XI, such Partner and any successor or assigneewith respect to such Partner’s interest in the Partnership hereby indemnifiesand agrees to hold harmless the General Partners and the Partnership for suchexcess amount or such withholding requirement, as the case may be.

(c)           Tax Elections.  The Partnership shall make the election underSection 754 of the Code in accordance with applicable Treasury Regulationsthereunder for the firstfiscal year in which such election could apply, subject to the reservation ofthe right to seek to revoke any such election upon the ManagementCommittee’s determination that such revocation is in the best interests of thePartners.  In addition to the foregoing,the Management Committee shall, in its sole discretion, determine whether tomake any other

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available tax electionsand select any other appropriate tax accounting methods and conventions for anypurpose under this Agreement.

5.6           Governmental Reports.  Under the direction of the Management Committee,the Partnership shall prepare and file, or cause to be prepared and filed, allreports prescribed by FERC and any other commission or governmental agencyhaving jurisdiction over the Partnership.

5.7           Inspection of Facilities andRecords.  Each Partner shall have theright at all reasonable times during usual business hours to inspect thefacilities of the Partnership and to audit, examine and make copies of thebooks of account and other records of the Partnership.  Such right may be exercised through any agentor employee of such Partner designated in writing by it or by an independentpublic accountant, petroleum engineer, attorney or other consultant sodesignated.  The Partner making therequest shall bear all costs and expenses incurred in any inspection,examination or audit made at such Partner’s behest.

5.8           Deposit and Withdrawal of Funds.  Funds of the Partnership shall be depositedin such banks or other depositories as shall be designated from time to time bythe Management Committee.  All withdrawalsfrom any such depository shall be made only as authorized by the ManagementCommittee and shall be made only by check, wire transfer, debit memorandum orother written instruction.

**ARTICLE VIMANAGEMENT OF THE PARTNERSHIP**

6.1           Control by General Partners.  The General Partners through the operation ofthe Management Committee shall conduct, direct and exercise full control overall activities of the Partnership. Except as otherwise expressly provided in this Agreement, all managementpowers over the business and affairs of the Partnership shall be exclusivelyvested in the General Partners which powers shall be exercised solely throughthe operation of the Management Committee, and no Limited Partner shall haveany management power over the business and affairs of the Partnership.  The General Partners through the operation ofthe Management Committee shall have full power and authority to do or cause thePartnership to do all things deemed necessary or desirable by them, in theirsole discretion, in connection with or to conduct the business of thePartnership, including, without limitation, (A) the establishing of reserves,the making of any expenditures, the lending of money, the borrowing of money,the guaranteeing or assumption of indebtedness and other liabilities, theissuance of indebtedness and other liabilities, the issuance of evidences ofindebtedness, and the securing of the same by mortgage, deed of trust, or otherlien or encumbrance, and the incurring of any obligations it deems necessaryfor the conduct of the activities of the Partnership, (B) the acquisition,disposition, mortgage, pledge, encumbrance, hypothecation or exchange of any orall of the assets of the Partnership and the merger of the Partnership with orinto another entity, (C) the use of the assets of the Partnership (including,without limitation, cash on hand) for any purpose and on any terms it sees fit,including, without limitation, the financing of the conduct of the operationsof the Partnership, the lending of funds to other Persons and the repayment ofobligations of the Partnership, (D) the negotiation and execution on any termsdeemed desirable in its sole

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discretion and the performance of any contracts,conveyances or other instruments that it considers useful or necessary to theconduct of the Partnership’s operations or the implementation of its powersunder this Agreement, (E) the distribution of Partnership cash, (F) theselection and dismissal of employees and outside attorneys, accountants,consultants and contractors and the determination of their compensation andother terms of employment or hiring, (G) the maintenance of insurance and theadoption of fringe benefit plans for the benefit of the Partnership, thePartners and officers, employees and agents of the Partnership as it deemsnecessary, (H) the formation of any further limited or general partnerships,joint ventures or other relationships that it deems desirable, (I) the controlof any matters affecting the rights and obligations of the Partnership,including, without limitation, the conduct of litigation, the incurring oflegal expenses and the settlement of claims and litigation, (J) the issuance,purchase, sale or other acquisition or disposition of Partnership Interests orany security of the Partnership, and the cancellation of acquired PartnershipInterests or any security of the Partnership, at such times and on such termsas they deem to be in the best interest of the Partnership and the Partners and(K) the acts necessary to enter into leases for real or personal property oragreements in connection with sale and leaseback transactions.  No General Partner shall have the power tobind the Partnership or otherwise undertake any action on behalf of the Partnershipwithout the consent of or at the direction of the Management Committee.

6.2           Management Committee.  (a) The General Partners hereby designate aManagement Committee to consist of six individual members; three of whom shallbe designated by TCGL GP (the “TCGL Committee Members”) and three of whom shallbe designated by TransCanada GP (the “TransCanada Committee Members”) (The TCGLCommittee Members and the TransCanada Committee Members are sometimeshereinafter referred to as the “Committee Members”).  The business of the Partnership shall bemanaged by the General Partners through the Management Committee which shallexercise all of the powers of the General Partners.  Each member of the Management Committee shallbe a duly authorized officer or representative of the entity that so designatedhim and shall be duly authorized to act on behalf of and bind such entity inits capacity as a general partner of the Partnership.  All actions taken by the members of theManagement Committee shall be taken by such individuals in their capacity as dulyauthorized agents for the General Partners. Each Committee Member shall remain a member of the Management Committeeuntil his successor has been duly designated, or upon his earlier resignationor removal.  Any Committee Member mayresign at any time upon notice to the Partnership and the GeneralPartners.  The TCGL Committee Members andthe TransCanada Committee Members may be removed with or without cause only byTCGL GP or TransCanada GP, respectively. Vacancies resulting from the removal, resignation or other incapacity ofa TCGL Committee Member or a TransCanada Committee Member may be filled only byTCGL GP or TransCanada GP, respectively.

(b)           The Management Committee may holdmeetings, both regular and special, either within or without the State ofDelaware, as follows:

(i)            The Management Committee shall holdregular meetings without notice at such time and at such place as may from timeto time be determined by the Management Committee.

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(ii)           At all meetings of the ManagementCommittee, the presence of four Committee Members shall constitute a quorum forthe transaction of business and the unanimous act of the Committee Memberspresent at any meeting at which there is a quorum shall be the act of theManagement Committee.  If a quorum shallnot be present at any meeting of the Management Committee, the ManagementCommittee members present thereat may adjourn the meeting from time to time,without notice other than announcement at the meeting, until a quorum shall bepresent.

(iii)          Any action required or permitted to betaken at any meeting of the Management Committee may be taken without ameeting, if all the members of the Management Committee consent thereto inwriting, and the writing or writings are filed with the minutes of proceedingsof the Management Committee.

(iv)          Committee Members may participate in ameeting of the Management Committee by means of a conference telephone orsimilar communications equipment by means of which all persons participating inthe meeting can hear each other, and participation in such a meeting shallconstitute presence in person at such meeting.

