**Exhibit 2.1****PARTNERSHIP INTERESTS PURCHASE AND CONTRIBUTION AGREEMENT****BY AND AMONG****LASER MIDSTREAM ENERGY II, LP,****LASER GAS COMPANY I, LLC,****LASER MIDSTREAM COMPANY, LLC****LASER MIDSTREAM ENERGY, LP****AND****EAGLE ROCK ENERGY PARTNERS, L.P.****DATED AS OF MARCH 30, 2007**
 

 
     ARTICLE I DEFINITIONS AND RULES OF CONSTRUCTION  2 1.1 Definitions  2 1.2 Rules of Construction  14      ARTICLE II PURCHASE, SALE & CONTRIBUTION; CLOSING  16 2.1 Purchase, Sale and Contribution of Interests  16 2.2 Consideration at Closing  16 2.3 Post-Closing Adjustment for Final Net Working Capital and Qualified Indebtedness  19 2.4 The Closing  21      ARTICLE III REPRESENTATIONS AND WARRANTIES RELATING TO THE SELLERS  22 3.1 Organization of Certain Sellers  22 3.2 Authorization; Enforceability  22 3.3 No Conflict; Consents  22 3.4 Ownership of Interests  23 3.5 Litigation  23 3.6 Disclosure  23 3.7 Solvency  24 3.8 Securities Representations  24      ARTICLE IV REPRESENTATIONS AND WARRANTIES RELATED TO THE COMPANIES  26 4.1 Organization  26 4.2 No Conflict; Consents  26 4.3 Capitalization  27 4.4 Litigation  27 4.5 Financial Statements; Internal Controls; Undisclosed Liabilities  28 4.6 Taxes  29 4.7 No Undisclosed Liabilities  30 4.8 Absence of Certain Changes  30 4.9 Contracts  30 4.10 Intellectual Property  31 4 .11 Employee Benefit Plans  32 4.12 Environmental Matters  37 4.13 Compliance with Laws; Permits  37 
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     4.14 Insurance  38 4.15 Labor Relations; Employment Matters  38 4.16 Books and Records  40 4.17 Title to Properties and Related Matters  40 4.18 Brokers’ Fees  41 4.19 Company Guaranties  41 4.20 No “Take or Pay”  41 4.21 Pipeline Easements  42 4.22 Pipeline Matters  42 4.23 Insider Interests  42 4.24 FCC Licenses  43 4.25 Receivables  43 4.26 Bank Accounts and Powers of Attorney  43 4.27 Investments  44 4.28 Illegal Payments  44 4.29 Offerings of Securities  44      ARTICLE V REPRESENTATIONS AND WARRANTIES RELATING TO BUYER  45 5.1 Organization  45 5.2 Authorization; Enforceability  45 5.3 Capitalization  45 5.4 No Conflict; Consents  45 5.5 Litigation  46 5.6 Brokers’ Fees  46 5.7 Financial Ability  46 5.8 Independent Investigation  46 5.9 SEC Filings  47 5.10 Tax Status  47      ARTICLE VI COVENANTS  48 6.1 Conduct of Business  48 6.2 Access  49 6.3 Third Party Approvals  50 6.4 Regulatory Filings  50 6.5 Employee and Benefit Matters  51 6.6 Books and Records  53 
 

 
     6.7 Permits  54 6.8 Acquisition Proposals  54 6.9 Noncompetition and Nonsolicitation  54 6.10 Owner Marks  57 6.11 Financial Statements  58 6.12 Representation Letters  58 6.13 NASDAQ Listing Agreement  58      ARTICLE VII TAX MATTERS  59 7.1 Character and Treatment of Transaction  59 7.2 Pre-Closing Restructuring  61 7.3 Post-Closing Tax Covenants  62 7.4 Responsibility for Filing Tax Returns and Paying Taxes  62 7.5 Responsibility for Tax Audits and Contests  63 7.6 Tax Refunds  63 7.7 Transfer Taxes  63 7.8 Disputes over Tax Provisions  63 7.9 No Limit on Indemnity  64      ARTICLE VIII CONDITIONS TO closing  65 8.1 Conditions to Obligations of Buyer  65 8.2 Conditions to the Obligations of the Sellers  67      ARTICLE IX INDEMNIFICATION  70 9.1 Survival  70 9.2 Indemnification  70 9.3 Limitations on Liability  71 9.4 Procedures  72 9.5 Arbitration  75 9.6 Escrow Account  75 9.7 Waiver of Consequential Damages  76 9.8 Waiver of Other Representations  77 9.9 Exclusive Remedy and Release  77      ARTICLE X TERMINATION  78 10.1 Termination  78 10.2 Effect of Termination  79 
 

 
     ARTICLE XI MISCELLANEOUS  80 11.1 Notices  80 11.2 Assignment  81 11.3 Rights of Third Parties  81 11.4 Expenses  81 11.5 Counterparts  81 11.6 Entire Agreement  81 11.7 Disclosure Schedules  82 11.8 Amendments  82 11.9 Publicity  82 11.10 Severability  82 11.11 Governing Law; Jurisdiction  83 **LIST OF EXHIBITS**   Exhibit A Related Assets   Exhibit B Escrow Agreement   Exhibit C Cap Ex Budget   Exhibit D Legal Opinion of Seller’s Counsel   Exhibit E Transition Agreement   Exhibit F Legal Opinion of Buyer’s Counsel
 

 
**PARTNERSHIP INTEREST PURCHASE AND CONTRIBUTION AGREEMENT**     THIS PARTNERSHIP INTEREST PURCHASE AND CONTRIBUTION AGREEMENT (this “***Agreement***”), dated as ofMarch 30, 2007, is entered into by and among (i) Laser Midstream Energy, II, LP, a Delawarelimited partnership (“***Laser Midstream II***”); (ii) Laser Gas Company I, LLC, a Delaware limitedliability company (“***Laser Gas***”); (iii) Laser Midstream Company, LLC, a Texas limited liabilitycompany (“***Laser GP,***” who along with Laser Midstream II and Laser Gas are each a “***Seller***” andcollectively, the “***Sellers***”); (iv) Laser Midstream Energy, LP, a Delaware limited partnership(“Laser Midstream”); and (v) Eagle Rock Energy Partners, L.P., a Delaware limited partnership(“***Buyer***”).**RECITALS**     WHEREAS, the Sellers own all of the issued and outstanding limited and general partnershipinterests of Laser Quitman Gathering Company, LP, a Texas limited partnership (“***Laser Quitman***”),Laser Gathering Company, LP, a Texas limited partnership (“***Laser Gathering***”), Laser Midstream andthe Hesco Companies (as defined below);     WHEREAS, Laser Quitman, Laser Gathering, Laser Midstream and the Hesco Companies (each, a“***Company***,” and together, the “***Companies***”), are engaged in the gathering and processing of naturalgas;     WHEREAS, the Companies own, directly and indirectly, the gathering lines, processingequipment and related assets described on Exhibit A attached hereto;     WHEREAS, the Companies currently own certain Retained Interests and related end user supplylines currently owned by the Companies which will, prior to Closing, be distributed by LaserMidstream to, and retained, by the Sellers (and not sold or transferred to Buyer) pursuant to theRestructuring described in Section 7.2 to this Agreement and the Disclosure Schedules;     WHEREAS, Buyer desires to acquire from Sellers all of the partnership interests of LaserMidstream, Laser Quitman, and Laser Gathering, exclusive of the Retained Interests (collectively,all of such general and limited partnership interests to be acquired by Buyer are referred to asthe “***Interests***”) in exchange for the consideration and pursuant to the terms set forth herein;     WHEREAS, the Sellers desire to (i) sell a portion of the Interests to Buyer in
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consideration for cash and (ii) contribute a portion of the Interests to Buyer in exchange forBuyer Units (as defined below) and the assumption of the Qualified Indebtedness (as defined below),on the terms and subject to the conditions set forth herein; and     WHEREAS, the transfer of the Interests shall be treated as a part sale and part contributionunder Regulations Section 1.707-3(a) as more specifically provided herein.     NOW, THEREFORE, in consideration of the premises and mutual covenants contained herein andother good and valuable consideration, the receipt and sufficiency of which are herebyacknowledged, the Parties agree as follows:**ARTICLE I****DEFINITIONS AND RULES OF CONSTRUCTION**          1.1 Definitions. As used herein, the following terms shall have the following meanings:     “***AAA***” has the meaning provided such term in Section 9.5.     *“****Accountants****”*has the meaning provided such term in Section 2.3(a)(iii).     “***Acquisition Proposal***” has the meaning provided such term in Section 6.8.     *“****Action****”*means any action, appeal, petition, plea, charge, complaint, claim, suit, demand,litigation, arbitration, mediation, hearing, inquiry, investigation or similar event, occurrence orproceeding.     “***Affiliate***” means, with respect to any Person, any other Person that, directly or indirectly,controls, is controlled by or is under common control with, such specified Person through one ormore intermediaries or otherwise, *provided, however,*that with respect to the Sellers and theCompanies, Energy Spectrum shall not be deemed an Affiliate. For the purposes of this definition,“control” means, where used with respect to any Person, the possession, directly or indirectly, ofthe power to direct or cause the direction of the management and policies of such Person, whetherthrough the ownership of voting securities, by contract or otherwise, and the terms “controlling”and “controlled” have correlative meanings.     “***Aggregate Basket Amount***” has the meaning provided such term in Section 9.3(b).
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     “***Agreement***” has the meaning provided such term in the preamble to this Agreement.     “***Arbitrator***” has the meaning provided such term in Section 9.5.     “***Arbitrator’s Decision***” has the meaning provided such term in Section 9.5.     “***Balance Sheet Date***” means January 31, 2007.     “***Business Day***” means any day that is not a Saturday, Sunday or legal holiday in the States ofTexas and New York and that is not otherwise a federal holiday in the United States.     “***Buyer***” has the meaning provided such term in the preamble to this Agreement.     “***Buyer Financial Statements***” has the meaning provided such term in Section 5.9.     “***Buyer Indemnified Parties***” has the meaning provided such term in Section 9.2(a).     “***Buyer Units***” means the Common Units issued pursuant to Section 2.2(a)(ii) hereof.     “***Cash Payment***” has the meaning provided to such term in Section 2.2(a).     “***Cause***” means that Buyer, acting in good faith upon information then known, determines thatthe applicable Retained Employee has engaged in acts or omissions constituting: (a) grossnegligence, willful misconduct, or insubordination in performing or failing to perform his or hermaterial duties and responsibilities; (b) a breach of duty in the course of employment involvingfraud, acts of dishonesty (other than inadvertent acts or omissions), disloyalty,misrepresentation, embezzlement, conversion or intentional damage to or dissipation of property orassets of Buyer or its Affiliates; (c) conduct that is materially detrimental to the Buyer,monetarily or otherwise, or reflects unfavorably on the Buyer, its Affiliates, or the applicableRetained Employee to such an extent that Buyer’s or its Affiliates’ best interests reasonablyrequire the termination of the Retained Employee’s employment; (d) material violation of any of theapplicable Retained Employee’s obligations under any written agreement between the RetainedEmployee and Buyer or its Affiliates or at law; (e) a violation of or subversion of the Buyer’s orits Affiliates’ policies concerning equal employment opportunity, including engaging in sexually orotherwise harassing conduct; (f) the failure to comply with or enforce personnel and other policiesof the Buyer or its Affiliates; (g) the failure to cooperate with any investigation or inquiryauthorized by Buyer or its Affiliates or conducted by a Governmental Authority
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related to the business or the Retained Employee’s conduct; (h) the conviction of, or entry ofa plea agreement or consent decree or similar arrangement with respect to, a felony, other seriouscriminal offense, or any violation of federal or state securities Laws; provided that if Buyerintends to terminate the employment any Retained Employee for Cause under clauses (a),(c) (d), (e)or (f), Buyer will provide Employee with written notice of any event constituting Cause under thoseclauses and will allow such Retained Employee 20 days to cure or rectify any situation, conditionor circumstance giving rise to such Cause asserted by Buyer if, in Buyer’s good faith judgment,such event is capable of being cured.     “***CERCLA***” means the Federal Comprehensive Environmental Response Compensation and LiabilityAct, 42 U.S.C. § 9601 et seq.     “***Claim Notice***” has the meaning provided such term in Section 9.4(a).     “***Claim Settlement Agreement***” has the meaning provided such term in Section 9.4(d).     “***Closing***” has the meaning provided such term in Section 2.4.     “***Closing Consideration***” has the meaning provided such term in Section 2.2.     “***Closing Date***” has the meaning provided such term in Section 2.4.     “***COBRA***” has the meaning provided such term in Section 4.11(d).     “***Code***” means the Internal Revenue Code of 1986, as amended.     “***Comerica Facility***” means the credit facility governed by that certain Credit Agreement datedas of August 4, 2006 by and among Laser Midstream, Comerica Bank, N.A., individually and as agent,and the lenders named therein.     “***Common Units***” means a common unit of limited partnership of Buyer, which are listed on theNASDAQ Global Market.     “***Company***” or “***Companies***” has the meaning provided such term in the recitals to this Agreement.     “***Company Guaranties***” means those guaranties, letters of credit, bonds, sureties and otherforms of credit support or assurances provided by the Sellers in support of obligations of
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the Companies.     “***Company Securities***” has the meaning provided such term in Section 4.3(b).     “***Confidentiality Agreement***” means that certain confidentiality agreement, dated as of January27, 2007, between Buyer and Laser GP.     “***Consideration***” has the meaning provided such term in Section 2.2.     “***Constituents of Concern***” any substance defined as a hazardous substance, hazardous waste,hazardous material, pollutant or contaminant by any Environmental Law, any petroleum hydrocarbon orfraction thereof, friable asbestos, or polychlorinated biphenyls, the handling, storage, treatmentor exposure of or to which is regulated under any Environmental Law.     “***Contract***” means any legally binding agreement, commitment, lease, license or contract, butexcluding Employee Benefit Plans.     “***Direct Claim***” has the meaning provided such term in Section 9.4(d).     “***Disclosure Schedules***” means the schedules attached hereto.     “***Dollars***” and “***$***” mean the lawful currency of the United States.     “***Employee***” means any individual treated by any of the Companies as an employee or employed atcommon law by any of the Companies.     “***Employee Benefit Plan***” has the meaning provided such term in Section 4.11(a).     “***Employee Pension Benefit Plan***” has the meaning provided such term in Section 4.11(a).     “***Employee Welfare Benefit Plan***” has the meaning provided such term in Section 4.11(a).     “***Encumbrance***” means any title defect, mortgage, assignment, pledge, hypothecation, securityinterest, title or retention agreement, levy, execution, seizure, attachment, garnishment, deemedtrust, lien, easement, option, right or claim of others, or charge or encumbrance of any kindwhatsoever, but excluding Permitted Liens.