(c)           Without the requisite approval of theManagement Committee, the General Partners, the Management Committee and othercommittees of the Partnership, and the management officials, employees andagents of the Partnership, shall not, nor shall any of them permit, allow orcause the Partnership to:

(i)            amend, modify or waive any of theterms or conditions of this Agreement;

(ii)           admit any Person to the Partnershipas a general or limited partner or permit any Person to make a capitalcontribution to the Partnership;

(iii)          change rate schedules in effect orproposed at any time;

(iv)          execute any gas purchase, gas sale ortransportation contract;

(v)           enter into, execute, amend, modify orwaive any of the terms or conditions of the Operating Agreement or anyreplacement Operating Agreement;

(vi)          approve entering into of any contractwith an Affiliate of a Partner pursuant to Section 6.6(b);

(vii)         undertake any proposed IncrementalExpansion, or any other construction project or execute any constructioncontract which involves expenditures or commitments by the Partnership inexcess of $500,000;

(viii)        determine any tax or accounting electionor policy;

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(ix)           arrange for insurance, applicationsfor insurance policies and authorization of insurance contracts with respect toany property of the Partnership;

(x)            finance or refinance the Partnershipor authorize, issue and/or sell General or Limited Partnership Interests orother securities of the Partnership or create any lien on or security interestin any of the assets of the Partnership in connection therewith; provided thatthe Partnership may, in the normal course of business, borrow on an unsecuredbasis from commercial banks up to $1,000,000 at any one time outstandingwithout the approval of the Management Committee as herein required;

(xi)           grant any bonuses or options or makeother arrangements for the sale of Partnership Interests to officers oremployees, all employee pension or other benefit plans and arrangements;

(xii)          redeem or purchase PartnershipInterests or other outstanding securities of the Partnership or distribute cashor other assets of the Partnership to the Partners;

(xiii)         appoint or retain counsel, independentauditors and consultants;

(xiv)        file any application or other requestfor authority (including any material amendments thereto) with any governmentalauthority with respect to any of the foregoing including:

(A)          file any applicationfor, or commence any proceeding with respect to, obtaining any certificate ofpublic convenience and necessity or other certificate of authority from FERC orfrom any other governmental authority having jurisdiction over the Partnership,its business or assets,

(B)           file any applicationto FERC or any other governmental authority having jurisdiction for anyincrease, decrease or other change in the Partnership’s rates or other tariffprovisions, and

(C)           file anyapplication, declaration or registration statement to be filed with theSecurities and Exchange Commission; and

(xv)         file any suit, appeal or other courtproceeding in connection with any of the foregoing.

(d)           The General Partners hereby designatean Executive Committee which shall consist of three members:  one TCGL Committee Member, one TransCanadaCommittee Member and the President of the Partnership, who shall be anon-voting member of the Executive Committee and shall provide assistance tothe other members.  The Management Committeemay designate other committees, each such committee to consist of at least oneTCGL Committee Member and one TransCanada Committee Member.  To the extent provided by the ManagementCommittee, the Executive

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Committee and any othercommittee shall have and may exercise any or all of the powers of theManagement Committee in the management of the business of the Partnership,including the power to approve any or all of the designated actions set forthin Section 6.2(c), provided that with respect to any action set forth inSection 6.2(c) which is taken by a subcommittee, such action may be taken onlywith the unanimous consent of each voting member of the subcommittee.

6.3           Management Officials.  (a)    Other than asexpressly set forth in this Agreement, the Management Committee is hereby authorizedto (i) create titles for management officials of the Partnership; (ii)establish the power and authority associated with such titles to act as theagent of the General Partners to represent the Partnership in dealings withthird parties, provided that the General Partners shall have no power to grantto any management official any control over the affairs of the Partnership,which control shall remain solely vested in the General Partners; (iii) elect,appoint and remove such management officials to and from the positions socreated; and (iv) indemnify and hold harmless such management officials againstany loss, expense or damage suffered by reason that such Person was amanagement official of the Partnership. The appointment of such management officials shall not constitute suchmanagement officials as general partners of the Partnership and shall notaffect the rights, duties and obligations of the General Partners as generalpartners, or the Management Committee under this Agreement.  All Persons elected as management officialsof the Partnership shall report to the Management Committee which, on behalf ofthe General Partners, in all respects shall retain the ultimate managementauthority and control over the affairs of the Partnership.  All officials of the Partnership other thanthe management officials shall report to the management officials.

(b)           The management officials of thePartnership shall be a President, a Vice President and a Secretary.  The Management Committee in its discretionmay also choose a Chairman, additional Vice Presidents, one or more AssistantSecretaries, a Treasurer, one or more Assistant Treasurers and other managementofficials.  Any number of positions maybe held by the same Person, unless otherwise prohibited by law or thisAgreement.  The Management Committeeshall elect the management officials of the Partnership (other than thePresident who shall be appointed by TransCanada GP in its sole discretion) whoshall hold their positions for such terms and shall exercise such powers andperform such duties, as shall be determined from time to time by the ManagementCommittee; and all management officials of the Partnership shall hold suchposition until their successors are chosen and qualified, or until theirearlier resignation or removal.  Anymanagement official elected by the Management Committee may be removed at anytime by the Management Committee.  Anyvacancy occurring in any position of the Partnership shall be filled by theManagement Committee (or, in the case of the President, by TransCanadaGP).  The salaries of all managementofficials of the Partnership, if any, shall be fixed by the ManagementCommittee.  The responsibilities and dutiesof the management officials are as follows:

(i)            The President shall be the chiefexecutive officer of the Partnership and, subject to the Management Committee,on behalf of the General Partners, having full and complete control over thebusiness and affairs of the Partnership, each shall have general supervision ofthe business of the Partnership and shall see that all orders and resolutionsof the Management Committee are carried into

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effect.  The President may execute all bonds,mortgages, contracts and other instruments of the Partnership, except whererequired or permitted by law to be otherwise signed and executed and exceptthat the other management officials of the Partnership may sign and executedocuments when so authorized by the Management Committee.  The President shall also perform such otherduties and may exercise such other powers as from time to time may be assignedto him or her by the Management Committee.

(ii)           At the request of the President or inhis absence or in the event of his inability or refusal to act, the VicePresident so designated by the Management Committee shall perform the duties ofthe President, and when so acting, shall have all the powers of and be subjectto all the restrictions upon the President. Each Vice President shall perform such other duties and have such otherpowers as the Management Committee from time to time may prescribe.

(iii)          The Secretary shall attend allmeetings of the Partners of the Partnership and the Management Committee andrecord all the proceedings thereat in a book or books to be kept for thatpurpose; the Secretary shall also perform like duties for any standingcommittees when required.  The Secretaryshall give, or cause to be given, notice of all meetings of the Partners of thePartnership and shall perform such other duties as may be prescribed by theManagement Committee under whose supervision he shall be.  If the Secretary shall be unable or shallrefuse to cause to be given notice of all meetings of the Partners of thePartnership, and if there shall be no Assistant Secretary, then the ManagementCommittee may choose another management official to cause such notice to begiven.  The Secretary shall see that allbooks, reports, statements, certificates and other documents and recordsrequired by law to be kept or filed are properly kept or filed, as the case maybe.

(iv)          The Treasurer shall have the custodyof the Partnership funds and securities and shall keep full and accurateaccounts of receipts and disbursements in books belonging to the Partnershipand shall deposit all moneys and other valuable effects in the name and to thecredit of the Partnership in such depositories as may be designated by theManagement Committee.  The Treasurershall disburse the funds of the Partnership as may be ordered by the ManagementCommittee, taking proper vouchers for such disbursements, and shall render tothe President and the Management Committee an account of all his transactionsas Treasurer and of the financial condition of the Partnership.  If required by the Management Committee, theTreasurer shall give the Partnership a bond in such sum and with such surety orsureties as shall be satisfactory to the Management Committee for the faithfulperformance of the duties of his office and for the restoration to thePartnership, in case of his death, resignation, retirement or removal fromoffice, of all books, papers, vouchers, money and other property of whateverkind in his possession or under his control belonging to the Partnership.