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     “***Energy Spectrum***” means any of Laser Midstream Energy GP, LLC, Energy Spectrum Partners IVLP, Thomas O. Whitener, Jr. and Peter W. Augustini or any of their Affiliates other than theCompanies and their respective directors, officers and employees.     “***Environmental Law***” means all applicable Laws of any Governmental Authority relating to theprotection of human health or the environment, including: (a) all requirements pertaining toliability for reporting, management, licensing, permitting, investigation, and remediation ofemissions, discharges, releases, or threatened releases of a Constituent of Concern; and (b) alllimitations, restrictions, conditions, standards, prohibitions, obligations, and timetablescontained therein or in any notice or demand letter to the Sellers or any Company issued, entered,promulgated or approved thereunder. The term “***Environmental Law***” includes, without limitation,CERCLA, the Federal Water Pollution Control Act (which includes the Federal Clean Water Act), theFederal Clean Air Act, the Federal Solid Waste Disposal Act (which includes the ResourceConservation and Recovery Act), the Federal Toxic Substances Control Act, and the FederalInsecticide, Fungicide and Rodenticide Act, each as amended as of the date hereof, any regulationspromulgated pursuant thereto, and any state or local counterparts.     “***Environmental Permits***” means all permits, licenses, authorizations, certificates andapprovals of Governmental Authorities relating to or required by Environmental Laws and necessaryfor or held in connection with the conduct of the business.     “***ERISA***” means the Employee Retirement Income Security Act of 1974, as amended.     “***ERISA Affiliate***” has the meaning provided such term in Section 4.11(a).     “***Escrow Account***” means the account maintained by the Escrow Agent and initially funded withthe Escrow Deposit.     *“****Escrow Agent****”*means Wells Fargo Bank (Texas), N.A..     “***Escrow Deposit***” means, in the discretion of the Sellers, either (i) $12,000,000 in cash or(ii) 631,579 Buyer Units having a deemed value of $12,000,000 in either case to be delivered to theEscrow Account in accordance with Section 2.2(e).     “***Escrow Income***” has the meaning provided such term in Section 9.6.
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     “***Estimated Closing Date Balance Sheet***” means an estimated unaudited, consolidated balancesheet of the Companies as of the Closing Date which shall be prepared in accordance with GAAP,consistently applied, subject to normal year-end adjustments and lack of footnotes otherwiserequired by GAAP.     “***Estimated Closing Date Working Capital***” means the estimated Net Working Capital of theCompanies as of the Closing Date as set forth on the Estimated Closing Date Balance Sheet.     “***Estimated Working Capital Adjustment***” has the meaning provided such term in Section2.2(c).     “***Exchange Act***” means the Securities and Exchange Act of 1934, as amended.     “***FERC***” means the United States Federal Energy Regulatory Commission.     “***Final Calculations***” has the meaning provided such term in Section 2.3(a)(i).     “***Final Closing Date Balance Sheet***” means an unaudited, consolidated balance sheet of theCompanies as of the Closing Date which shall be prepared in accordance with GAAP, consistentlyapplied, subject to normal year-end adjustments and lack footnotes otherwise required by GAAP.     “***Final Closing Date Working Capital***” means the Net Working Capital of the Companies as of theClosing Date as set forth on the Final Closing Date Balance Sheet.     “***Financial Statements***” has the meaning provided such term in Section 4.5.     “***GAAP***” means generally accepted accounting principles of the United States, consistentlyapplied.     *“****Good Reason”***means the occurrence of any of the following events with respect to a RetainedEmployee without such Retained Employee’s consent, provided that such Retained Employee has firstprovided Buyer with written notice of any event creating Good Reason, has allowed Buyer 20 days tocure or rectify any situation, condition or circumstance giving rise to such Good Reason assertedby such Retained Employee, and Buyer has not cured or rectified such situation, condition orcircumstance:
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     (i) a Material Diminution in the duties of the Retained Employee with Buyer asagreed to by such Retained Employee and Buyer on or before the Closing Date, or inthe absence of such an agreement, in the duties of the Retained Employee from hisduties on the Closing Date; provided that a change in job title or reportingstructure shall not alone constitute a Material Diminution;     (ii) a reduction in the base salary of the Retained Employee; or     (iii) the relocation of the Retained Employee’s principal place of employmentto a location more than sixty (60) miles from his principal place of employment onthe Closing Date.     “***Governmental Authority***” means any federal, state, municipal, local or similar governmentalauthority, regulatory or administrative agency, court or arbitral body.     “***HESCO Companies***” means HESCO Gathering Company, LLC, a Texas limited liability company, andHESCO Pipeline Company, LLC, a Texas limited liability company.     “***HIPAA***” has the meaning provided such term in Section 4.11(m).     “***HSR Act***” means the Hart-Scott-Rodino Antitrust Improvements Act of 1976, as amended.     “***Inability to Work***” means a Retained Employee’s (i) inability to work legally in the UnitedStates or (ii) inability to perform the essential functions of such Retained Employee’s job byreason of illness or injury for a period of at least twelve (12) weeks in any twelve (12) monthperiod.     “***Indebtedness for Borrowed Money***” means all obligations to any Person for borrowed money,including (a) any obligation to reimburse any bank or other Person in respect of amounts paid orpayable under a standby letter of credit or (b) any guaranty with respect to indebtedness forborrowed money of another Person.     “***Indemnified Party***” has the meaning provided such term in Section 9.4(a).     “***Indemnifying Party***” has the meaning provided such term in Section 9.4(a).
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     “***Individual Basket Amount***” has the meaning provided such term in Section 9.3(b).     “***Intellectual Property***” means intellectual property rights, statutory or common law,worldwide, including (a) trademarks, service marks, trade dress, slogans, logos and all goodwillassociated therewith, and any applications or registrations for any of the foregoing; (b)copyrights and any applications or registrations for any of the foregoing; and (c) patents, allconfidential know-how, trade secrets and similar proprietary rights in confidential inventions,discoveries, improvements, processes, techniques, devices, methods, patterns, formulae,specifications, and lists of suppliers, vendors, customers, and distributors.     “***Interests***” has the meaning provided such term in the recitals of this Agreement.     “***IRS***” means Internal Revenue Service of the United States.     “***Knowledge***” (a) as to the Sellers means the actual knowledge of those Persons listed inSection 1.1(a) of the Disclosure Schedules, and (b) as to any Company means the actualknowledge of those Persons listed in Section 1.1(b) of the Disclosure Schedules. A Personhas “actual knowledge” of those matters which the individual involved could reasonably be expectedto have without undertaking any investigation. The Knowledge of any Company includes Knowledge ofany of the Sellers.     “***Laser Gas***” has the meaning provided such term in the preamble to this Agreement.     “***Laser Gathering***” has the meaning provided such term in the recitals of this Agreement.     “***Laser GP***” has the meaning provided such term in the preamble of this Agreement.     “***Laser Midstream***” has the meaning provided such term in the recitals of this Agreement.     “***Laser Quitman***” has the meaning provided such term in the recitals of this Agreement.     “***Law***” means any applicable statute, writ, law, rule, regulation, ordinance, order, judgment,injunction, award, determination or decree of a Governmental Authority, in each case as in effecton and as interpreted on the date of this Agreement or on and as of the Closing Date, asapplicable, unless the context otherwise clearly requires a different date, in which case on and asof such date.
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     “***Lien(s)***” means any charges, pledges, options, mortgages, deeds of trust, hypothecations, orsecurity interests.     “***Losses***” has the meaning provided such term in Section 9.2(a).     “***Material Adverse Effect***” means, with respect to any Person, any circumstance, change oreffect that (a) is adverse to the business, operations (including results of operation), assets,prospects, liabilities or financial condition of such Person in an amount individually or in theaggregate, of $250,000 or more, or (b) that materially impedes the ability of such Person tocomplete the transactions contemplated herein, but shall exclude any circumstance, change or effectresulting or arising from: (i) any change in general economic conditions in the industries ormarkets in which the Companies operates; (ii) seasonal reductions in revenues and/or earnings ofthe Companies in the ordinary course of its business; (iii) any adverse change, event or effect onthe global energy industry as a whole, including those impacting energy prices or the value of oiland gas assets; (iv) national or international political conditions, including any engagement inhostilities, whether or not pursuant to the declaration of a national emergency or war, or theoccurrence of any military or terrorist attack; (v) changes in Law, GAAP or the interpretationthereof; (vi) the entry into or announcement of this Agreement, actions contemplated by thisAgreement, or the consummation of the transactions contemplated hereby; or (vii) matters only tothe extent such matters are reflected in the Net Working Capital as of the Closing Date.     “***Material Contracts***” has the meaning provided such term in Section 4.9(a).     “***Material Diminution***” means a change in an Employee’s responsibilities which represents amaterial demotion or material diminution from his responsibilities.     **“*****NASDAQ*****”**means The NASDAQ National Stock Market, Inc.     “***Net Working Capital***” means, as of any given date, an amount (which may be positive ornegative) equal to the total consolidated current assets of the Companies as of such date *minus*thetotal consolidated current liabilities of the Companies as of such date, in each case determined inaccordance with GAAP and without giving effect to the transactions contemplated hereby; *provided,however*, that (a) current assets shall not include accounts receivable over 60 days old, and (b)current liabilities shall not include current portion of any long-term indebtedness.
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     “***Non-Retained Employee***” has the meaning provided such term in Section 6.5.     ***“Nontaxable Qualified Liability”***has the meaning provided such term in Section7.2(b)(iii).     “***Notice of Claim Dispute***” has the meaning provided such term in Section 9.4(d).     “***Objection Notice***” has the meaning provided such term in Section 2.3(a)(ii).     **“*****Order*****”**means any order, judgment, injunction, edict, decree, ruling, pronouncement,determination, decision, opinion, sentence, subpoena, writ or award issued, made, entered orrendered by any court, administrative agency or other Governmental Authority or by any arbitrator.     “***Organizational Documents***” means any charter, certificate of incorporation, articles ofassociation, partnership agreements, limited liability company agreements, bylaws, operatingagreement or similar formation or governing documents and instruments.     “***Parties***” means the Sellers, Laser Midstream and Buyer.     “***Permits***” means authorizations, licenses, permits or certificates issued by GovernmentalAuthorities; *provided*, right-of-way agreements and similar approvals are not included in thedefinition of Permits.     “***Permitted Liens***” means (a) Liens for Taxes being contested in good faith by appropriateproceedings or not yet delinquent, (b) statutory Liens (including materialmen’s, warehousemen’s,mechanic’s, repairmen’s, landlord’s, and other similar Liens) arising in the ordinary course ofbusiness securing payments being contested in good faith by appropriate proceedings or not yetdelinquent, (c) restrictive covenants, easements and defects, imperfections or irregularities oftitle or Liens, if any, as would not reasonably be expected to result in a Material Adverse Effecton any Company, (d) Liens related to the Qualified Indebtedness and (e) Liens referenced in theDisclosure Schedules and which shall be released at Closing.     “***Person***” means any individual, firm, corporation, partnership, limited liability company,incorporated or unincorporated association, joint venture, joint stock company, GovernmentalAuthority or other entity of any kind.
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     “***Post-Closing Tax Period***” means any Tax period (or a portion thereof) that is not aPre-Closing Tax Period.     “***Pre-Closing Tax Period***” means any Tax period (or a portion thereof) ending on or before theClosing Date.     **“*****Proceeding*****”**means any action, suit, litigation, arbitration, lawsuit, claim, proceeding(including any civil, criminal, administrative, investigative or appellate proceeding and anyinformal proceeding), prosecution, contests, hearing, inquiry, inquest, audit, examination,investigation, challenge, controversy or dispute commenced, brought, conducted or heard by orbefore, or otherwise involving, any Governmental Authority or any arbitrator.     “***Qualified Indebtedness***” means the funded bank debt owed by the Companies under the ComericaFacility in the expected amount of $37,000,000.     “***Regulations***” means the Treasury Regulations, including Temporary Regulations, promulgated bythe United States Treasury Department under the Code.     “***Representatives***” means a Person’s directors, officers, employees, agents or advisors(including, without limitation, attorneys, accountants, consultants, bankers, financial advisorsand any representatives of those advisors).     “***Restructuring***” has the meaning provided such term in Section 7.2.     “***Restricted Territory***” has the meaning provided such term in Section 6.9(a).     ***“Retained Employees”***has the meaning provided such term in Section 6.5.     **“*****Retained Interests*****”**means all membership and partnership interests of the RetainedSubsidiaries.     **“*****Retained Subsidiaries*****”**means Laser Gas; Laser Gas Company II, LLC, a Delaware limitedliability company; Laser Marketing Company, LP, a Texas limited partnership; and Laser PipelineCompany, LP, a Texas limited partnership**,**and Laser Gathering Company II, LLC, Delaware limitedliability company.     **“*****SEC*****”**means the United States Securities and Exchange Commission.