(v)           Other Management Officials.Such other management officials as the Management Committee may choose shall performsuch duties and have such

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powers as from time totime may be assigned to them by the Management Committee.

6.4           Compensation and Reimbursement ofthe General Partners.  (a)   Exceptas provided in this Section 6.4 and elsewhere in this Agreement, no GeneralPartner shall be compensated for his or its services as General Partner to thePartnership.

(b)           Subject to approval by the ManagementCommittee, each General Partner shall be reimbursed for all expenses,disbursements and advances incurred or made in connection with thequalification of the Partnership and the General Partners to do business, andany issuance of Partnership Interests or other securities by the Partnership.

(c)           Subject to approval by the ManagementCommittee, each General Partner shall be reimbursed on a monthly basis, or suchother basis as the General Partners may determine in their sole discretion, forall direct expenses it incurs or makes on behalf of the Partnership (includingamounts paid to any Person to perform services to the Partnership). The GeneralPartners shall determine the expenses which are allocable to the Partnership inany reasonable manner. Such reimbursements shall be in addition to anyreimbursement to a General Partner as a result of indemnification pursuant toSection 6.7.

(d)           Any amount reimbursed to a GeneralPartner pursuant to Sections 6.4(b) or 6.4(c) which is disallowed by FERC shallbe reimbursed to the Partnership by such General Partner.

6.5           Outside Activity.  (a)  Neither of the GeneralPartners shall enter into or conduct any business except in connection with itsperformance of its duties and obligations as a General Partner under the termsof this Agreement.

(b)           Any Affiliate of a General Partnerand any equity holder, director, officer or employee of a General Partner mayhave business interests and engage in business activities in addition to thoserelating to the Partnership, including business interests and activities whichconflict with or are in direct competition with the Partnership for his or itsown account and for the account of others, and may own interests in the sameproperties as those in which the Partnership owns an interest, without havingor incurring any obligation to offer any interest in such properties,businesses or activities to the Partnership or any Partner, and, except asspecified in Section 6.5(a), no other provision of this Agreement shall bedeemed to prohibit any such Person from conducting such other businesses andother activities.  Neither thePartnership nor any of the Partners shall have any rights by virtue of thisAgreement or the partnership relationship created hereby in any businessventures of any such Person or any of the revenues, profits or losses derivedtherefrom.

6.6           Dealings with the General Partners.  (a)        AnyGeneral Partner or Affiliate thereof with the consent of the General Partnersmay lend to the Partnership funds needed by the Partnership for such periods oftime as the General Partners may determine; provided, however,that such General Partner or Affiliate may not charge the Partnership interestat a rate greater

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than the rate (including points or other financingcharges or fees) that would be charged the Partnership (without reference tothe General Partner’s financial abilities or guaranties) by unrelated lenderson comparable loans.  The Partnershipshall reimburse such General Partner or Affiliate for any costs incurred by himor it in connection with the borrowing of funds obtained by such GeneralPartner or Affiliate and loaned to the Partnership.

(b)           Either of the General Partners mayitself, or may enter into an agreement with an Affiliate to, render services tothe Partnership.  Any service rendered tothe Partnership by a General Partner or any such Affiliate shall be on termsthat are fair and reasonable to the Partnership.  Approval by the Management Committee of theterms of any such agreement shall constitute an acknowledgement that the termscontained in such agreement are fair and reasonable to the Partnership.  The General Partner, other than the GeneralPartner or the Affiliate thereof which is providing the services, shall havethe right to require the Partnership to conduct an audit of such services.  The provisions of Section 6.4 shall apply tothe rendering of services described in this Section 6.6(b).

(c)           Neither any General Partner nor anyAffiliate thereof shall sell, transfer or convey any property to, or purchaseany property from, the Partnership, directly or indirectly, except pursuant totransactions that are fair and reasonable to the Partnership.

6.7           Indemnification.  (a)   To the fullest extentpermitted by law, the Partnership shall indemnify any Person who was or is aparty, or is threatened to be made a party, to any threatened, pending orcompleted action, suit or proceeding, whether civil, criminal, administrativeor investigative and whether formal or informal, by reason of the fact that thePerson is or was a General Partner or an equity holder, director or officer ofa General Partner or management official of the Partnership, or is or wasserving at the request of a General Partner or the Partnership as an equityholder, director, officer, partner, trustee, employee or agent of anothercorporation, partnership, joint venture, trust or other enterprise (includingany employee benefit plan), against all expense, liability and loss (including attorneys’fees, judgments, fines, ERISA excise taxes or penalties and amounts paid insettlement) reasonably incurred or suffered by such Person in connection withsuch action, suit or proceeding, unless such Person failed to act in good faithand in a manner that such Person actually believed to be in or not opposed tothe best interests of the Partnership. This indemnification shall continue as to any Person who has ceased toserve in any or all of the foregoing capacities and shall inure to the benefitof the heirs, executors and administrators of any deceased Person.  The right to this indemnification shall bedeemed a contract right and shall include the right to be advanced currentlythe expenses incurred in connection with any such action, suit or proceeding.

(b)           If a claim under paragraph (a) ofthis Section is not paid in full by the Partnership within 60 days after awritten claim has been received by the Partnership, except in the case of aclaim for the advancement of expenses incurred in connection with any action,suit or proceeding in which case the applicable period shall be 20 days, theindemnitee may at any time thereafter bring suit against the Partnership torecover the unpaid amount of the claim. If successful in whole or in part in any suit or in a suit brought bythe Partnership to recover the advancement of expenses incurred in connectionwith any action, suit or proceeding, the indemnitee shall be entitled to bepaid also the expense of prosecuting or defending such a claim.  In any action brought by the

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indemnitee to enforce aright to indemnification hereunder or by the Partnership to recover theadvancement of expenses incurred in connection with any action, suit orproceeding, the Partnership shall have the burden of proving by clear andconvincing evidence that the indemnitee is not entitled to be indemnified underthis Section or otherwise.  No unilateraldetermination by the Partnership that the indemnitee has not met the standardof conduct set forth in paragraph (a) of this Section shall create apresumption that the indemnitee has not met that standard of conduct or, in thecase of an action brought by the indemnitee under this paragraph (b), be adefense to the action.

(c)           The right to indemnification and theadvancement of expenses conferred in this Section shall not be exclusive of anyother right that any Person may have or hereafter acquire under any statute,agreement or otherwise.

(d)           The Partnership may maintaininsurance, at its expense, to protect any Person against any expense, liabilityor loss, whether or not the Partnership would have the power to indemnify suchPerson against such expense, liability or loss under the Partnership Act.

(e)           The Partnership may, to the extentauthorized from time to time by the Management Committee, grant rights toindemnification and the advancement of expenses to any employee or agent of thePartnership lesser than or coextensive with the rights set forth above in thisSection.

(f)            In no event may an indemniteesubject the Limited Partners to personal liability by reason of theseindemnification provisions.

(g)           An indemnitee shall not be deniedindemnification in whole or in part under this Section 6.7 because theindemnitee had an interest in the transaction with respect to which the indemnificationapplies if the transaction was otherwise permitted by the terms of thisAgreement.