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     **“*****SEC Reports*****”**has the meaning provided such term in Section 5.8.     “***Securities Act***” means the Securities Act of 1933, as amended.     “***Seller”***or “***Sellers***” has the meaning provided such term in the preamble to this Agreement.     “***Seller Indemnified Parties***” has the meaning provided such term in Section 9.2(b).     “***Sellers’ Representative***” means Laser Midstream II.     “***Severance Payment***” has the meaning provided such term in Section 6.5(a).     “***Straddle Period***” has the meaning provided such term in Section 7.4.     “***Subsidiary***” means, with respect to any Person, (a) any corporation, of which a majority ofthe total voting power of shares of stock entitled (without regard to the occurrence of anycontingency) to vote generally in the election of directors thereof is at the time owned orcontrolled, directly or indirectly, by that Person or one or more of the other Subsidiaries of thatPerson or a combination thereof or (b) any limited liability company, partnership, association orother business entity, of which a majority of the partnership or other similar ownership intereststhereof is at the time owned or controlled, directly or indirectly, by that Person or one or moreSubsidiaries of that Person or a combination thereof. For purposes of this definition, a Person orPersons will be deemed to have a majority ownership interest in a limited liability company,partnership, association or other business entity if such Person or Persons will be allocated amajority of limited liability company, partnership, association or other business entity gains orlosses, or is or controls the managing member or general partner of such limited liability company,partnership, association or other business entity.     “***Systems***” means the pipelines, gathering system, processing plants and related assets of theCompanies, including, but not limited to, those commonly known as Panola Gathering System, RosewoodGathering System, Belle Bower Gathering System, Quitman Gathering System, Simsboro GatheringSystem, Vixen Gathering System, Sligo Gathering System, Greggton Gathering System, Willow SpringsGathering System, McAllen Gathering System, Raymondville Gathering System, Phase 1 20” GatheringSystem, San Ignacio Gathering System, USDA Gathering System, Starr Feedlot Gathering System,Harlingen Gathering System, Platinum Gathering System, Parham Gathering System, Glasscock GatheringSystem, Robinette
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Gathering System, Rosenburg Gathering System, Loma Alta Gathering System, Jamax GatheringSystem, Brownsville Gathering System, Merit JT Gathering System, WB Mission Gathering System, andKiewit Gathering System, along with the office operation located in Shreveport, Louisiana, CorpusChristi, Texas and McAllen Texas.     “***Tax***” *or*“***Taxes***” means all taxes, assessments, charges, duties, fees, levies, imposts or othersimilar charges imposed by a Governmental Authority, including all income, franchise, profits,margins, capital gains, capital stock, transfer, gross receipts, sales, use, transfer, service,occupation, ad valorem, real or personal property, excise, severance, windfall profits, customs,premium, stamp, license, payroll, employment, social security, unemployment, disability,environmental, alternative minimum, add-on, value-added, withholding and other taxes, assessments,charges, duties, fees, levies, imposts or other similar charges of any kind, and all estimatedtaxes, deficiency assessments, additions to tax, penalties and interest, whether disputed orotherwise.     “***Tax Returns***” means any report, return, election, document, estimated tax filing, declaration,claim for refund, information returns, or other filing with respect to any Taxes provided to anyGovernmental Authority including any schedules or attachments thereto and any amendment thereof.     ***“Taxable Qualified Liability”***has the meaning provided such term in Section7.2(b)(iii).     “***Third Party Claim***” has the meaning provided such term in Section 9.4(a).     “***United States***” means United States of America.          1.2 Rules of Construction      (a) All article, section, schedule and exhibit references used in this Agreement are toarticles and sections of, and schedules and exhibits to, this Agreement unless otherwisespecified. The schedules and exhibits attached to this Agreement constitute a part of thisAgreement and are incorporated herein for all purposes.      (b) If a term is defined as one part of speech (such as a noun), it shall have acorresponding meaning when used as another part of speech (such as a verb). Terms definedin the singular have the corresponding meanings in the plural, and vice versa.
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Unless the context of this Agreement clearly requires otherwise, words importing themasculine gender shall include the feminine and neutral genders and vice versa. The term“includes” or “including” shall mean “including without limitation.” The words “hereof,”“hereto,” “hereby,” “herein,” “hereunder” and words of similar import, when used in thisAgreement, shall refer to this Agreement as a whole and not to any particular section orarticle in which such words appear.      (c) With respect to the Companies the term “*ordinary course of business*” will be deemedto refer to the ordinary conduct of the business in a manner consistent with the pastpractices and customs of the Companies.      (d) The Parties acknowledge that each Party and its attorney have reviewed thisAgreement and that any rule of construction to the effect that any ambiguities are to beresolved against the drafting Party, or any similar rule operating against the drafter of anagreement, shall not be applicable to the construction or interpretation of this Agreement.      (e) The captions in this Agreement are for convenience only and shall not be considereda part of or affect the construction or interpretation of any provision of this Agreement.      (f) All references to currency herein shall be to, and all payments required hereundershall be paid in, Dollars.      (g) All accounting terms used herein and not expressly defined herein shall have themeanings given to them under GAAP.
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**ARTICLE II****PURCHASE, SALE & CONTRIBUTION; CLOSING**          2.1 Purchase, Sale and Contribution of Interests At the Closing, upon the terms andsubject to the conditions set forth in this Agreement, the Sellers shall sell, assign, transfer andconvey to Buyer, and Buyer shall purchase and acquire from the Sellers, the Interests, free andclear of any Liens other than Permitted Liens and Liens related to the Qualified Indebtedness andtransfer restrictions imposed thereon by applicable securities Laws.          2.2 Consideration at Closing. At the Closing, Buyer shall pay and/or deliver to theSellers in the manner set forth below, the following consideration (such consideration, the“***Closing Consideration***”). The total Closing Consideration for the Interests shall be equal to$136,725,000 (the “***Consideration***”) to be paid as follows:     (a) Cash Payment. Subject to the adjustments described in Sections 2.2(c)and (g), below, at Closing, Buyer shall pay to the Sellers, by wire transfer ofimmediately available funds to the accounts designated by the Sellers, an amount in cashequal to the sum of $72,975,000 (the “***Cash Payment***”), as partial consideration for theInterests.     (b) Other Consideration. At Closing, Buyer shall provide the followingconsideration to the Sellers as partial consideration for the Interests:     (i) Buyer Units. Buyer shall deliver to the Sellers 1,407,895 CommonUnits (the “***Buyer Units***”) having an agreed value of $26,750,000. Notwithstandingthe forgoing, if the average of the per unit closing prices of the Common Units onthe NASDAQ Global Market, as reported in the Wall Street Journal, for the five (5)consecutive trading days ending on the trading day prior to the Closing Date isbelow $18.00, the Sellers may, by written notice to Buyer, notify Buyer that theSellers elect to terminate this Agreement in accordance with Section 10.1hereof on the date which is five (5) Business Days after the date of such notice.If the Sellers make such election and provide the notice to Buyer as required above,Buyer may elect on or before the expiration of such five (5) Business Day period topay the balance of the Consideration in cash and, if such
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election is made by Buyer, the Sellers will rescind their election to terminatethis Agreement. Notwithstanding the date of delivery of the Buyer Units, Sellershereby waive any and all rights to receive any distribution by Buyer relating to thethree month period ending March 31, 2007, whenever such distribution is declared andregardless of whether Sellers acquire the Buyer Units prior to the setting of anyrecord date with respect to such distribution. The parties hereto agree that suchwaiver is based on the fact that Sellers will not own any Buyer Units during thethree month period ending March 31, 2007 and not the result of any failure of Buyerto fund such distribution to Sellers.     (ii) Assumption of Qualified Indebtedness. Buyer shall assume in fullall of the Qualified Indebtedness.     (iii) Retained Interests. The Sellers shall retain all, and not sellor otherwise assign to Buyer any, of the Retained Interests.     (c) Estimated Working Capital Adjustment. At least five (5) Business Daysprior to the Closing Date, but not including the Closing Date, the Sellers shall prepareand deliver to Buyer (i) an Estimated Closing Date Balance Sheet, which shall reflect thebest estimate of the Sellers of the consolidated assets and liabilities of the Companiesas of the Closing Date, and (ii) the written calculations of Estimated Working CapitalAdjustment (as defined below) of the Sellers, including the Estimated Closing DateWorking Capital. At least one (1) Business Day prior to the Closing Date, but notincluding the Closing Date, Buyer shall deliver a response to the Sellers which includesBuyer’s changes to the Estimated Closing Date Balance, prepared in good faith. If theParties cannot agree on the Estimated Working Capital Adjustment, the adjustment ascalculated by the Sellers shall control. If the Estimated Closing Date Working Capitalis less than zero, then the Consideration and the Cash Payment will be reduceddollar-for-dollar by such difference. If the Estimated Closing Date Working Capital isgreater than zero, then the Consideration and the Cash Payment will be increaseddollar-for-dollar by an amount equal to such excess. Such decrease or increase, if any,in the Consideration and the Cash Payment is hereinafter referred to as the “***EstimatedWorking Capital Adjustment.***”     (d) Resale Registration Statement. Within ninety (90) days after theClosing
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date, Buyer shall file a resale registration statement on Form S-1 or shall amend bypost-effective amendment any existing registration statement on Form S-1 to register theresale of the Buyer Units under the Securities Act. Thereafter, Buyer shall usecommercially reasonable efforts to cause such registration statement or post-effectiveamendment to be declared effective as soon as reasonably practical after the filingthereof and to keep the registration statement continuously effective under theSecurities Act until all Buyer Units have been sold pursuant to such registrationstatement or until Buyer Units are eligible to have restrictive legends removed underRule 144(k) as promulgated under the Securities Act; provided however, Buyer may suspendor delay effectiveness of such registration statement or post-effective amendment ifallowed to and for such time as set forth in any registration rights agreement filed asan exhibit to any report filed by Buyer with the Securities and Exchange Commission.Buyer further agrees to file a post-effective amendment to convert the registrationstatement to a registration statement on Form S-3 under Rule 415 as promulgated under theSecurities Act within thirty (30) days of Buyer’s eligibility to use such Form S-3 for aprimary offering of securities. Additionally, the Sellers hereby agree that, without theprior written consent of Buyer, neither Seller will, during the period commencing on theClosing Date and ending 180 days thereafter (i) offer, pledge, sell, contract to sell,sell any option or contract to purchase, purchase any option or contract to sell, grantany option, right or warrant for the sale of, lend or otherwise dispose of or transfer,directly or indirectly, any equity securities of Buyer, or any securities convertibleinto or exercisable or exchangeable for equity securities of Buyer, or (ii) enter intoany swap or other arrangement that transfers, in whole or in part, directly orindirectly, any of the economic consequences of ownership of any equity securities ofBuyer, whether any such transaction described in clause(i) or (ii) above is to be settledby delivery of Common Units of Buyer or such other securities, in cash or otherwise;provided, however, that the restrictions described in clauses (i) and (ii) shall notapply to Common Units (a) transferred as a gift or gifts or as intra-family transfers ortransfers to trusts or family limited partnerships for estate planning purposes; providedthat any donee thereof agrees in writing to be bound by the terms of this Section2.2(d) or (b) subject to bona fide pledges of securities or transfers to Affiliates,provided the pledgee of such securities or the Affiliate agrees in writing to be bound bythe terms of this Section 2.2(d).
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     (e) Escrow Deposit. The Cash Payment to be delivered at Closing shall bereduced by the Escrow Deposit, which shall be delivered to the Escrow Agent at theClosing and will be available to satisfy any amounts owed by the Sellers to Buyer, ifany, under this Agreement in accordance with the Escrow Agreement attached as ExhibitB; provided, however, that the Sellers shall retain the right to vote any Buyer Unitsand receive cash distributions on any Buyer Units which are held in the Escrow Account.     (f) Reimbursement for Capital Expenditures. The Parties recognize that thedetermination of the Consideration to be paid by Buyer hereunder contemplated that thecapital expenditures of the Companies as set forth in the capital expenditure budget ofthe Companies attached hereto as Exhibit C (the “***Cap Ex Budget***”) be made. To theextent that such capital expenditures have not been spent prior to Closing, theConsideration and the Cash Payment will be reduced by such amount. From and after theBalance Sheet Date, the Companies will not undertake any capital expenditures other thanthose set forth in the Cap Ex Budget. Any additional capital expenditures not previouslyidentified must be approved by Buyer in advance. The Consideration and the Cash Paymentpaid at Closing shall be increased by the amount of the capital expenditures approved byBuyer, excluding emergency or force majeure related capital expenditures.     (g) Qualified Indebtedness Adjustment. The amount of Qualified Indebtedness(expected to be $37,000,000) assumed by Buyer shall be equal to the actual amount offunded debt owed under the Comerica Facility on the Closing Date. The Consideration andthe Cash Payment paid at Closing shall be increased or decreased, as applicable, by theamount of any differences between $37,000,000 and the actual amount of QualifiedIndebtedness on the Closing Date.     2.3 Post-Closing Adjustment for Final Net Working Capital and Qualified Indebtedness.          (a) Calculation of Final Working Capital.     (i) As soon as reasonably practicable following the Closing Date, and in anyevent within ninety (90) days thereafter, Buyer shall prepare and deliver to
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the Sellers a Final Closing Date Balance Sheet and a calculation of the FinalClosing Date Working Capital (the “***Final Calculations***”).     (ii) The Sellers shall have the right to review and verify the Final ClosingDate Balance Sheet and the Final Calculations. Buyer shall provide the Sellers andtheir Representatives reasonable access to the records and employees of theCompanies and shall cause the employees of the Companies to cooperate in allreasonable respects with the Sellers in connection with their review of such workpapers and other documents and information relating to the Final Calculations as theSellers shall reasonably request and that are available to the Buyer and the Sellersor their independent public accountants. If, within forty-five (45) days after theSellers’ receipt of the Final Calculations, the Sellers shall not have given writtennotice to Buyer of objection thereto, then the Sellers shall be deemed to haveaccepted the Final Calculations, which shall then be final, binding and conclusivefor all purposes hereunder. In the event that the Sellers give written notice ofany objection to the Final Closing Date Balance Sheet or the Final Calculations (an“***Objection Notice***”) within such forty-five (45) day period, then the Sellers andBuyer will use all commercially reasonable efforts to resolve the disputed matter(s)within the thirty (30) day period following the delivery of such Objection Notice.     (iii) If, at the end of the thirty (30) day resolution period, the Parties areunable to resolve any disagreement between them with respect to the preparation ofthe Final Calculations, then each Party shall deliver simultaneously to BDO Seidman,LLP (or if such firm is unwilling or unable to serve, another nationally recognizedaccounting firm mutually agreed on by the Parties; the accounting firm ultimatelychosen, the “***Accountants***”) the Objection Notice and such work papers and otherreports and information relating to the disputed matter(s) as the Accountants mayrequest and shall be afforded the opportunity to discuss the disputed matter(s) withthe Accountants. The Accountants shall have thirty (30) days to carry out a reviewand prepare a written statement of its determination regarding the disputedmatter(s) (including a statement regarding the Accountants’ determination of theprevailing Party in any such disputed matter) which determination shall be final andbinding upon the Parties. Any fees and
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expenses of the Accountants incurred in resolving the disputed matter(s) shallbe borne equally by the Parties.       (b) Final Net Working Capital Adjustment. If the Final Closing Date WorkingCapital is less than the Estimated Closing Date Working Capital, then the Sellers shallpromptly, but in any event within five (5) Business Days, pay such difference to Buyer incash by wire transfer of immediately available funds to the account designated by Buyer.If the Final Closing Date Working Capital is greater than the Estimated Closing DateWorking Capital, Buyer shall promptly, but in any event within five (5) Business Days,pay such excess to the Sellers in cash by wire transfer of immediately available funds tothe accounts designated by the Sellers.          2.4 The Closing. The closing of the transactions contemplated by this Agreement (the“Closing”) shall take place at the offices of Thompson & Knight LLP, 333 Clay Street, Suite 3300,Houston, Texas 77002, commencing on the earlier to occur of (i) April 30, 2007; (ii) the third(3rd) Business Day following the satisfaction or waiver of all conditions to the obligations of theParties set forth in Article VIII; or (iii) such other date as permitted in this Agreement or asBuyer and the Sellers may mutually determine (the date on which the Closing occurs is referred toherein as the “Closing Date”).