6.8           Liability.  (a)   Neither any GeneralPartner nor any equity holder, director or officer of a General Partner or anymanagement official of the Partnership (the “Management Group”) shall be liableto the Partnership, any General Partner, any Limited Partner for monetarydamages as a result of any loss, costs, damage or other injury suffered by suchPerson as a result of the act or omission of a member of the Management Group(including a breach of fiduciary duty or duty of care to any of the foregoing),unless the Partnership, a General Partner, Limited Partner satisfies his or itsburden of proof to show by clear and convincing evidence that the Person soughtto be held liable (i) breached a duty of loyalty to the Partnership, (ii) actedin bad faith or engaged in intentional misconduct or a knowing violation of lawor (iii) derived an improper personal benefit.

(b)           Each General Partner may exercise anyof the powers granted to him or it by this Agreement and perform any of theduties imposed upon him or it hereunder either directly or by or through itsagents, and such General Partner shall not be responsible for any misconduct ornegligence on the part of any such agent appointed by such General Partner ingood faith.

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(c)           Whenever in this Agreement anyGeneral Partner is permitted or required to make a decision (i) in his or its “solediscretion” or “discretion,” with “complete discretion” or under a grant ofsimilar authority or latitude, such General Partner shall be entitled toconsider only such interests and factors as he or it desires and shall have noduty or obligation to give any consideration to any interest of or factorsaffecting the Partnership, the Limited Partners, or (ii) in his or its “goodfaith” or under another express standard, such General Partner shall act undersuch express standard and shall not be subject to any other or differentstandards imposed by this Agreement or any other agreement contemplatedherein.  Each Limited Partner herebyagrees that any standard of care or duty imposed in this Agreement or any otheragreement contemplated herein or under the Partnership Act or any other applicablelaw, rule or regulation shall be modified, waived or limited in each case asrequired to permit each General Partner to act under this Agreement or anyother agreement contemplated herein and to make any decision pursuant to theauthority prescribed in this Section 6.8(c).

6.9           Other Matters Concerning theGeneral Partners.  (a)     Each General Partner may rely and shall beprotected in acting or refraining from acting upon any resolution, certificate,statement, instrument, opinion, report, notice, request, consent, order, bond,debenture, or other paper or document believed by him or it to be genuine andto have been signed or presented by the proper party or parties.

(b)           When any provision in this Agreementrequires any action by or approval or consent of the General Partners, each ofthe General Partners must agree to take such action or give or deny suchapproval or consent.

(c)           Each General Partner may consult withlegal counsel, accountants, appraisers, management consultants, investmentbankers, and other consultants and advisers selected by it, and any opinion ofsuch Person as to matters which such General Partner believes to be within suchPerson’s professional or expert competence shall be full and completeauthorization and protection in respect of any action taken or suffered oromitted by such General Partner hereunder in good faith and in accordance withsuch opinion.

6.10         Title to Partnership Assets.  All Partnership assets, whether real,personal or mixed, tangible or intangible, shall be owned by the Partnership asan entity, and no Partner, individually or collectively, shall have anyownership interest in such or all of the Partnership assets as may be held inthe name of the Partnership or one or more nominees, as the General Partnersmay determine.  Each General Partnerhereby declares and warrants that any Partnership assets for which legal titleis held in the name of a General Partner shall be held in trust by such GeneralPartner for the sole use and benefit of the Partnership in accordance with theterms and provisions of this Agreement. All the Partnership assets shall be recorded as the property of thePartnership on its books and records, irrespective of the name in which legaltitle to such Partnership assets is held.

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**ARTICLE VIILIMITATION OF LIABILITIES**

7.1           Limitation of Liability of LimitedPartners.  No Limited Partner shallbe liable for or subject to any obligations, losses, debts or liabilities ofthe Partnership at any time in excess of the sum of (a) the amount of suchLimited Partner’s Capital Account at such time, and (b) as specificallyrequired by the Partnership Act.

7.2           Limitation of Authority ofPartners.  Except as otherwiseprovided in the Operating Agreement, no Partner shall have the authority to actfor, or assume any obligation or responsibility on behalf of, any otherPartner, without the prior written approval of such other Partner.

7.3           Cross-Indemnification.  Each Partner (for purposes of this Section7.3, the “indemnitor”) shall indemnify and hold harmless each of the otherPartners (for purposes of this Section 7.3, the “indemnitee”) and theAffiliates, directors, officers, partners (other than the Partners to thisAgreement), employees, agents and representatives of the indemnitee from andagainst any costs, losses, claims, damages and liabilities arising out of anyact of the indemnitor or any of its Affiliates, directors, officers, partners(other than the Partners to this Agreement), employees, agents orrepresentatives which has the effect of binding the indemnitee, or which hasthe effect of making the indemnitee liable without its consent, or arising outof any assumption of any obligation or responsibility by the indemnitor or anyof its Affiliates, directors, officers, partners (other than the Partners tothis Agreement), employees, agents or representatives which has the effect ofbinding the indemnitee, or which has the effect of making the indemnitee liablewithout its consent (including, without limitation, sales or other actsentirely on its part which may give rise to product liability claims);provided, however, that this Section 7.3 shall have no application with respectto any actions taken (a) on behalf of the Partnership by, or on behalf of, theManagement Committee in conformance with this Agreement, (b) on behalf of onePartner by another Partner in conformance with this Agreement or (c) by, or onbehalf of, the Operator (as that term is defined in the Operating Agreement) inconformance with the Operating Agreement.

7.4           Limited Recourse.  Unless otherwise consented to by the ManagementCommittee, all agreements entered into by or on behalf of the Partnership,including any indenture, note or other evidence of indebtedness, shall providethat no personal liability whatsoever shall attach to, be imposed on orotherwise be incurred by any Partner, agent, management official or employee ofthe Partnership or any director, officer or employee of any of the foregoingfor any obligation of the Partnership under such agreement or for any claimbased on such obligation and that the sole recourse of other parties to suchagreements shall be limited to the assets of the Partnership.

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**ARTICLE VIIITRANSFER OR PLEDGE OF PARTNERSHIP INTERESTS**

8.1           Additional Definitions.  The following definitions shall apply forpurposes of this Article VIII:

Beneficial Owner.  Any “Beneficial Owner” within the meaning ofRule 13d-3 of the Exchange Act.

Change of ControlTransaction.  A changein the beneficial ownership of the equity interests of the subject Person or achange in management of the subject Person as follows:

(a)           any Exchange Act Person (other than(i) the subject Person, (ii) any entity owned, directly or indirectly, by theequityholders of the subject Person in substantially the same proportions astheir ownership of equity of the subject Person, and (iii) any trustee or otherfiduciary holding securities under an employee benefit plan of the subjectPerson or its Affiliates or such proportionately owned entity) becomes, throughacquisitions of securities of the subject Person after the date of thisAgreement, the Beneficial Owner, directly or indirectly, of securities of thesubject Person representing 50% or more of the then-outstanding equityinterests of the subject Person;

(b)           a merger or consolidation of thesubject Person with any other Person, other than (i) a merger or consolidationwhich would result in the equity interests of the subject Person outstandingimmediately prior thereto continuing to represent (either by remainingoutstanding or by being converted into equity interests of the survivingentity) more than 50% of the equity interests of the subject Person or suchsurviving entity outstanding immediately after such merger or consolidation, or(ii) a merger or consolidation effected to implement a recapitalization of thesubject Person (or similar transaction) in which no Person acquires more than15% of the then outstanding equity interests of the subject Person;

(c)           the consummation of a plan ofcomplete liquidation of the subject Person or the sale or disposition by thesubject Person of all or substantially all of the assets of the subject Person(or any transaction having a similar effect);

(d)           if the subject Person has a ManagingBoard, during any 24 month period, individuals who at the beginning of suchperiod constitute the Managing Board of the subject Person, and any new membersof the Managing Board (other than members of the Managing Board designated by aPerson who has entered into an agreement with the subject Person to effect atransaction described in paragraph (a), (b) or (c) above) whose election by theManaging Board or nomination for election by the equityholders of the subjectPerson was approved by a vote of at least two-thirds of the members of theManaging Board then still in office who either were members of the ManagingBoard at the beginning of the period or whose election or nomination forelection was previously so approved, cease for any reason to constitute atleast a majority thereof; or

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(e)           if the subject Person does not have aManaging Board, a change in the Person or group of Persons, or any combinationthereof, which controls directly or indirectly the subject Person unless (i)such Person or Persons acquiring control are Affiliates of the Persons or groupof persons giving up control or (ii) such Person or Persons giving up controlare widely held and publicly-traded.