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**ARTICLE III****REPRESENTATIONS AND WARRANTIES RELATING TO THE SELLERS**     Except as set forth on the Disclosure Schedules delivered by the Sellers to Buyer at or priorto the execution and delivery of this Agreement, each section of which qualifies thecorrespondingly numbered representation, warranty or covenant contained herein to the extentspecified therein, the Sellers jointly and severally represent and warrant to Buyer as follows:          3.1 Organization of Certain Sellers. Laser Midstream II is a limited partnership dulyorganized, validly existing, and in good standing under the Laws of the jurisdiction of itsincorporation (or other formation). Laser GP is a limited liability company duly organized, validlyexisting and in good standing under the Laws of the State of Texas. Laser Gas is a limitedliability company duly organized, validly existing and in good standing under the Laws of the Stateof Delaware.          3.2 Authorization; Enforceability. Each Seller has full capacity, power and authority(including full corporate or other entity power and authority) to execute and deliver thisAgreement and to perform its obligations hereunder. This Agreement has been duly and validlyexecuted and delivered by the Sellers, and this Agreement constitutes a valid and bindingobligation of each Seller, enforceable against such Seller in accordance with its terms, subject toapplicable bankruptcy, insolvency, fraudulent conveyance, reorganization, moratorium and similarLaws affecting creditors’ rights generally and subject, as to enforceability, to general principlesof equity.          3.3 No Conflict; Consents. The execution and delivery of this Agreement by each Seller andthe consummation of the transactions contemplated hereby by such Seller do not and shall not:     (a) violate any Law applicable to the Sellers or require any filing with, consent,approval or authorization of, or notice to, any Governmental Authority;     (b) violate any Organizational Document of such Seller;     (c) require any filing with or permit, consent or approval of, or the giving of
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any notice to, any Person; or     (d) breach or trigger any right to purchase by or payment to any Person under anyMaterial Contract or other agreement to which Seller is a party or is bound; (i) resultin the termination of any Material Contract, or (ii) result in the creation of any Lienupon any of the Interests, either upon the consummation of the transactions contemplatedhereby or after notice or lapse in time.          3.4 Ownership of Interests. Such Seller is the lawful owner, beneficially and of record ofthe Interests in the respective Companies set forth in the Disclosure Schedule, free and clear ofany Liens or Encumbrances of any kind or nature, other than Liens related to the QualifiedIndebtedness. The Interests of the Companies set forth in the Disclosure Schedule constitute onehundred percent (100%) of the limited and general partnership interests of the Companies. Uponconsummation of the transactions contemplated hereby, Buyer will acquire good, valid andindefeasible title to all the Interests of such Seller, free and clear of any Liens orEncumbrances.          3.5 Litigation. As of the date of this Agreement (a) there are no lawsuits or actionsbefore any Governmental Authority pending or, to the Knowledge of any Seller, threatened in writingagainst any Seller that would reasonably be expected to have a Material Adverse Effect on theability of such Seller to perform its obligations under this Agreement, (b) there are no orders orunsatisfied judgments from any Governmental Authority binding upon any Seller that would reasonablybe expected to have a Material Adverse Effect on the ability of such Seller to perform itsobligations under this Agreement.          3.6 Disclosure. No representation or warranty made by the Sellers or any Company in thisAgreement, and no statement of Seller or any Company contained in any document, certificate, orother writing furnished or to be furnished by the Sellers or any Company pursuant hereto or inconnection herewith, contains or will contain, at the time of delivery, any untrue statement of amaterial fact or omits or will omit, at the time of delivery, to state any material fact necessaryin order to make the statements contained therein, in light of the circumstances under which theyare made, not misleading. The Sellers know of no matter which has not been disclosed to Buyerpursuant to this Agreement which has or, so far as the Sellers can now reasonably foresee, willhave a Material Adverse Effect. The Sellers have delivered or made available to Buyer accurate andcomplete copies of all agreements, documents, and other writings referred to or listed in thisAgreement or in the Disclosure Schedules.
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             3.7 Solvency. Each Seller is now, and will be at Closing, solvent and will not be renderedinsolvent by any of transactions described hereunder.             3.8 Securities Representations.     (a) Each Seller is acquiring the Buyer Units for its own account and not with a viewto, or for offer of resale in connection with, a distribution thereof, within the meaningof the Securities Act. In acquiring the Buyer Units, such Seller is not offering orselling, and will not offer or sell, for himself or itself in connection with anydistribution of the Buyer Units, and such Seller does not have a participation in andwill not participate in any such undertaking or in any underwriting of such anundertaking except in compliance with applicable federal and state securities Laws.     (b) Each Seller is an “accredited investor” as such term is defined under RegulationD promulgated under the Securities Act. Additionally, each Seller acknowledges that heor it is able to fend for itself, can bear the economic risk of its investment in theBuyer Units, and has such knowledge and experience in financial and business matterssimilar to the transaction described herein such that it is capable of evaluating themerits and risks of an investment in the Buyer Units.     (c) Further, each Seller understands that such Buyer Units will not have beenregistered pursuant to the Securities Act or any applicable state securities Laws, thatthe Buyer Units, when issued, will be characterized as “restricted securities” underfederal securities Laws, and that under such Laws and applicable regulations the BuyerUnits cannot be sold or otherwise disposed of without registration under the SecuritiesAct or an exemption therefrom. Each such Seller represents that he or it is familiarwith Rule 144 promulgated under the Securities Act, as currently in effect, andunderstands the resale limitations imposed thereby and by the Securities Act. Stoptransfer instructions may be issued to the transfer agent for securities of the Buyer (ora notation may be made in the appropriate records of the Buyer) in connection with theBuyer Units issued hereunder. It is agreed and understood by such Seller that, shouldany certificate be issued representing any of the Buyer Units, each such certificateshall conspicuously set forth on the face or back thereof, in addition to any legendsrequired
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by applicable Law or other agreement, a legend in substantially the following form:THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTEREDPURSUANT TO THE SECURITIES ACT OF 1933, AS AMENDED, OR ANY STATE SECURITIESLAWS. SUCH SECURITIES MAY NOT BE SOLD OR OTHERWISE TRANSFERRED UNLESS THEYARE FIRST REGISTERED PURSUANT TO THAT ACT AND APPLICABLE STATE SECURITIES LAWSOR UNLESS EAGLE ROCK ENERGY PARTNERS, L.P. RECEIVES A WRITTEN OPINION OFCOUNSEL, WHICH OPINION AND COUNSEL ARE SATISFACTORY TO THE CORPORATION, TO THEEFFECT THAT SUCH REGISTRATION IS NOT REQUIRED.     Each Seller represents and acknowledges that Buyer is issuing the Buyer Units pursuantto an exemption from the registration requirements of the Securities Act based on therepresentations provided by the Sellers hereunder.
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**ARTICLE IV****REPRESENTATIONS AND WARRANTIES RELATED TO THE COMPANIES**     Except as set forth on the Disclosure Schedules delivered by the Sellers to Buyer at or priorto the execution and delivery of this Agreement, each section of which qualifies thecorrespondingly numbered representation, warranty or covenant contained herein to the extentspecified therein, each Seller and Laser Midstream, jointly and severally, represent and warrant toBuyer as follows:          4.1 Organization. Each of the Companies is duly organized, validly existing, and in goodstanding under the Laws of the jurisdiction of its incorporation (or other formation) and has therequisite organizational power and authority (including full corporate or other entity power andauthority) to own or lease its assets and to conduct its business as it is now being conducted.Each of the Companies is duly licensed or qualified in each jurisdiction in which the ownership oroperation of its assets or the character of its activities are such as to require it to be solicensed or qualified, except where the failure to be so licensed or qualified would not reasonablybe expected to have a Material Adverse Effect on the Companies taken as a whole. The Sellers havemade available to Buyer true copies of all existing Organizational Documents of the Companies.          4.2 No Conflict; Consents. The execution and delivery of this Agreement by Laser Midstreamand the consummation of the transactions contemplated hereby by Laser Midstream do not and shallnot:     (a) violate any Law applicable to the Companies or require any filing with, consent,approval or authorization of, or notice to, any Governmental Authority;     (b) violate any Organizational Document of the Companies;     (c) require any filing with or permit, consent or approval of, or the giving of anynotice to, any Person, except as required by the HSR Act; or     (d) (i) breach any Material Contract to which any Company is a party or by which anyCompany may be bound, (ii) result in the termination of any such Material
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Contract, (iii) result in the creation of any Lien under any Material Contract or(iv) constitute an event that, after notice or lapse of time or both, would result in anysuch breach, termination or creation of a Lien.             4.3 Capitalization.     (a) The Interests constitute all of the issued and outstanding equity interests ofthe Companies. The Interests are duly authorized, validly issued, fully paid,nonassessable and are free and clear of any Lien or other limitation or restriction(including any restriction on the right to vote, sell or otherwise dispose of suchInterests, subject only to applicable securities Laws), other than Liens related to theQualified Indebtedness and except as set forth in the Organizational Documents of theCompanies.     (b) There are no (i) outstanding membership interests, equity interests or othersecurities of the Companies other than the Interests, (ii) outstanding securities of theCompanies convertible into, exchangeable or exercisable for membership interests, equityinterests or other securities of such entity, (iii) authorized or outstanding options,warrants or other rights to purchase or acquire from the Companies, or obligations of theCompanies to issue, any equity interests or other securities, including securitiesconvertible into or exchangeable for membership interests or other securities of suchentity, or (iv) authorized or outstanding bonds, debentures, notes or other indebtednessthat entitles the holders to vote (or convertible or exercisable for or exchangeable intosecurities that entitle the holders to vote) with holders of units or interests of theCompanies on any matter (the items in clauses (i), (ii), (iii) and (iv) being referred tocollectively as the “***Company Securities***”). There are no outstanding obligations of theCompanies to repurchase, redeem or otherwise acquire any Company Securities, except asset forth in the Organizational Documents of the Companies.     (c) Except as described in the Disclosure Schedules, none of the Companies (i) owns,directly or indirectly, any capital stock, equity interests or other securities of anyPerson, or (ii) has any Subsidiaries.             4.4Litigation. No Company is (a) subject to any outstandinginjunction,
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judgment, order, decree, ruling, or charge or, (b) a party to any action, suit, proceeding,hearing, or investigation of, in, or before any court or quasi-judicial or administrative agency ofany federal, state, local, or foreign jurisdiction. To the Knowledge of the Sellers, no suchaction, suit, proceeding, hearing or investigation has been threatened against any Company.             4.5 Financial Statements; Internal Controls; Undisclosed Liabilities.     (a) Section 4.5 of the Disclosure Schedules includes the followingconsolidated financial statements (collectively, the “***Financial Statements***”): (i) auditedbalance sheets together with the related statements of income (loss), changes in owners’equity, and cash flows as of and for the fiscal years ended December 31, 2005 for theCompanies and all of the Retained Subsidiaries (the “Audited Financial Statements”); and(ii) (A) unaudited balance sheets together with the related statements of income (loss),changes in owners’ equity, and cash flows as of and for the fiscal years ended December31, 2006 for the Companies and all of the Retained Subsidiaries; and (B) consolidatedunaudited pro forma balance sheets, as of the Balance Sheet Date, and the statements ofearnings and statements of cash flow as of and for the one month period ended as of theBalance Sheet Date, of the Companies other than the Retained Subsidiaries (collectively,the “Unaudited Financial Statements”). The Financial Statements (including the notesthereto) have been prepared in accordance with GAAP applied on a consistent basisthroughout the periods covered thereby and fairly present in all material respects thefinancial condition of the Companies (and the Retained Subsidiaries as applicable) as ofsuch dates and the results of operations of the Companies (and the Retained Subsidiariesas applicable) for such periods; provided, however, that the Unaudited FinancialStatements are subject to normal year-end adjustments and lack footnotes otherwiserequired by GAAP. No Company is a party to any off-balance sheet arrangements that haveor are reasonably likely to have a current or future Material Adverse Effect on theCompanies taken as a whole.     (b) None of the Companies has received written notice from any GovernmentalAuthority concerning noncompliance with, or deficiencies in, such Company’s financialreporting practices. All material transactions have been properly recorded in theaccounting records underlying the Financial Statements. There are no significantdeficiencies, including material weaknesses, in the design or operation of
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internal control over the financial reporting of the Companies. To the Knowledge ofthe Sellers, no member of the management of the Companies or any other employee with asignificant role in the internal control of the Companies over financial reporting hascommitted any act of fraud having a material effect on the Financial Statements.     (c) None of the Companies has received or otherwise had or obtained Knowledge of anycomplaint, allegation, assertion or claim, whether written or oral, alleging fraud orsuspected fraud affecting such Company.             4.6 Taxes. Except as set forth in the Disclosure Schedules, (a) all Tax Returns requiredto be filed by the Companies have (and as of the Closing Date will have) been timely filed (takinginto account any extension of time to file granted or obtained) for all Taxable periods and suchreturns are correct in all respects, except where any such failure to file would not have aMaterial Adverse Effect on the Companies taken as a whole, (b) all Taxes due on such Tax Returnshave been paid, will be timely paid prior to the Closing Date, or are adequately reserved againstin the Financial Statements, (c) there are no Liens on any of the assets of the Companies thatarose in connection with any failure to pay any Tax (other than Liens for Taxes not yet due andpayable), (d) there is no claim or adjustment pending by any Governmental Authority in connectionwith any Tax, (e) no Tax Returns are under audit or examination by any Governmental Authority, (f)there are no agreements or waivers currently in effect that provide for an extension of time withrespect to the filing of any Tax Return or the assessment or collection of any Tax, (g) no claimhas been made by any Governmental Authority in a jurisdiction where the Companies do not file a TaxReturn that it is or may be subject to taxation in that jurisdiction, (h) the Companies are notparties to any Tax allocation or sharing arrangement, (i) the Companies have always been treated aseither partnerships or disregarded entities for federal income tax purposes and have not made anelection (nor will such election be made prior to the Closing Date) to be treated as an associationtaxable as a corporation for federal income tax purposes, (j) no Company is a “foreign person”within the meaning of Section 1445 of the Code and the Regulations promulgated thereunder, (k) eachCompany has complied in all material respects with all applicable Laws relating to the payment andwithholding of Taxes, and has duly and timely withheld and paid over to the appropriateGovernmental Authority all amounts required to be so withheld and paid under all applicable Laws,and (l) at least 90% of the income of the Companies for the 12-month period preceding the ClosingDate has been, or is expected to be, “qualifying income” within the meaning of Code Section7704(d).