Exchange Act.  The Securities Exchange Act of 1934, asamended.

Exchange Act Person.  Any “Person” within the meaning of Sections3(a)(9), 13(d) and 14(d)(2) of the Exchange Act.

Managing Board.  The board of directors or similar managementboard or committee, if any, of the subject Person.

8.2           Transfer.  (a)   From and after the datehereof, no Partner shall, and each Partner shall cause each of their respectiveAffiliates not to:

(i)            directly sell, assign, transfer,give, hypothecate, pledge, encumber or otherwise dispose of, whethervoluntarily or by operation of law or otherwise (a “Direct Transfer”); or

(ii)           effect or be subject to a Change ofControl Transaction that results in an indirect sale, assignment, transfer,gift, hypothecation, pledge, encumbrance or otherwise disposition of, whethervoluntarily or by operation of law or otherwise,

all or any portion of thePartnership Interests of such Partner (the transactions described in theforegoing clauses (i) and (ii)  beingcollectively referred to herein as a “Transfer”) without the prior consent ofthe Management Committee (“Management Committee Consent”), and any Transfer orattempt to effect a Transfer without such consent shall be void; provided thatnotwithstanding the foregoing, Management Committee Consent shall not berequired in connection with a Transfer (A) effected in accordance with theprovisions of Sections 8.2(b) or 8.3, or (B) resulting from a Change in ControlTransaction involving (x) in the case of Great Lakes or TransCanada GP,TransCanada Corporation (or any successor thereto), (y) in the case of TCGL GP,TC PipeLines, LP (or any successor thereto), and (z) in the case of any otherPartner, the then-existing ultimate Parent entity of such Partner.

(b)           A Partner or any of its respectiveAffiliates may, without receiving Management Committee Consent and withoutcomplying with Section 8.3 (if applicable) but subject to compliance withSections 8.4 and 8.5 (if applicable), at any time effect a Transfer of itsPartnership Interest to any Affiliate (which for such purposes means, inrespect of any Person, an Affiliate which, directly or indirectly, ownscompletely, or is owned completely, or shares common ownership completely inrespect of such Person).  Any Partner whoeffects a Direct Transfer of a Partnership Interest in accordance with thisSection 8.2(b) shall, upon the consummation of such Direct Transfer, cease tohave any further rights or obligations with respect to such PartnershipInterest.

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8.3           Right of First Refusal.  (a)   Inthe event a Partner (the “Transferring Partner”) accepts a *bona fide*offer to effect a Direct Transfer of all of its Partnership Interest (the “SubjectInterest”) to a Person (the “Offeror”) in exchange for cash by entering into awritten agreement with the Offeror with respect to such offer (the “Third PartyAgreement”), then, prior to consummating the transactions contemplated by theThird Party Agreement, the Transferring Partner shall give written noticethereof (the “Disposition Notice”) to the other Partners enclosing a true andcomplete copy of the Third Party Agreement, which Third Party Agreement (i)must contain all of the terms and conditions of the proposed transactionbetween the Transferring Partner and the Offeror (the “Proposed Transaction”),and (ii) cannot provide for the Transfer of, or otherwise address or take intoaccount, any assets or liabilities of the Transferring Partner or any of itsAffiliates other than the Subject Interest.

(b)           The Partners other than theTransferring Partner shall have a right of first refusal, exercisable for aperiod beginning on the date of the delivery of the Disposition Notice andending on the 90th day after delivery of the Disposition Notice(the “Exercise Period”), to purchase the Subject Interest on the terms setforth in the Third Party Agreement (with only those changes as are necessary toreflect that the applicable Partner, as opposed to the Offeror, is the buyer ofthe Subject Interests), on a *pro rata* basis(determined by dividing each such non-Transferring Partner’s PercentageInterest by the sum of the Percentage Interests of all the Partners other thanthe Transferring Partner).

(c)           If more than one Partner elects topurchase any portion of the Subject Interest, such Partners may allocate thepurchase of the Subject Interest among themselves on a basis unanimously agreedto by such Partners, provided that such Partners collectively agree to purchase100% of the Subject Interest and failing agreement shall purchase their *pro rata* share of the Subject Interest.

(d)           If no Partner makes a timely electionto exercise its right of first refusal in accordance with this Section 8.3, theTransferring Partner shall thereafter be free to complete the SubjectTransaction with the Offeror on the terms set forth in the Third PartyAgreement.  If the Transferring Partnerdoes not complete the Subject Transaction within 90 days after the expirationof the Exercise Period, the Transferring Partner shall be prohibited fromcompleting with Proposed Transaction without again complying with the terms ofthis Section 8.3.

8.4           Mechanics of Transfer.  (a)    Any Person (otherthan a Partner) who is the transferee of Partnership Interests pursuant to aDirect Transfer in compliance with the terms and conditions of this ArticleVIII shall, in order to validly effect the Direct Transfer in accordance withthis Article VIII, agree in writing to be bound by this Agreement (as modifiedto reflect any changes that, in the determination of the Management Committee,may be necessary or reasonably appropriate to give effect to such DirectTransfer and the addition of such Person as a Partner)****and,in doing so, shall be deemed to have: (i) agreed to comply with and be bound byand to have executed this Agreement, (ii) represented and warranted that suchtransferee has authority to enter into this Agreement, (iii) appointed eachGeneral Partner attorney-in-fact to execute any document that either of themmay deem necessary or appropriate to be executed in connection with suchtransfer, and (iv) made the consents and waivers contained herein.

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(b)           Each distribution in respect ofPartnership Interests shall be paid by the Partnership, directly or through itsagent, only to the Partner of record. Such payment shall constitute full payment and satisfaction of thePartnership’s liability in respect of such payment, regardless of any claim ofany Person who may have an interest in such payment by reason of an assignmentor otherwise.

8.5           Further Restrictions on Transfer.  In addition to the other limitations onTransfers set forth in this Article VIII and elsewhere in this Agreement to thecontrary, no Partner shall, and each Partner shall cause their respectiveAffiliates not to, effect a Transfer of any Partnership Interest if suchTransfer would (a) violate the then applicable Federal and state securitieslaws or rules and regulations of the Securities and Exchange Commission, anystate securities commission or any other governmental authorities withjurisdiction over such transfer, (b) result in the Partnership being treated asa corporation for Federal income tax purposes (including Section 7704 of theCode) or being terminated under Section 708(b) of the Code, unless in the caseof a termination under Section 708(b) of the Code, such termination would nothave a material adverse effect on any non-transferring Partner’s present orfuture allocable share of Partnership taxable income or loss with respect toits Partnership Interest (also taking into account any recapture of credits) ascompared to its present or future allocable share of Partnership taxable incomeor loss if there had not been such a termination, or (c) affect the Partnership’sexistence or qualification as a limited partnership under the Partnership Act.