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          4.7 No Undisclosed Liabilities. None of the Companies has Indebtedness for Borrowed Money,obligation or liability of any kind (whether accrued, absolute, contingent or otherwise, andwhether due or to become due) that would have been required to be reflected in, reserved against orotherwise described on the Financial Statements or in the notes thereto in accordance with GAAP(although the Unaudited Financial Statements are subject to normal year-end adjustments and lackfootnotes otherwise required by GAAP), that (a) is not shown on the Financial Statements or thenotes thereto or (b) was not incurred in the ordinary course of business since the Balance SheetDate.          4.8 Absence of Certain Changes. From the Balance Sheet Date until the date of thisAgreement, (a) there has not been any Material Adverse Effect on the Companies taken as a whole and(b) the business of the Companies taken as a whole has been conducted, only in the ordinary course.          4.9 Contracts.     (a) Schedule 4.9 contains a true and complete listing of the followingContracts in effect on the date of this Agreement and to which any Company is a party(each such Contract being a “***Material Contract***” and together the “***Material Contracts***”):     (i) except for any intercompany indebtedness that will be cancelled prior toClosing, each Contract for Indebtedness for Borrowed Money**;**     (ii) each natural gas purchase, sale, transportation, gathering and processingservices Contract;     (iii) each Contract involving a remaining commitment by any Company toundertake capital expenditures in excess of $50,000;     (iv) each Contract for lease of personal property or real property (butexcluding easements and rights of way which are described in Section 4.17 ofthe Disclosure Schedules) that involves aggregate annual payments in excess of$50,000 ;     (v) each employment Contract;
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     (vi) except for Contracts of the nature described in clause (ii) above, eachMaterial Contract between any Company or an Affiliate of such Company on the onehand, and another Company, on the other hand, that will survive the Closing and thatcannot be cancelled by either Company upon thirty (30) days or less notice withoutpayment penalty;     (vii) each Contract pursuant to which any Company acquired assets or a businessas a going concern;     (viii) each Contract regarding the construction or operation of the assets andbusiness owned by any Company;     (ix) each Contract that provides for a limit on the ability of any Company tocompete in any line of business or with any person or in any geographic area duringany period of time after Closing; and     (x) except for Contracts of the nature described in clauses (i) through (vii)above, each contract involving aggregate payments by or to any Company in excess of$50,000 in any future calendar year that cannot be terminated by any Company upon 60days or less notice without payment penalty.     (b) True and complete copies of all Material Contracts have been made available toBuyer.     (c) Each Material Contract (other than such Material Contracts with respect to whichall performance and payment obligations have been fully performed or otherwise dischargedby the Companies thereto prior to the Closing) (i) is in full force and effect and (ii)represents the legal, valid and binding obligation of the applicable Company partythereto and, to the Knowledge of the Sellers and Laser Midstream, represents the legal,valid and binding obligation of the other parties thereto, in each case enforceable inaccordance with its terms. No Company is in material breach of any Material Contract,and no Company has received any written or, to the Knowledge of the Sellers and LaserMidstream, oral notice of termination or breach of any Material Contract.             4.10 Intellectual Property.
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     (a) The Companies own or have the right to use pursuant to license, sublicense,agreement or otherwise all items of Intellectual Property required in the operation oftheir business as presently conducted;     (b) no party has asserted in writing against any Company a claim that such Companyis infringing on the Intellectual Property of such third party; and     (c) to the Knowledge of the Sellers and Laser Midstream, no third party isinfringing on the Intellectual Property owned by any Company. Section 4.10 ofthe Disclosure Schedules sets forth a list of all software licenses to which such Companyis a party and all Intellectual Property used by such Company.             4.11 Employee Benefit Plans.     (a) The Employee Benefit Plans established, maintained, contributed to, or requiredto be contributed to by any Company or any entity with which such Company is considered asingle employer under Section 414(b), (c), (m) or (o) of the Code (an “***ERISA Affiliate”***)or with respect to which any Company or any ERISA Affiliate has any liability (contingentor otherwise) are set forth on Schedule 4.11(a). As used in this Agreement,“***Employee Benefit Plan***” means any plan, program, policy, practice, agreement or otherarrangement providing compensation or benefits in any form to any current or formeremployee, co-employee, independent contractor, officer or director of any Company or anyERISA Affiliate or any beneficiary or dependent thereof, whether written or unwritten,formal or informal, including any “employee welfare benefit plan” within the meaning ofSection 3(1) of ERISA (“***Employee Welfare Benefit Plan***”), any “employee pension benefitplan” within the meaning of Section 3(2) of ERISA (whether or not such plan is subject toERISA) (“***Employee Pension Benefit Plan***”) and any other pension, profit sharing, bonus,incentive compensation, deferred compensation, vacation, sick pay, stock purchase, stockoption, phantom equity, equity compensation, severance, employment, consulting,unemployment, hospitalization or other medical, life or other insurance, long orshort-term disability, change of control, fringe benefit or any other similar plan,program or policy.     (b) With respect to each Employee Benefit Plan, the Companies have provided Buyerwith a true, correct and complete copy of: (i) each writing constituting
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a part of such Employee Benefit Plan (including, but not limited to, the plandocument(s), adoption agreement, prototype or volume submitter documents, trustagreement, annuity contract, third party administrative contracts and insurancecontracts) and all amendments thereto; (ii) the three most recent Annual Reports (Form5500 Series) including all applicable schedules, if required; (iii) the current summaryplan description and any material modifications thereto, if required to be furnishedunder ERISA, or any written summary provided to participants with respect to any plan forwhich no summary plan description exists; (iv) all notices received by any Company or anyERISA Affiliate by the IRS, Department of Labor, Pension Benefit Guaranty Corporation orother governmental agency relating to such Employee Benefit Plan; and (v) a writtendescription of each oral Employee Benefit Plan.     (c) No Employee Benefit Plan is intended to be “qualified” within the meaning ofSection 401(a) of the Code, and the only Employee Pension Benefit Plan maintained by theCompanies and their ERISA Affiliates is a simple retirement account program that isintended to meet the requirements of Section 408(p) of the Code. The Companies do notmaintain, contribute to or have any liability under a nonqualified deferred compensationplan subject to Section 409A of the Code.     (d) No Employee Welfare Benefit Plan is subject to Sections 419A(b) and 419A(c) ofthe Code. All Employee Welfare Benefit Plans required to comply with the health carecontinuation coverage (“***COBRA***”) provisions of ERISA and the Code or similar state Lawshave complied with such requirements.     (e) Each Employee Benefit Plan has been operated and administered in accordance withits provisions and applicable Laws. All contributions required to be made to anyEmployee Benefit Plan (or to any person pursuant to the terms thereof) have been timelymade or the amount of such payment or contribution obligation has been reflected in theFinancial Statements. All such contributions to an Employee Benefit Plan representingparticipant contributions have been made within the time required by applicable Law.     (f) The Companies and their Affiliates have complied, and are now in compliance withall provisions of ERISA, the Code and all Laws and Regulations applicable to theEmployee Benefit Plans. Neither the Companies nor any of their
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Affiliates has engaged in any prohibited transaction, within the meaning of Section4975 of the Code or Section 406 of ERISA, as a fiduciary or party in interest withrespect to any Employee Benefit Plan which could reasonably be expected to result in anyliability, and, to the knowledge of Sellers and Laser Midstream, (i) no prohibitedtransaction has occurred with respect to any Employee Benefit Plan and (ii) no fiduciaryhas any liability for breach of fiduciary duty or any other failure to act or comply inconnection with the administration or investment of assets of any Employee Benefit Plan.     (g) Neither the Companies nor any entity that is or has been an ERISA Affiliate ofthe Companies within the six years preceding the date of this Agreement has, within thesix year period preceding the date of this Agreement sponsored, maintained, orcontributed to any employee benefit plan subject to Title IV of ERISA or Section 412 ofthe Code. No current or former Employee Welfare Benefit Plan is a multiple employerwelfare arrangement as defined in Section 3(40) of ERISA. No current or former EmployeePension Benefit Plan is a multiemployer plan as defined in Section 3(37)(A) of ERISA.     (h) The Companies and their Affiliates have not offered to provide life, health ormedical benefits or insurance coverage to any individual, or to the family members of anyindividual, for any period extending beyond the termination of the individual’semployment, except to the extent required by the COBRA provisions in ERISA and the Codeor similar provisions of state law, or death benefits for which premiums are paid solelyby the employee or death benefits that are part of a simple retirement account..     (i) The consummation of the transactions contemplated by this Agreement will not,either alone or in connection with termination of employment or any other event, (i)entitle any current or former employee, co-employee, independent contractor, director orofficer of the Companies or their Affiliates to severance pay, any change in controlpayment or any other payment, except as expressly provided in this Agreement, (ii)accelerate the time of payment or vesting, change the form or method of payment orincrease the amount of compensation due, any such employee, co-employee, independentcontractor, director or officer, or (iii) result in the disallowance of a deduction underSection 280G of the Code or an excise tax under Section 4999 of the
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Code with respect to any such payment. Neither the Companies nor any Affiliate ofthe Companies has taken any action that would result in its incurring any obligation forany payments or benefits described in subsections (i) or (ii) of this Section4.11(i) (without regard to whether the transactions contemplated by this Agreementare consummated) except to the extent required in a written contract or agreement inexistence as of the date of this Agreement or as provided in Section 6.5 of thisAgreement.     (j) As of the date of this Agreement, there are no suits, actions, proceedings,investigations, claims or orders pending or, to the knowledge of Sellers or LaserMidstream, threatened against any Company, any Affiliate of a Company or any EmployeeBenefit Plan, related to any Employee Benefit Plan (other than claims in the ordinarycourse of business). As of the date of this Agreement, no Employee Benefit Plan issubject to any ongoing audit, investigation or other administrative proceeding of anygovernmental entity, and no Employee Benefit Plan is the subject of any pendingapplication for administrative relief under any voluntary compliance program or closingagreement program of the IRS or the Department of Labor.     (k) Except as otherwise provided in this Agreement, each Company has the right toamend or terminate each Employee Benefit Plan with respect to such Company and itsAffiliates at any time without incurring any liability other than with respect tobenefits that have already accrued, become payable or been incurred under an EmployeeBenefit Plan.     (l) Except as provided in Section 6.5, neither any Company nor any ERISA Affiliateof a Company has a formal plan, commitment or proposal, whether legally binding or not,nor has any of them made a commitment to employees, co-employees, officers, directors,consultants or independent contractors to create any additional Employee Benefit Plan ormodify or change any existing Employee Benefit Plan to increase benefits, and no suchplan, commitment or proposal is under serious consideration. To the knowledge of Sellersor Laser Midstream, no events have occurred or are expected to occur with respect to anyEmployee Benefit Plan that would cause a material change in the cost of providing thebenefits under such plan or would cause a material change in the cost of providing forother liabilities of such plan.
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     (m) Each Employee Benefit Plan that is a “group health plan,” as defined in Section607(1) of ERISA, Section 5000(b)(1) of the Code or 45 C.F.R. Section 160.103, has beenoperated at all times in compliance with the provisions of HIPAA and any applicable,similar state law. As used in this Agreement, “***HIPAA***” means the provisions of ERISA andthe Code enacted by the Health Insurance Portability and Accountability Act of 1996,including any Regulations promulgate thereunder, and the regulations promulgated by theUnited States Department of Health and Human Services as set forth in 45 C.F.R. Parts160, 162, and 164.
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             4.12 Environmental Matters. Except as set forth in Section 4.12 of the DisclosureSchedules:     (a) To the Knowledge of the Sellers and Laser Midstream, the operations of theCompanies are in compliance with all Environmental Laws, which compliance includes thepossession and maintenance of, and compliance with, all material Environmental Permits;     (b) The Companies are not subject to any outstanding order, judgment or arbitrationaward from any Governmental Authority under any Environmental Laws requiring remediationof any Constituents of Concern or the payment of any material fine or penalty; and     (c) The Companies are not subject to any action pending or threatened in writing,whether judicial or administrative, alleging noncompliance with or potential liabilityunder any Environmental Law.             4.13 Compliance with Laws; Permits.     (a) To the Knowledge of the Sellers and Laser Midstream, the Companies are incompliance with all applicable Laws. Notwithstanding any provision in this Section4.13 (or any other provision of this Agreement) to the contrary, Section 4.11and Section 4.12, shall be the exclusive representations and warranties withrespect to employee benefits and environmental issues, as well as related matters, and noother representations or warranties are made with respect to such matters, includingwithout limitation pursuant to this Section 4.13.     (b) The Companies possess all Permits necessary to own their respective assets andoperate their respective business as currently conducted. All such Permits are in fullforce and effect. There are no lawsuits or other proceedings pending or, to theKnowledge of the Sellers, threatened in writing before any Governmental Authority thatseek the revocation, cancellation, suspension or adverse modification thereof. EachCompany has complied with all requirements and has taken all actions necessary to obtainand maintain the applicable Permits in full force and effect.