**ARTICLE IXADMISSION OF PARTNERS**

9.1           Admission of Additional LimitedPartners.  A Person (other than GreatLakes) who makes a Capital Contribution to the Partnership shall be admitted tothe Partnership as an Additional Limited Partner upon furnishing to theManagement Committee (a) acceptance, in form satisfactory to the ManagementCommittee, of all the terms and conditions of the Agreement and (b) such otherdocuments or instruments as may be required in order to effect his admission asa Limited Partner, and such admission shall become effective on the date thatthe Management Committee determines in its sole discretion that such conditionshave been satisfied and when any such admission is shown on the books andrecords of the Partnership.

9.2           Admission of Additional GeneralPartners.  The General Partners mayadmit to the Partnership one or more additional General Partners at any timeand from time to time and shall establish the rights, powers and privileges ofsuch additional General Partners.

9.3           Admission of Successor GeneralPartners.  A successor GeneralPartner selected pursuant to Section 10.1 shall be admitted to the Partnershipas a General Partner, effective immediately prior to the withdrawal of a GeneralPartner pursuant to Section 10.1.

9.4           Amendment of Agreement and ofCertificate of Limited Partnership. For the admission to the Partnership of any additional or successorGeneral Partner (including in respect of a transfer of a General Partner Interestin accordance with Article VIII), the General Partners shall take all stepsnecessary and appropriate to prepare and file as soon as practical an amendmentof this Agreement and, if required by law, the Certificate of LimitedPartnership.

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**ARTICLE XWITHDRAWAL AND REMOVAL OF PARTNERS**

10.1         Withdrawal of General Partners.  Each General Partner covenants and agreesthat, without the consent of the other General Partners, it will not withdrawas a General Partner.  The foregoingnotwithstanding, a Person will cease to be a General Partner and will be deemedto have withdrawn as a General Partner upon the occurrence of an Event ofWithdrawal.  Upon the withdrawal by aGeneral Partner upon the occurrence of an Event of Withdrawal or otherwise inviolation of this Agreement, the Partnership shall terminate and dissolveunless the remaining General Partners agree to continue the Partnership.  If the remaining General Partners so agree,the Partnership shall be continued, without dissolution, the withdrawing generalpartner shall not be entitled to receive any distribution from the Partnershipexcept as otherwise provided in Article XI, the Partnership Interests of thewithdrawing General Partner shall immediately be converted into that of aLimited Partner, and all rights, powers and privileges of the withdrawingGeneral Partner under this Agreement shall be vested in the remaining GeneralPartners.  Prior to the effective date ofsuch a withdrawal, if any, the remaining General Partners may select asuccessor General Partner to the withdrawing General Partner with such rights,powers and privileges as designated by the remaining General Partner.  If a successor General Partner is selected,it shall be admitted immediately prior to the withdrawal of the withdrawingGeneral Partner.  Upon withdrawal of thelast remaining General Partner, the Partnership shall be dissolved pursuant toSection 11.1.

10.2         Removal of General Partners.  A General Partner may not be removed by theother General Partners or the Limited Partners.

10.3         Withdrawal of Limited Partners.  No Limited Partner shall have any right towithdraw from the Partnership; provided, however, that upon apermitted transfer of a Limited Partnership Interest, such Limited Partnershall cease to be a Limited Partner with respect to the Partnership Interest sotransferred.  No Limited Partner shall beentitled to the return of its Capital Contribution, except to the extent, ifany, that distributions made pursuant to this Agreement or upon termination ofthe Partnership may be considered as such by law and then only to the extentprovided for in this Agreement.

10.4         Liability of Withdrawing Partner.  A Partner who has withdrawn from thePartnership shall remain liable for all of its obligations or liabilities as ofthe date of withdrawal whether known or unknown or fixed or contingent at thattime.

**ARTICLE XIDISSOLUTION AND LIQUIDATION**

11.1         Dissolution.  Except as otherwise provided below, thePartnership shall not be dissolved by the admission of Additional LimitedPartners or Substituted Limited Partners, by the admission of additionalGeneral Partners or successor General Partners or by the removal of a GeneralPartner in accordance with the terms of this Agreement.  The Partnership shall dissolve, and its affairsshall be wound up, upon:

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(a)           the expiration of its term asprovided in Section 1.6;

(b)           the withdrawal with respect to thelast remaining General Partner or the withdrawal of a General Partner asprovided in Section 10.1, unless the remaining General Partners agree tocontinue the Partnership, provided that the Partnership shall not be dissolvedand shall not be required to be wound up by reason of such withdrawal if,within 90 days after the withdrawal all remaining Partners agree in writing tocontinue the business of the Partnership; or

(c)           an election to dissolve thePartnership by the General Partners.

11.2         Winding Up and Liquidation.  Upon the dissolution of the Partnership, theManagement Committee shall continue to exercise its powers under this Agreementfor the purpose of winding up the business of tie Partnership and liquidatingits assets in an orderly manner, but the Partnership shall engage in no newbusiness during the period of such winding up.

(a)           The assets of the Partnershipremaining after the payment, or provision for payment, of all the liabilitiesof the Partnership shall be distributed to the Partners in accordance with thepositive balances in their respective Capital Accounts, after taking alladjustments to Capital Accounts for all periods, provided, however, that if theCapital Accounts of the Partners, as adjusted for all periods, are not in theratio of the Percentage Interests of the Partners, then first to such Partnersto cause the Capital Accounts to be in such Percentage Interests.

(b)           No termination or dissolution of thePartnership shall relieve a Partner from any obligation accruing or accrued tothe date of such termination or dissolution.

11.3         Cancellation of Certificate ofLimited Partnership.  Upon thecompletion of the distribution Partnership property as provided in Section11.2, the Partnership shall be terminated, and the Management Committee (or theGeneral Partners and Limited Partners if necessary) shall cause thecancellation of the Certificate of Limited Partnership and all qualificationsof the Partnership as a foreign limited partnership in jurisdictions other thanthe State of Delaware and shall take such other actions as may be necessary toterminate the Partnership.

11.4         Return of Capital.  Upon dissolution of the Partnership, theGeneral Partners shall contribute to the Partnership an amount equal to thelesser of: (i) any deficit balances in their Capital Accounts; or (ii) theexcess of 1.01% of the sum of the cash amount and Net Agreed Value of all CapitalContributions of the Limited Partners as limited partners of the Partnershipover the sum of the cash amount and the Net Agreed Value of all CapitalContributions previously contributed by the General Partners as generalpartners of the Partnership.  Other thanas provided in the preceding sentence, no General Partner shall be personallyliable for the return of the Capital Contributions of the Limited Partners, orany portion thereof, it being expressly understood that (x) any such returnshall be made solely from Partnership assets and (y) neither a deficit in aPartner’s Capital Account, nor the General Partners’ obligation to contributeamounts to the Partnership pursuant to this Section 11.4, shall constitute aPartnership asset.

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11.5         Waiver of Partition.  Each Partner hereby waives any right topartition of the Partnership property.

11.6         Continuance of Partnership.  If, notwithstanding Section 11.1 of thisAgreement, the Partnership is at any time deemed by operation of law and otherthan pursuant to Section 10.1 or 10.2 to be dissolved, each of the Partnershereby covenants and agrees with the other Partners as follows:

(a)           The business and affairs of thePartnership shall continue without interruption and be carried out by a newlimited partnership (the “Successor Partnership”);

(b)           The General Partners and LimitedPartner(s) of the Successor Partnership shall be the Persons who were GeneralPartners and Limited Partner(s) respectively, hereunder at the time of suchdissolution;

(c)           The Successor Partnership and thePartners thereof shall be governed by the terms of this Agreement as if theSuccessor Partnership were the Partnership;

(d)           Each of the Partners covenants andagrees to execute such further agreements, including (without limitation) notes,novations and accommodations, as may be necessary to continue the business ofthe Partnership and to protect and perfect any lien or security interestgranted by the Partnership;

(e)           Each of the Partners waives andreleases, to the full extent it may lawfully do so, all rights to a winding upor liquidation of the business of the Partnership, notwithstanding that thedissolution of the Partnership may be caused wrongfully or otherwise incontravention of this Agreement by such Partner or any other Partner, andfurther notwithstanding that, at the time of such dissolution, such Partnershall be, or be deemed to be or thereby become, a withdrawing Partner pursuantto this Agreement; and

(f)            As used in this Section 11.6, theterm “Partnership,” at any point in time, shall mean the Partnership originallyformed pursuant to this Agreement or the Successor Partnership which at suchtime is continuing the business and affairs of the Partnership originally soformed.

11.7         Termination Subject to Natural GasAct.  The right and power toterminate the Partnership shall at all times be subject to the obligations andduties of the Partnership as a “natural gas company” under the Natural Gas Actor any successor or parallel statutes and the jurisdiction of the FERC thereunder,and no termination shall be effected unless all provisions of such Act shallhave been complied with and any transfer of the Partnership’s business andassets, including all certificates of public convenience and necessity issuedunder such Act, shall have been validly consummated or abandoned under theprovisions of such Act and other applicable law.

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**ARTICLE XIIAMENDMENT OF PARTNERSHIP AGREEMENT;MEETINGS; RECORD DATE**

12.1         Amendments to be Adopted Solely bythe General Partners.  The GeneralPartners through the Management Committee, without the consent of any Partner,may amend any provision of this Agreement, and execute, swear to, acknowledge,deliver, file and record whatever documents may be required in connectiontherewith, to reflect or effectuate:

(a)           a change in the name of thePartnership; the location of the principal place of business of thePartnership; the registered office of the Partnership in the State of Delawareor the registered agent for service of process on the Partnership in the Stateof Delaware;

(b)           the continuance of the Partnership inaccordance with the provisions of this Agreement;

(c)           any necessary or appropriate changesto satisfy any requirements or conditions of applicable law;

(d)           any changes required, contemplated orexpressly permitted by this Agreement;

(e)           the admission, substitution, removalor withdrawal of Partners in accordance with this Agreement;

(f)            the cure of any ambiguity, or thecorrection or supplementation of any provision of this agreement which may beinconsistent with any other provision herein, or the correction of anystenographic or clerical errors or omissions in order that this Agreement shallaccurately reflect the agreement among the Partners;

(g)           a change that the General Partners intheir sole discretion have determined to be reasonable and necessary orappropriate to qualify or continue the qualification of the Partnership as alimited partnership or a partnership in which the Limited Partners have limitedliability under the laws of any state or that is necessary or advisable in theopinion of the General Partners to ensure that the Partnership will not betreated as an association taxable as a corporation for Federal income taxpurposes;

(h)           a change (i) that in the solediscretion of the General Partners does not adversely affect the other Partnersin any material respect, (ii) that is necessary or desirable to satisfy anyrequirements, conditions or guidelines contained in any opinion, directive,order, ruling or regulation of any Federal or state agency or judicialauthority or contained in any Federal or state statute or that is necessary ordesirable to facilitate the registration of any of the securities of thePartnership under the Securities Act of 1933, or comply with any rule, regulation,guideline or requirement of any securities exchange on which such securitiesare or will be listed for trading, compliance with any of which the

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General Partners deem tobe in the best interests of the Partnership and the other Partners, or (iii)that is required or contemplated by this Agreement;

(i)            an amendment that is necessary, inthe opinion of counsel to the Partnership, to prevent the Partnership, anyGeneral Partner or any equity holder, director, officer or employee of aGeneral Partner from in any manner being subjected to the provisions of theInvestment Company Act of 1940, as amended, the Investment Advisers Act of1940, as amended, or “plan asset” regulations adopted under the EmployeeRetirement Income Security Act of 1974, as amended, whether or notsubstantially similar to plan asset regulations currently applied or proposedby the United States Department of Labor;

(j)            an amendment that in the solediscretion of the General Partners is necessary or desirable in connection withadditional Capital Contributions made by the General Partners or the issuanceof any class or series of Partnership Interests pursuant to Section 3.2;

(k)           any amendment described in Section9.5; or

(l)            any other amendments similar to theforegoing.

Any Person (including thePartnership or any Partner) seeking legal or equitable relief concerning anysuch amendment by the General Partners shall have the burden of proving byclear and convincing evidence that the amendment falls outside the scope of theforegoing provisions of this Section 12.1.

12.2         Amendment Procedures.  Except as provided in Section 9.5, allamendments to this Agreement shall be made in accordance with the followingrequirements.  Amendments of thisAgreement may be proposed only by the General Partners.  If an amendment is proposed, the GeneralPartners shall seek the written consent of a Majority Interest or call ameeting of the Limited Partners to consider and vote on the proposed amendment.  A proposed amendment shall be effective uponits approval by a Majority Interest.  TheGeneral Partners shall notify all Partners upon final adoption of any proposedamendment.

**ARTICLE XIIIDISPUTE RESOLUTION**

13.1         Agreement to Arbitrate.  In the event that any dispute, difference orquestion arises between any Partners as to the meaning or interpretation of anyprovision of this Agreement or as to the performance of a Partner of itsobligations hereunder, whether before or after the termination of thisAgreement, and upon which such Partners cannot agree, then every such dispute,difference or question shall be referred to arbitration in accordance with theprovisions of Section 13.2.  No actionmay be brought by any Partner with respect to any such matter but the sameshall be determined only by arbitration.

13.2         Procedure.  If any Partner wishes to submit a dispute,difference or question to arbitration as provided in Section 13.2, it shall doso by giving notice of arbitration to the other

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Partners, setting out in such notice the dispute,difference or question to be determined by arbitration.  Upon receipt of such notice by the otherPartners, the Partners party to the dispute (the “Disputing Partners”) shallproceed to appoint a single arbitrator (the “Arbitrator”).  If the Disputing Partners do not agree on theappointment of a single arbitrator within 20 days after the receipt of noticeof arbitration by the Disputing Partner(s) to whom such notice is given, orwithin such greater period as the Disputing Partners may agree in writing, anyDisputing Partner may appoint an arbitrator and give notice to the otherDisputing Partner(s) of the appointment of such arbitrator.  The Disputing Partner receiving such noticewithin 20 days thereafter shall appoint a second arbitrator; if such partyfails to name a second arbitrator within the said period of 20 days, a secondarbitrator may be appointed by the first Disputing Partner.  The two arbitrators so appointed shallappoint a third arbitrator.  If the twoarbitrators are unable to agree as to the third arbitrator, any of theDisputing Partners may request the Chief Justice of the Ontario Court ofJustice, General Division or the Senior Federal District Judge of the UnitedStates District Court, Eastern District of Michigan, to appoint a thirdarbitrator and the person so appointed by the Chief Justice of the OntarioCourt of Justice, General Division or by the Senior Federal District Judge ofthe United States District Court, Eastern District of Michigan, shall be thethird arbitrator (in such case, such panel of three arbitrators shall be the “Arbitrator”).  The decision of the Arbitrator shall be finaland binding, and the Partners agree that judgment on the Arbitrator’s award maybe entered by any circuit court of the State of Michigan or by any other courtof competent jurisdiction.  Except asotherwise provided herein or required by law, the arbitration shall beconducted under the rules of the American Arbitration Association.