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             4.14 Insurance. Section 4.14 of the Disclosure Schedules contains a summary description ofall material policies of property, fire and casualty, product liability, workers’ compensation andother insurance held by or for the benefit of any Company as of the date of this Agreement. Allpolicies are in effect, and no Company has received any rejected claim notice, any notice ofcancellation. To the Knowledge of the Sellers and Laser Midstream, all policies are capable ofbeing renewed in substantially the same coverages and coverage amounts upon payment of a reasonablysimilar premium payment.             4.15 Labor Relations; Employment Matters.     (a) Section 4.15(a) of the Disclosure Schedules identifies all Employees byname; employer; position or job title; initial date of hire; seniority or service creditdate if different from initial date of hire; status (whether active or on leave absence,and if on leave, the type of leave); compensation by type (base salary, commission,bonus, and the like); and accrued but unused vacation, sick or other paid leave and therate at which such paid leave is accrued.     (b) Except as set forth in the Disclosure Schedules, (i) no Company is a party to,bound by, or negotiating any collective bargaining agreement or other labor unioncontract; (ii) there are no current or to the Knowledge of the Sellers and LaserMidstream, threatened organizational campaigns, petitions or other unionizationactivities with respect to the Employees and there have not been any such activitieswithin the past three (3) years; (iii) there is no current, pending, or, to the Knowledgeof the Sellers and Laser Midstream, threatened strikes, disputes, slowdowns, workstoppages or other labor controversy involving any Company or the Employees and therehave not been any such activities within the past three (3) years; (iv) there are nounfair labor practice complaints or any union representation questions or certificationpetitions involving any Company or any Employee pending before the National LaborRelations Board and there have been no such complaints, questions or petitions within thelast three (3) years.     (c) Except as set forth in the Disclosure Schedules, (i) no Company is a party toany Contract or agreement of employment or to provide consulting or personal servicesthat cannot be terminated at will without notice by and at no expense to such Company;(ii) each Company has timely paid or made provision for payment of, and
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has properly accrued for in the Financial Statements, all accrued salaries, wages,commissions, bonuses, severance pay, vacation, sick, and other paid leave with respect toany current or former employee or on account of employment; (iii) no severance payment,stay-on or incentive payment, change-in-control payment, vacation, sick or other paidleave payment, or similar payment or obligation will be owed by any Company to anydirector, officer, Employee or other persons upon consummation of, or as a result of, thetransactions contemplated by this Agreement, nor will any such director, officer,Employee or other person be entitled to any such payments a result of the transactionscontemplated by this Agreement in the event of the subsequent termination of his or heremployment or relationship; (iv) no current or former employee or person claiming to beor have been an employee has a right to be recalled, reinstated, or restored toemployment under any agreement, law, or policy or practice of any Company; (v) no Companyis a party to, or otherwise bound by, any Order or settlement with respect to any currentor former employee, the terms and conditions of employment, or the working conditions ofany employee; (vi) no Company has or is required by applicable Law to have an affirmativeaction plan; (vii) each Company has complied with the Older Workers’ Benefit ProtectionAct with respect to any waivers of liability under the Age Discrimination in EmploymentAct obtained by it in the last 300 days; and (viii) no Company has had a “plant closing”or “mass layoff” as those terms are defined in the Worker Adjustment and RetrainingNotification Act (“WARN”) within the last four year (4) years.     (d) Each Company has complied, and is in compliance, with all Laws (including thecommon law) relating to employment and employment practices, terms and conditions ofemployment, labor relations, wages, hours of work and overtime, worker classification,employment-related immigration and authorization to work in the United States,occupational safety and health, and privacy of health information. There are no pendingor, to the Knowledge of the Sellers and Laser Midstream, threatened Proceedings of anykind and in any forum by or on behalf of any present or former employee, applicant,person claiming to be an employee, or any classes of the foregoing, alleging orconcerning a violation of, or compliance with, any Law (including the common law)relating to employment and employment practices, terms and conditions of employment,labor relations, wages, hours of work and overtime, worker classification,employment-related immigration and authorization to work in
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the United States, occupational safety and health, or privacy of health information,and there have been no such Proceedings within the past three (3) years. There is nocurrent or, to the Knowledge of the Sellers and Laser Midstream, threatened Proceeding inany forum in which any current or former director, officer, Employee or agent of anyCompany is or may be entitled to indemnification. No Company has breached and is not inbreach of any Contract for the employment of any individual on a full-time, part-time,consulting, or other basis.             4.16 Books and Records. The books of account, minute books, membership interest transferbooks and other records of the Companies, all of which have been made available to the Buyer, are(i) complete and correct, (ii) accurately and fairly reflect in reasonable detail the transactionsand dispositions of the assets of the issuer; and (iii) maintained in accordance with a system ofinternal accounting controls sufficient to provide reasonable assurances that (a) transactions areexecuted in accordance with management’s general or specific authorization; (b) transactions arerecorded as necessary (I) to permit preparation of financial statements in conformity withgenerally accepted accounting principles and (II) to maintain accountability for assets; (c) accessto assets is permitted only in accordance with management’s general or specific authorization; and(d) the recorded accountability for assets is compared with the existing assets at reasonableintervals and appropriate action is taken with respect to any differences. The minute books of theCompanies contain accurate and complete records of all meetings held of and action taken by themembers and managers of the Companies and no meeting of such members or of any such managers hasbeen held for which minutes have not been prepared and are not contained in such minute books. Atthe Closing, all of those books and records will be in the possession of the Sellers.             4.17 Title to Properties and Related Matters.     (a) Section 4.17(a) of the Disclosure Schedules describes the Systems along with allreal property, leaseholds or other interests in real property owned by the Companies.The Sellers have delivered or made available to the Buyer copies of the deeds and otherinstruments (as recorded) by which the applicable Company acquired the Systems and suchreal property and interests, and copies of all title insurance policies, opinions,abstracts and surveys in the possession of such Company and relating to such property orinterests.
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     (b) Other than Permitted Liens, the interests of the Companies in and to the Systemsare now, and will be at Closing, free and clear of all Encumbrances.     (c) Subject to the completion of the Restructuring, the Companies own, with good andindefeasible title in the case of real property, and good title with respect to all otherassets, including, but not limited to the Systems, subject only to the Permitted Liens,all the properties and assets (real, personal and mixed, tangible and intangible)reflected as owned in the books and records of the applicable Company, including, but notlimited to, all the properties and assets reflected in the balance sheet (except forassets held under capitalized leases disclosed and personal property sold since theBalance Sheet Date in the ordinary course of business and consistent with past practice),and all the properties and assets purchased or otherwise acquired by the applicableCompany since the Balance Sheet Date (except for personal property acquired and soldsince the Balance Sheet Date in the ordinary course of business and consistent with pastpractice). All tangible assets are in good working condition, except for normal wear andtear and except for such assets not in good working condition and have been maintained inaccordance with standard industry practice and the assets sufficient to allow eachCompany to conduct its business immediately after the Closing Date consistent withhistorical operations of the Companies.     (d) All buildings, plants and structures owned by the Companies lie wholly withinthe boundaries of the real property owned by the applicable Company and do not encroachupon the property of, or otherwise conflict with the property rights of, any otherPerson.             4.18 Brokers’ Fees. No broker, finder, investment banker or other Person is entitled toany brokerage fee, finders’ fee or other commission in connection with the transactionscontemplated by this Agreement based upon arrangements made by any Company.             4.19 Company Guaranties. Section 4.19 of the Disclosure Schedules contains acomplete and accurate list of all Company Guaranties necessary to operate the business and assetsof the Companies. No Company has Knowledge of any proposed increase to the amount of any CompanyGuaranty upon the consummation of the transactions contemplated hereby.             4.20 No “Take or Pay”. There are currently no arrangements under any of the
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Material Contracts by which any Company will be obligated by virtue of a prepayment arrangement, a“take-or-pay“ arrangement, a production payment or any other arrangement, to sell, transport ordeliver hydrocarbons at some future time without then or thereafter being entitled to receive fullpayment therefor, or to make payment at some future time for hydrocarbons or the transportation orthe delivery of hydrocarbons purchased or transported prior to the date of this Agreement.          4.21 Pipeline Easements. No Company has received written notice of default or terminationfrom any third Person and neither the Sellers nor any Company have Knowledge of any deficiency inany easement or right of way with respect to the entire route of all pipelines owned and used orheld for use with respect to any asset which is a gathering line, processing plant or relatedfacility which might result in a material impairment or loss of title to the real property of thevalue thereof or which could hinder or impede the operations of the Systems or materially affectthe ability of Buyer to own and operate the Systems from and after Closing in the ordinary courseof business as conducted by the applicable Company prior to Closing. Other than sales orassignments to customers, any Company has not sold or assigned any easement, in whole or in part,or any undivided interest therein to any party whatsoever.          4.22 Pipeline Matters. Section 4.22 of the Disclosure Schedules sets forth summaryhistorical throughput data (but only to the extent any Company possess such throughput data) forthe period of January 1, 2006 through February 28, 2007, including volume information.          4.23 Insider Interests. No member, manager, partner, director, shareholder, officer,employee, or Affiliate of any Company or any associate thereof is presently, directly orindirectly, a party to any transaction with any Company, including, without limitation, anyagreement, arrangement, or understanding, written or oral, providing for the employment of,furnishing of services by, rental of real or personal property from, or otherwise requiringpayments to any such member, manager, partner, director, shareholder, officer, employee, Affiliate,or associate thereof. No member, manager, partner, director, shareholder, officer, employee, orAffiliate of any Company (other than Thomas O. Whitener, Jr. and Peter W. Augustini) or anyassociate thereof owns, directly or indirectly, any interest in, or serves as a director, officer,or employee of, any customer, supplier, or competitor of any Company. For purposes of this Sectiononly, an “associate” of any member, manager, partner, director, shareholder, officer, or employeemeans (i) a spouse, parent, sibling, child, mother- or father-in-
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law, son- or daughter-in-law, or brother- or sister-in-law of such member, manager, partner,director, shareholder, officer, or employee or (ii) any corporation, partnership, trust, or otherentity in which such member, manager, partner, director, shareholder, officer, or employee orassociate thereof has a substantial ownership or beneficial interest (other than an interest in apublic corporation which does not exceed three percent of its outstanding securities) or is adirector, officer, partner, or trustee or person holding a similar position.          4.24 FCC Licenses. None of the Companies are required to carry, hold, or maintain anylicense, permit, certificate, approval, franchise, consent, waiver, registration, or otherauthorization issued by the Federal Communications Commission.          4.25 Receivables. All receivables (including accounts and notes receivable, employeeadvances, and accrued interest receivables) of the Companies as reflected on the UnauditedFinancial Statements or arising since the date thereof are valid obligations of the respectivemakers thereof and have arisen in the ordinary course of business for goods or services deliveredor rendered, and, to the Knowledge of the Sellers and Laser Midstream, are not subject to any validdefenses, counterclaims, or set offs, and have been collected or are collectible in full at theirrecorded amounts in the ordinary course of business without resort to litigation or otherextraordinary collection efforts, net of all cash discounts and doubtful accounts as reflected onthe Unaudited Financial Statements (in the case of receivables so reflected) or on the books of theCompanies (in the case of receivables arising since the date thereof). The allowances for doubtfulaccounts reflected on the Unaudited Financial Statements and on the books of the Companies weredetermined in accordance with generally accepted accounting principles and were and are reasonablein light of historical data and other relevant information.          4.26 Bank Accounts and Powers of Attorney. Section 4.26 of the DisclosureSchedules includes (i) the name and address of each bank or other financial institution with whichthe Companies have an account or safe deposit box or vault, the account and safe deposit box andvault numbers thereof, the purpose of each thereof, and the names of all persons authorized to drawthereon or to have access thereto, (ii) the names of all persons authorized to borrow funds onbehalf of the Companies and the names and addresses of all entities from which they are authorizedto borrow funds, and (iii) the names of all persons, if any, holding proxies, powers of attorney,or other like instruments from any Company. No such proxies, powers of attorney, or other likeinstruments are irrevocable.
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          4.27 Investments. The temporary cash investments reflected on the balance sheets includedin the Unaudited Financial Statements have maturities not more than 12 months from the date ofacquisition by a Company and consist of: (i) securities issued or guaranteed or insured by theUnited States of America or any agency or instrumentality thereof; (ii) time deposit certificatesof deposit and banker’s acceptances of commercial banks organized under the Laws of the UnitedStates of America or any state thereof with total assets of more than $50,000,000; (iii) commercialpaper issued by any person incorporated in the United States rated at least A-2 or the equivalentthereof by Standard & Poor’s Corporation or at least P-2 or the equivalent thereof by Moody’sInvestors Service, Inc.; or (iv) shares of money market funds substantially all of whose assets arecomprised of securities or assets of the type described in clauses (i) through (iii) above.          4.28 Illegal Payments. None of the Companies or any director, officer, employee, or agentof the Companies has, directly or indirectly, paid or delivered any fee, commission, or other sumof money or item of property however characterized to any broker, finder, agent, governmentofficial, or other person, in the United States or any other country, in any manner related to thebusiness or operations of the Companies, which the Companies or any such director, officer,employee, or agent knows or has reason to believe to have been illegal under any applicable Law.          4.29 Offerings of Securities. All securities which have been offered or sold by theCompanies have been registered pursuant to the Securities Act and applicable state securities Lawsor were offered and sold pursuant to valid exemptions therefrom. No registration statement,prospectus, private offering memorandum, or other information furnished (whether in writing ororally) to any offeree or purchaser of such securities, at the time such registration statementbecame effective (in the case of a registered offering) or at the time of delivery of suchregistration statement, prospectus, private offering memorandum, or other information, containedany untrue statement of a material fact or omitted to state any material fact required to be statedtherein or necessary in order to make the statements contained therein, in light of thecircumstances under which they were made, not misleading. The Companies have no obligation toregister any of their securities under the Securities Act.
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**ARTICLE V****REPRESENTATIONS AND WARRANTIES RELATING TO BUYER**     Buyer hereby represents and warrants to the Sellers as follows:          5.1 Organization. Buyer is a limited partnership duly organized, validly existing and ingood standing under the Laws of the State of Delaware and has the requisite organizational powerand authority to own or lease its assets and to conduct its business as it is now being conducted.          5.2 Authorization; Enforceability. Buyer has all requisite limited partnership power andauthority to execute and deliver this Agreement and to perform all obligations to be performed byit hereunder. The execution and delivery of this Agreement and the consummation of thetransactions contemplated hereby have been duly and validly authorized and approved by Buyer, andno other limited partnership proceeding on the part of Buyer is necessary to authorize thisAgreement. This Agreement has been duly and validly executed and delivered by Buyer, and thisAgreement constitutes a valid and binding obligation of Buyer, enforceable against Buyer inaccordance with its terms, subject to applicable bankruptcy, insolvency, fraudulent conveyance,reorganization, moratorium and similar Laws affecting creditors’ rights generally and subject, asto enforceability, to general principles of equity.          5.3 Capitalization. The Buyer Units, and the limited partner interests representedthereby, are duly authorized in accordance with the Organizational Documents of Buyer and arevalidly issued, fully paid and nonassessable and are free and clear of any Lien, other thanPermitted Liens, or other limitation or restriction (including any restriction on the right tovote, sell or otherwise dispose of the Buyer Units, subject only to applicable securities Laws),except as set forth in the Organizational Documents of Buyer. Except as set forth in the SECReports, Buyer is not currently prohibited, directly or indirectly, from making distributions withrespect of the Buyer Units or from repaying any loans or advances or from transferring any propertyor assets to any of its Subsidiaries. The Common Units of the Buyer that make up the Buyer Unitsconform to the description thereof in the SEC Reports.          5.4 No Conflict; Consents. The execution and delivery of this Agreement by Buyer and theconsummation of the transactions contemplated hereby by Buyer do not and shall
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not:     (a) violate any Law applicable to Buyer or require any filing with, consent,approval or authorization of, or, notice to, any Governmental Authority;     (b) violate any Organizational Document of Buyer; or     (c) require any filing with or permit, consent or approval of, or the giving of anynotice to, any Person, except as required by the HSR Act.          5.5 Litigation. As of the date of this Agreement (a) there are no lawsuits or actionsbefore any Governmental Authority pending or threatened in writing against Buyer that wouldreasonably be expected to have a Material Adverse Effect on the ability of Buyer to perform itsobligations under this Agreement and (b) there are no orders or unsatisfied judgments from anyGovernmental Authority binding upon Buyer that would reasonably be expected to have a MaterialAdverse Effect on the ability of Buyer to perform its obligations under this Agreement.          5.6 Brokers’ Fees. No broker, finder, investment banker or other Person is entitled to anybrokerage fee, finders’ fee or other commission in connection with the transactions contemplated bythis Agreement based upon arrangements made by any Company.          5.7 Financial Ability. Buyer has, through a combination of cash on hand and funds readilyand unconditionally available under existing lines of credit, funds sufficient to fund theconsummation of the transactions contemplated by this Agreement and satisfy all other costs andexpenses arising in connection therewith.          5.8 Independent Investigation**.**Buyer and its Representatives have undertaken anindependent investigation and verification of the business, operations and financial condition ofthe Companies. Except for the representations and warranties made by the Sellers in this Agreementor in any certificate or written statement furnished or to be furnished to Buyer pursuant to thisAgreement or in connection with the transactions contemplated hereby, the Buyer acknowledges thatthere are no representations or warranties, whether oral or written, express or implied, as to thecondition (financial or otherwise), assets, liabilities, operations, business or prospects of eachCompany, as to the accuracy or completeness of information obtained by Buyer during itsinvestigationof each Company, and in entering into and performing
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this Agreement, Buyer has relied and will rely solely upon its independent investigation of, andjudgment with respect to, each Company, its value and the Interests.          5.9 SEC Filings. Buyer has heretofore filed all forms, reports, registrationstatements, definitive proxy statements, schedules and other materials with the SEC required to befiled pursuant to the Exchange Act or other federal securities Laws since October of 2006. (the“***SEC Reports***”). As of their respective dates, or, if applicable, the dates such SEC Reports wereamended prior to the date hereof, the SEC Reports (including, without limitation, all financialstatements included therein, exhibits and schedules thereto and documents incorporated by referencetherein) complied in all material respects with all applicable requirements (including but notlimited to the Sarbanes-Oxley Act to the extent then in effect and applicable) of the SecuritiesAct or the Exchange Act, as applicable, and other federal securities Laws as of the date thereof.The SEC Reports, when filed and as amended from time to time, did not contain any untrue statementof a material fact or omit to state any material fact required to be stated therein or necessary inorder to make the statements made therein, in light of the circumstances under which they weremade, not misleading; provided, however, that no representation is made as to the accuracy of anyfinancial projections or forward looking statements, or the completeness of any informationfurnished by Buyer to the SEC solely for purposes of complying with Regulation FD promulgated bythe SEC under the Exchange Act or other information that is treated by SEC regulations as not being“filed” for the purposes of the Exchange Act. The financial statements of Buyer included in theSEC Reports, including the related notes thereto including the related notes thereto (the “***BuyerFinancial Statements***”), when filed, fairly presented in all material respects the consolidatedfinancial position and the consolidated results of operations and cash flows of the Buyer as of thedates thereof or for the periods presented therein.          5.10 Tax Status. Since its formation and through the date of this Agreement, Buyerhas been a partnership for federal income tax purposes and not taxed as a corporation under CodeSection 7704(a).
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**ARTICLE VI****COVENANTS**          6.1 Conduct of Business.     (a) From the date of this Agreement through the Closing, the Sellers shall cause theCompanies to operate their business in the ordinary course and, without limiting thegenerality or effect of the foregoing, the Sellers will use their commercially reasonableefforts to cause each Company to preserve intact its business and its relationships withcustomers, suppliers and others having business relationships with such Company, in eachcase in all material respects.     (b) Without limiting the generality or effect of Section 6.1(a) and exceptfor the Restructuring or as otherwise set forth on Section 6.1 of the DisclosureSchedule, prior to the Closing, the Sellers shall cause each Company not to, and theSellers and each Company shall not take any action to permit any other Company to:     (i) amend its Organizational Documents;     (ii) liquidate, dissolve, recapitalize or otherwise wind up its business;     (iii) except as required by Law or in the ordinary course of business, (A)grant or increase any bonus, salary, severance, termination or other compensation orbenefits or other enhancement to the terms or conditions of employment to any of itsemployees (other than bonuses granted at or prior to the Closing in connection withthe transactions contemplated hereby and paid prior to the Closing or taken intoaccount in the determination of the Net Working Capital), (B) make any change in itskey management structure or (C) adopt, enter into or amend in any material respectany Employee Benefit Plan;     (iv) change its accounting methods, policies or practices, except as requiredby applicable Law;     (v) sell, assign, transfer, lease or otherwise dispose of any materialnon-current assets except pursuant to the terms of a Material Contract;
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     (vi) make any capital expenditure other than as permitted in Section2.2(f) hereof;     (vii) incur any indebtedness outside the ordinary course of business consistentwith past practices of any Company, other than in accordance with the Cap Ex Budgetattached hereto as Exhibit C;     (viii) merge or consolidate with, or purchase substantially all of the assetsor business of, or equity interests in, or make an investment in any Person (otherthan extensions of credit to customers in the ordinary course of business);     (ix) issue or sell any equity interests, notes, bonds or other securities ofany Company (except for intercompany loans from or to the Sellers or theirAffiliates in the ordinary course of business), or any option, warrant or right toacquire same;     (x) amend any Tax Return or settle or compromise any federal, state, local orforeign Tax liability or enter into any agreement or preliminary settlement with anyGovernmental Authority concerning Taxes; make any Tax election except electionsconsistent with past practices and that are required to be made in connection withTax Returns filed for any Tax period ending on or prior to the Closing Date; filewith, or provide to, any Governmental Authority any waiver extending the statutoryperiod for assessment or reassessment of Taxes or any other waiver of restrictionson assessment or collection of any Taxes; or     (xi) agree, whether in writing or otherwise, to do any of the foregoing.          6.2 Access. From the date hereof through the Closing, the Sellers shall afford Buyer andits authorized Representatives reasonable access, during normal business hours and in such manneras not to unreasonably interfere with normal operation of the business, to the properties, books,contracts, records and appropriate officers and employees of the Companies and shall furnish suchauthorized Representatives with all financial and operating data and other information concerningthe affairs of the Companies as Buyer and such Representatives may reasonably request. The Sellersshall have the right to have a Representative present at all times during any such inspections,interviews and examinations. Additionally, Buyer shall hold in confidence all such information onthe terms and subject to the conditions contained in the
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Confidentiality Agreement. Notwithstanding the foregoing, Buyer shall have no right of access to,and the Sellers shall have no obligation to provide to Buyer, information relating to (i) bidsreceived from others in connection with the transactions contemplated by this Agreement (or similartransactions) and information and analyses (including financial analyses) relating to such bids;(ii) any information the disclosure of which would jeopardize any privilege available to theCompanies or the Sellers relating to such information or would cause the Companies or the Sellersto breach a confidentiality obligation; or (iii) any information the disclosure of which wouldresult in a violation of Law. Buyer and the Sellers shall cooperate to ensure that the provisionof access hereunder to Buyer and its authorized Representatives shall comply in all respects withthe FERC’s Standards of Conduct for Transmission Providers set forth in 18 C.F.R. Part 37, et al.          6.3 Third Party Approvals. Buyer and the Sellers shall (and shall each cause theirrespective Affiliates to) use commercially reasonable efforts to obtain all material consents andapprovals of third parties that any of Buyer, the Companies, or their respective Affiliates arerequired to obtain in order to consummate the transactions contemplated hereby.          6.4 Regulatory Filings.     (a) From the date of this Agreement until the Closing, the Parties shall, and shallcause their respective Affiliates to:     (i) make or cause to be made the filings required by such Party or any of itsAffiliates under any Laws with respect to the transactions contemplated by thisAgreement, including filings required under the HSR Act;     (ii) comply, as promptly as is reasonably practicable, with any requestsreceived by such Party or any of its Affiliates under the HSR Act and any other Lawsfor additional information, documents or other materials;     (iii) cooperate with the other Party and furnish all information in suchParty’s possession that is necessary in connection with such other Party’s filings;     (iv) promptly inform the other Party of any communication from or to, and anyproposed understanding or agreement with, any Governmental Authority in respect ofsuch filings;
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     (v) consult and cooperate with the other Party in connection with any analyses,appearances, presentations, memoranda, briefs, arguments and opinions made orsubmitted by or on behalf of any Party in connection with all meetings, actions andproceedings with Governmental Authorities relating to such filings;     (vi) use commercially reasonable efforts to cause the expiration of the noticeor waiting periods under the HSR Act and, if applicable, any other Laws with respectto the transactions contemplated by this Agreement as promptly as is reasonablypracticable;     (vii) use commercially reasonable efforts to resolve any objections as may beasserted by any Governmental Authority with respect to the transactions contemplatedby this Agreement; and     (viii) use commercially reasonable efforts to contest and resist any action orproceeding instituted (or threatened in writing to be instituted) by anyGovernmental Authority challenging the transactions contemplated by this Agreementas in violation of any Law.     (b) If a Party intends to participate in any meeting with any Governmental Authoritywith respect to such HSR Act filings, it shall give the other Party reasonable priornotice of such meeting.     (c) In connection with any filing under the HSR Act, Buyer and Laser Midstream IIagree to split any filing fee equally. If this Agreement is terminated or the Closingdoes not otherwise occur for any reason other than the fault of the Sellers, Buyer shallbe responsible for the entire filing fee.          6.5 Employee and Benefit Matters.     (a) From and after the date hereof, Buyer shall have the right to interview andevaluate each of the Employees of the Companies for retention with Buyer. On or beforethe date that is ten (10) Business Days after the date of this Agreement, Buyer shallnotify the Sellers in writing of the identities of any Employees that will not beretained by Buyer after the Closing Date (“***Non-Retained Employees***”). On or before theClosing Date the Sellers shall terminate the employment of all such Non-Retained
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Employees or transfer the employment of all such Non-Retained Employees to an entitywhose Interests are not being acquired by Buyer. Any severance payment or othercompensation due to any Non-Retained Employee as a result of such termination or transferof employment shall be the responsibility and liability of the Sellers and included as acurrent payable in the Net Working Capital adjustment. Any obligation or liability withrespect to the Employees, or relating to employment or terms and conditions ofemployment, arising on or before the Closing Date, and with respect to the Non-RetainedEmployees, arising on or after the Closing Date, shall be the sole responsibility of theSellers, and the Sellers shall indemnify and hold harmless Buyer and its respectiveAffiliates with respect to any such liability or losses. Any severance payment, othercompensation, or Loss resulting from the termination upon or after the Closing Date ofthe employment of any Employee not designated by Buyer as a Non-Retained Employee inaccordance with the requirements of this Section 6.5(a) (each such Employee a“**Retained Employee**”) shall be the responsibility and liability of Buyer. Except asotherwise provided in this Section 6.5(a), the Sellers shall indemnify and holdharmless Buyer and its respective Affiliates with respect to all Losses relating to orarising out of Buyer’s designation of Non-Retained Employees and the employment, termsand conditions of employment, termination, or transfer of the employment of Non-RetainedEmployees (including any claim of discrimination or other illegality in such designation,termination, or transfer). Except as expressly provided herein, Buyer shall be solelyresponsible for all employee benefits, compensation and all other liabilities withrespect to the Retained Employees with respect to such Retained Employees’ service fromand after the Closing Date. On or before the first anniversary of the Closing Date, ifBuyer terminates the employment of any Retained Employee, other than for retirement,voluntary resignation by the Retained Employee, death, Inability to Work, or Cause, or ifany Retained Employee terminates employment with Buyer for Good Reason, such RetainedEmployee shall be entitled to receive upon termination a severance payment (the“***Severance Payment***”)from Buyer in a lump sum amount equal to the Retained Employee’ssalary in effect on the Closing Date for six (6) months; provided, however, that thepayment of such Severance Payment shall be delayed for a period of six (6) months and two(2) days after the Employee’s separation from service if such Retained Employee is a“specified employee” as defined in, and such delay is required by, Section 409A of theCode and guidance issued thereunder. Nothing in this Agreement obligates the Buyer
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or its Affiliates to retain the employment of any Retained Employee for anyspecified period of time after the Closing Date or limits the right of Buyer or itsAffiliates to terminate the employment of any Retained Employee at any time, with orwithout advance notice, and for any reason; provided, however, that Buyer shall providethe Retained Employees with salary and benefits which are in the aggregate equal to thesalary and benefits provided to such Retained Employees by the applicable Company andBuyer shall provide the Retained Employees with service credit for eligibility andvesting purposes (but not for purposes of benefit accruals) under the employee benefitplans, programs and policies of Buyer on the same basis as previously provided suchRetained Employees for service with the Companies and any predecessors under the EmployeeBenefit Plans.     (b) The Companies shall cease making contributions to the simple individualretirement accounts of the Retained Employees after the Closing Date, and the simpleindividual retirement accounts for the Non-Retained Employees shall be assumed by LaserMidstream II or one of its Affiliates as of the Closing Date. The Companies will have noliability under or in connection with such individual simple retirement accounts.     (c) Prior to the Closing, Laser Midstream II will assume the Equity ParticipationPlan maintained by Laser Midstream. The Companies will have no liability under or inconnection with such Equity Participation Plan.          6.6 Books and Records. From and after the Closing, Buyer shall preserve and keep a copy ofall books and records relating to the business or operations of the Companies on or before theClosing Date in Buyer’s possession for a period of at least five (5) years after the Closing Date.After such five (5) year period, before Buyer shall dispose of any such books and records, Buyershall give the Sellers at least ninety (90) days’ prior notice to such effect, and the Sellersshall be given an opportunity, at their cost and expense, to remove and retain all or any part ofsuch books and records as the Sellers may select. Buyer shall provide to the Sellers, at no costor expense to the Sellers, full access to such books and records as remain in Buyer’s possessionand full access to the properties and employees of Buyer and the Companies in connection withmatters relating to the business or operations of the Companies on or before the Closing Date andany disputes relating to this Agreement.