**ARTICLE XIVGENERAL PROVISIONS**

14.1         Notices.  Notice to all Partners shall be deemed to benotice to the Partnership.  If anyPartner receives a notice to or on behalf of the Partnership, such Partnershall immediately transmit such notice to all Partners.  Any notice or other communication required orpermitted under this Agreement shall be in writing and shall be deemed to havebeen duly given upon hand delivery or on the first business day followingdelivery to a nationally recognized United States or Canadian overnight courierservice, fee prepaid, return receipt or other confirmation of deliveryrequested, or on the third business day following delivery to the United Statesor Canadian Postal Service as certified or registered mail return receiptrequested, postage prepaid, if addressed to the Partnership and each Partner atthe addresses set forth below, or when telecopied or sent by facsimiletransmission to the numbers designated in writing by each Partner to befollowed within three (3) business days by delivery of written copy of suchcommunication:

(a)           To each of the Partners at theaddress as shown in the records of the Partnership or at such other address asmay be designated from time to time by any Partner by written notice to eachother Partner and the Partnership; and

(b)           To the Partnership at its principaloffice or such other address as may be designated from time to time by writtennotice to each of the Partners.  AnyPartner may request that copies of notices be given to any Affiliate at suchaddress designated by such Partner by written notice to each other Partner andto the Partnership, provided that any

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failure to give suchnotice shall not affect the validity of any notice given to any Partner or thePartnership in accordance with this Section 14.1.  Each of the Partners agrees to give suchnotice to any such Affiliate.

14.2         Further Assurances.  Each of the Partners agrees to execute anddeliver all such other and additional instruments and documents and to do suchother acts and things as may be reasonably necessary more fully to effectuatethis Partnership and carry on the Partnership business in accordance with thisAgreement.

14.3         Applicable Law.  This Agreement shall be governed by andinterpreted in accordance with the laws of the State of Delaware without regardto the principles of conflicts of laws. In the event that any provision of this Agreement shall be deemed toconflict with any provision of the Partnership Act, the provisions of thePartnership Act shall, to the extent required by the Partnership Act, becontrolling.

14.4         Counterparts.  This Agreement may be executed incounterparts (including counterparts provided for the execution by anAdditional Partner), each of which shall be deemed an original, but all ofwhich together shall constitute one and the same instrument.

14.5         Headings.  The headings contained in this Agreement arefor reference purposes only and shall not affect the meaning or interpretationof this Agreement.

14.6         Waiver.  No waiver by any Person of any default by anyPartner or Partners in the performance of any provision, condition orrequirement herein shall be deemed to be a waiver of, or in any manner releasethe said Partner or Partners from performance of any other provision, conditionor requirement herein; nor shall such waiver be deemed to be a waiver of, or inany manner a release of, said Partner or Partners from future performance ofthe same provision, condition or requirement. Any delay or omission of any Partner to exercise any right hereundershall not impair the exercise of any such right, or any like right, accruing toit thereafter.  No waiver of a rightcreated by this Agreement by one or more Partners shall constitute a waiver ofsuch right by the other Partners except as may otherwise be required by lawwith respect to Persons not parties hereto. The failure of one or more Partners to perform its or their obligationshereunder shall not release the other Partners from the performance of suchobligations.

14.7         Laws and Regulatory Bodies.  This Agreement and the obligations of thePartners hereunder are subject to all applicable laws, rules, orders andregulations of governmental authorities having jurisdiction and, in the eventof conflict, such laws, rules, orders and regulations of governmentalauthorities having jurisdiction shall control.

14.8         Section Numbers.  Unless otherwise indicated, references tosection numbers are to sections of this Agreement.

14.9         References to Money.  All references in this Agreement to, andtransactions hereunder in, money shall be to or in Dollars of the United Statesof America.

14.10       Severability.  Should any provision of this Agreement bedeemed in contradiction with the laws of any jurisdiction in which it is to beperformed or unenforceable for any reason, such provision shall be deemed nulland void, but this Agreement shall remain in force in all

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other respects. Should any provision of this Agreement be or become ineffective becauseof changes in applicable laws or interpretations thereof, should this Agreementfail to include a provision that is required as a matter of law, the validityof the other provisions of this Agreement shall not be affected thereby.  If such circumstances arise, the partieshereto shall negotiate in good faith appropriate modifications to thisAgreement to reflect those changes that are required by law.

14.11       Third Persons.  Except as expressly provided in thisAgreement, nothing herein expressed or implied is intended or shall beconstrued to confer upon or to give any Person not a party hereto any rights orremedies under or by reason of this Agreement.

14.12       Binding Effect.  This Agreement shall be binding upon andinure to the benefit of the parties hereto and their heirs, executors,administrators, successors, legal representatives and permitted assigns.

14.13       Integration.  This Agreement constitutes the entireagreement among the parties hereto pertaining to the subject matter hereof andsupersedes all prior agreements and understandings pertaining thereto.

14.14       Survival.  All indemnities and reimbursement obligationsmade pursuant to this Agreement shall survive dissolution and liquidation ofthe Partnership until expiration of the longest applicable statute oflimitations (including extensions and waivers) with respect to the matter forwhich a party would be entitled to be indemnified or reimbursed, as the casemay be.

*        *       *

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IN WITNESS WHEREOF, the Partners have caused thisAgreement to be executed by their respective duly authorized officers as ofFebruary 22, 2007.
|        | TRANSCANADA GL, INC.                                                                   |                    |
|--------|----------------------------------------------------------------------------------------|-------------------------|
|   |                                                                                   |                    |
|   |                                                                                   |                    |
|   | By:                                                                                    | /s/ Ronald L. Cook      |   |
|   |                                                                                   |                    |
|   | By:                                                                                    | /s/ Donald J. DeGrandis |   |
|   |                                                                                   |                    |
|   | TC GL INTERMEDIATE LIMITED  PARTNERSHIP, by its general partner, TC  PIPELINES GP INC. |                    |
|   |                                                                                   |                    |
|   |                                                                                   |                    |
|   | By:                                                                                    | /s/ Ronald L. Cook      |   |
|   |                                                                                   |                    |
|   | By:                                                                                    | /s/ Donald J. DeGrandis |   |
|   |                                                                                   |                    |
|   |                                                                                   |                    |
|   | GREAT LAKES GAS TRANSMISSION  COMPANY                                                  |                    |
|   |                                                                                   |                    |
|   |                                                                                   |                    |
|   | By:                                                                                    | /s/ Lee G. Hobbs        |   |
|   |                                                                                   |                    |
|   | By:                                                                                    |                    |   |

 

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**EXHIBIT A**

**PERCENTAGE INTERESTS**
| **Partner**                             | ** ** | **Percentage Interest** | ** ** |
|-----------------------------------------|------------|------------------------------|------------|
|                                    |       |                         |       |
| TransCanada GL, Inc.                    |       | 46.45                        | %          |
|                                    |       |                         |       |
| TC GL Intermediate  Limited Partnership |       | 46.45                        | %          |
|                                    |       |                         |       |
| Great Lakes Gas Transmission Company    |       | 7.10                         | %          |

 

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