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          6.7 Permits. The Companies shall provide all notices and otherwise take all actionsrequired to transfer or reissue any Permits, including those required under Environmental Laws, asa result of or in furtherance of the transactions contemplated by this Agreement. The Companiesshall cooperate with Buyer to provide information necessary to apply for such Permits.          6.8 Acquisition Proposals. From and after the date of this Agreement until the earlier ofthe Closing or the termination of this Agreement, none of the Companies, or any Affiliate thereofshall, directly or indirectly, (i) solicit, initiate, or knowingly encourage any AcquisitionProposal (defined below) or (ii) engage in discussions or negotiations with, or disclose anynonpublic information relating to the Companies to, any Person that is considering making or hasmade an Acquisition Proposal. The Companies and their Affiliates shall immediately cease and causeto be terminated any existing activities, discussions, or negotiations with any persons conductedheretofore with respect to any Acquisition Proposal and shall promptly request each such Person whohas heretofore entered into a confidentiality agreement in connection with an Acquisition Proposalto return to Seller and the Companies all confidential information heretofore furnished to suchperson by or on behalf of any of the Sellers or any Company. If any of the Sellers, any of theCompanies or any of their respective Affiliates shall hereafter receive any Acquisition Proposal,such Seller and such Company shall immediately communicate to Buyer that it has received anAcquisition Proposal. The term “***Acquisition Proposal***”, as used herein, means any offer or proposalfor, or any indication of interest in, a merger, sale consolidation or other business combinationinvolving any Company or its assets or the acquisition of any equity interest in any Company, otherthan the transactions contemplated by this Agreement.          6.9 Noncompetition and Nonsolicitation.     (a) The Sellers acknowledge that in consideration of the payment of theConsideration, Buyer is purchasing the business, including complete ownership and controlof such business, which includes the inherent goodwill related thereto of the Companies.Therefore, the Sellers agree that for a period commencing upon the Closing Date andending upon the six month anniversary thereof, the Sellers will not and will not permitany Affiliate, directly or indirectly, either as an employee, employer, consultant,agent, principal, partner, stockholder, corporate officer, director, or in any otherindividual or representative capacity, engage or participate in any
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business or activity that is in competition in any manner whatsoever with the gastransmission, gathering, producer services or processing business of the Companies orBuyer at the date hereof within the geographical locations listed on Schedule 6.9hereto (the “***Restricted Territory***”), provided, however that the Sellers may continuethrough the ownership of the Retained Subsidiaries to operate any assets owned by, orengage in the gas transmission, gathering, producer services or processing business ofthe Companies or Buyer through, such Retained Subsidiaries as of the Closing Date.     (b) From the six month anniversary of the Closing Date through the third anniversaryof the Closing Date, the Sellers shall remain subject to the restrictions of Section6.9(a), but in addition to the exemptions permitted by Section 6.9(a), theSellers and/or the Retained Subsidiaries may acquire, after the Closing Date, eitherdirectly or indirectly, assets or contracts, or entities owning assets or contracts,located within or relating to the Restricted Territory and related to the gastransmission, gathering, producer services or processing business of the Companies orBuyer; *provided, however*, that the Sellers and/or the Retained Subsidiaries shall beprohibited from the use of such assets or contracts in competition with Buyer in the gastransmission, gathering, producer services or processing business only within, but notoutside of, the Restricted Territory until the third anniversary of the Closing Date.     (c) The Sellers represent to Buyer that the enforcement of the restriction containedin Section 6.9(a) and (b) would not be unduly burdensome to the Sellersand that in order to induce Buyer to enter into this Agreement, the Sellers furtherrepresent and acknowledge that each of them is willing and able to compete in areas otherthan the Restricted Territory.     (d) The Sellers agree that a breach or violation of this covenant not to compete bythe Sellers shall entitle Buyer, as a matter of right, to an injunction issued by anycourt of competent jurisdiction, restraining any further or continued breach or violationof this covenant. Such right to an injunction shall be cumulative and in addition to,and not in lieu of, any other remedies to which Buyer may show itself justly entitled.Further, during any period in which either Seller is in breach of this covenant not tocompete, the time period of this covenant shall be extended for an amount of time thatsuch Seller is in breach hereof.
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     (e) In the event that Sellers, during the period commencing on the Closing Date andending on the eighteen month anniversary of the Closing Date, desires to sell or exchange(a “Disposition”) assets or contracts, or entities owning assets or contracts,located within or relating to the counties or parishes which are or were part of theRestricted Territory, Sellers shall have no right to make such Disposition without firstgiving notice to Buyer of its desire to make such Disposition. If the Sellers eitherhave a bona fide offer from a third party for such Disposition or desire to solicitoffers from third parties for such Disposition, the notice shall contain a sufficientdescription of the applicable assets, business plans, historical and future financialdata to allow Buyer to make a bona fide offer. Buyer may exercise its rights under thisSection 6.9(e) by delivering written notice within ten (10) Business Days of itsreceipt of the notice of intent to make the Disposition sent by Sellers. The failure ofBuyer to exercise such right within such ten (10) Business Day period shall be regardedas a waiver of its right to acquire the assets or contracts, or entities covered by theDisposition Notice. If Sellers do not complete the Disposition within a period of six(6) months after the initial notice from Sellers to Buyer, Sellers shall be required toagain comply with the provisions of this Section 6.9(e) before making aDisposition.     (f) In addition to the restrictions set forth in Section 6.9(a) and(b), each Seller shall not nor will it permit any Affiliate, for a periodcommencing upon the Closing Date and ending upon the third anniversary thereof, eitherdirectly or indirectly, (i) make known to any person the names and addresses of any ofthe customers of the Companies or contacts of the Companies within the industry or anyother information pertaining to such customers or contacts or (ii) call on, solicit, ortake away, or attempt to call on, solicit, or take away, any of the customers of theCompanies *provided, however*, such Sellers shall be permitted to solicit or attempt tosolicit such customers for business outside the Restricted Territory. In addition, for aperiod commencing upon the Closing Date and ending eighteen months thereafter, eachSeller shall not nor will it permit any Affiliate to recruit or hire or attempt torecruit or hire, directly or by assisting others, any employee of any Company while theyare employed by such Company.     (g) The representations and covenants contained in this Section 6.9 on thepart of the Sellers will be construed as ancillary to and independent of any otherprovision
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of this Agreement, and the existence of any claim or cause of action of the Sellersagainst Buyer or any officer, director, or shareholder of Buyer, whether predicated onthis Agreement or otherwise, shall not constitute a defense to the enforcement by Buyerof the covenants of the Sellers contained in this Section 6.9.     (h) If either Seller violates any covenant contained in this Section 6.9 andBuyer brings legal action for injunctive or other relief, Buyer shall not, as a result ofthe time involved in obtaining the relief, be deprived of the benefit of the full periodof any such covenant. Accordingly, the covenants of the Seller contained in thisSection 6.9 shall be deemed to have durations as specified above, which periodsshall commence upon the later of (i) the Closing Date and (ii) the date of entry by acourt of competent jurisdiction of a final judgment enforcing the covenants of theSellers in this Section 6.9.     (i) The parties to this Agreement agree that the limitations contained in thisSection 6.9 with respect to time, geographical area, and scope of activity arereasonable. However, if any court shall determine that the time, geographical area, orscope of activity of any restriction contained in this Section is unenforceable, it isthe intention of the parties that such restrictive covenant set forth herein shall notthereby be terminated but shall be deemed amended to the extent required to render itvalid and enforceable.     (j) The covenants of the Sellers contained in this Section may be assigned by Buyerto any person to whom the business of the Companies is transferred substantially as anentirety, it being the intention of the parties hereto that such covenants shall inure tothe benefit of any successor to the business and assets of the Companies, with the sameforce and effect as if such covenants had been made directly to such successor orsuccessors.          6.10 Owner Marks. From and after the Closing, Buyer shall have a limited right,title, interest, and license to use the word “Laser” or any trademarks containing or comprising theforegoing, or any trademark confusingly similar thereto or dilutive thereof (collectively, the“***Owner Marks***”). From and after the Closing, Buyer agrees that it shall use commercially reasonableefforts to (a) cause the Companies to cease using the Owner Marks in any manner, directly orindirectly, except for such limited uses as cannot be promptly terminated
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(*e.g*., signage, e-mail addresses, and as a referral or pointer to the acquired website), andto cease such limited usage of the Owner Marks as promptly as possible after the Closing and in anyevent within 180 days following the Closing Date, (b) remove, strike over or otherwise obliterateall Owner Marks from all assets and all other materials owned, possessed or used by the Companiesand (c) to cause any third parties using or licensing Owner Marks on behalf of or with the consentof the Sellers, to remove, strike over or otherwise obliterate all Owner Marks from all materialsowned, possessed or used by such third parties.          6.11 Financial Statements. The Sellers shall use commercially reasonable efforts to assistBuyer in preparing financial statements of the Companies in such form and covering such periods asmay be required by any applicable securities Laws to be filed with the SEC by Buyer as a result ofthe transactions contemplated by this Agreement and the acquisition of the Companies by Buyer. Assoon as available, the Sellers shall deliver to Buyer the audited financial statements for the yearended December 31, 2006. The Sellers shall use their commercially reasonable efforts to assistBuyer in obtaining the consent of the independent public accounting firm that prepared such auditedfinancial statements in order to include such audit financial statements in any registrationstatement filed by Buyer.          6.12Representation Letters. Each Seller shall use its commercially reasonable efforts tocause the independent public accountants of the Companies to provide any consent necessary to thefiling of such financial statements with the Securities and Exchange Commission and to provide suchcustomary representation letters as are necessary in connection therewith.          6.13 NASDAQ Listing Agreement. Promptly after the Closing Date, Buyer shall file orcause to be filed an additional listing application with the NASDAQ Stock Market LLC for approvalof listing the Buyer Units on the NASDAQ Global Market upon effective registration of the BuyerUnits with the SEC.
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**ARTICLE VII****TAX MATTERS**          7.1 Character and Treatment of Transaction.      (a) Sale Portion of Transaction. Buyer and the Sellers agree to treat thesale of the Interests as set forth in Section 2.2(a) for U.S. federal income taxpurposes as a sale on the Closing Date of a portion of the Interests, all pursuant toRegulations Section 1.707-3(a) and in accordance with Examples 1 and 6 of RegulationsSection 1.707-5(f).     (b) Contribution Portion of Transaction. Buyer and the Sellers agree to thetreat the contribution of the Interests not sold pursuant to Section 2.2(a) as acontribution by the Sellers to the Buyer in exchange for Buyer Units pursuant toRegulations Section 1.721-1 and the assumption of the Qualified Indebtedness pursuant toRegulations Section 1.707-5(a)(1) subject to the following:     (i) Except as provided in Section 7.1(b)(ii) below, the QualifiedIndebtedness was incurred to acquire or make capital expenditures to property of theCompanies and is intended, and the parties expect it, to qualify as a “qualifiedliability” under Regulations Section 1.707-5(a)(6).     (ii) Of the total $37,000,000 of Qualified Indebtedness, a portion of suchQualified Indebtedness was incurred to acquire, and is allocable for Tax purposesto, the Retained Interests and the Interests sold pursuant to Section2.2(a), and will not qualify as a “qualified liability” under RegulationsSection 1.707-5(a)(6). The Sellers estimate such portion to be $2,506,000 and,prior to Closing, shall advise Buyer in writing of the exact amount of suchQualified Indebtedness that will not qualify as a “qualified liability” underRegulations Section 1.707-5(a)(6).     (iii) Of the remaining $34,494,000 of the Qualified Indebtedness (all of whichis intended, and the Parties expect to qualify as a “qualified liability” under
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Regulations Section 1.707-5(a)(6)), approximately $25,559,000 thereof(the ***“Taxable Qualified Liability”***) will be treated, under Example 6 ofRegulations Section 1.707-5(f), as a taxable transfer of additional consideration toSellers pursuant to a sale of a portion of the Interests, with the remainingapproximately $8,935,000 thereof (the ***“Nontaxable Qualified Liability”***) beingtreated as a non-taxable assumption of that portion of the Qualified Indebtedness inconnection with the contribution of a portion of the Interests by Sellers to theBuyer. Prior to the Closing, the Sellers shall advise the Buyer of the exact amountof both the Taxable Qualified Liability and the Nontaxable Qualified Liability.     (c) Valuations & Allocations. All valuations and Consideration allocationsshall be as set forth in Section 7.1(c) of the Disclosure Schedules hereto,particularly as follows (collectively, the “***Allocation***”):     (i) The Cash Payment shall be deemed to have acquired that portion of theInterests set forth in Section 7.1(c) of the Disclosure Schedules.     (ii) The Consideration described in Section 2.2(b) shall be deemed tohave acquired that portion of the Interests set forth in Section 7.1(c) ofthe Disclosure Schedules.     (iii) A portion of the Qualified Indebtedness shall be treated as currentlytaxable consideration under Example 6 of Regulations Section 1.707-5(f) as set forthon Section 7.1(c) of the Disclosure Schedule.     (d) Allocation Consistency. The Sellers and Buyer shall report thetransactions contemplated hereby on all Tax Returns, including, but not limited to Form8594, for purposes of Code Sections 721 and 751, and for purposes of future allocationsunder Code Section 704(c) in a manner consistent with Section 7.1(c) of thisAgreement and of the Disclosure Schedules hereto. If the Consideration is adjustedpursuant Sections 2.2, 2.3, 2.4 or otherwise, then the Sellers shallprepare such adjustment to Section 7.1(c) of this Agreement and of the DisclosureSchedules which adjustment shall be submitted to Buyer, and the Sellers and Buyer shalluse their best efforts to agree on the final adjustment within 30 days after thedetermination of the adjusted Consideration. Buyer and its Affiliates shall timely andproperly prepare,
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execute, file, and deliver all such documents, forms, and other information as theSellers may reasonably request in preparing any required adjustment to Section7.1(c) of this Agreement and of the Disclosure Schedules. If, contrary to the intentof the parties hereto as expressed in this Section 7.1(d), any Taxing authoritymakes or proposes an allocation different from as set forth in Section 7.1(c) ofthis Agreement and of the Disclosure Schedules hereto determined under this Section7.1(d), the Sellers and Buyer shall cooperate with each other in good faith tocontest such Taxing authority’s allocation (or proposed allocation), provided, however,that, after consultation with the party (or parties) adversely affected by suchallocation (or proposed allocation), the other party (or parties) hereto may file suchprotective claims or Tax Returns as may be reasonably required to protect its (or their)interests.     (e) Tax Treatment of Adjustments to Consideration. For Tax purposes, theparties agree to treat all payments made under Sections 2.2(c), (f) and (g), and Section2.3, or under any indemnity provision contained in this Agreement (including any EscrowDeposit retained by Buyer), or for breaches of representations, warranties, covenants oragreements, as adjustments to the Cash Payment.             7.2 Pre-Closing Restructuring. Prior to Closing, the Companies shall cause thetransfers outlined in Section 7.2 of the Disclosure Schedules to occur (the“***Restructuring***”), including the following:     (a) Transfer of Retained Subsidiaries. Ownership of the RetainedSubsidiaries shall have been transferred from Laser Midstream to Laser Midstream II;     (b) Transfer of Panola Gathering System. Laser Midstream shall havetransferred and conveyed to a Subsidiary of Laser Midstream all the assets and operationsassociated with the Panola Gathering System;     (c) Section 754 Election. The Sellers shall have make or have made aprotective election under Code Section 754 for each Interest sold; and     (d) Neutral Tax Impact. All the transfers outlined in Section 7.2 ofthe Disclosure Schedules shall be effected in a manner which does not result in anegative Tax impact on any Company or Buyer.
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             7.3 Post-Closing Tax Covenants. The Sellers and Buyer agree to the followingpost-Closing covenants:     (a) Buyer covenants that for until the earlier of (i) the first anniversary of theClosing Date, or (ii) the date that all of the Buyer Units transferred pursuant toSection 2.2(b) have been sold in a transaction resulting in a basis adjustmentunder Code Section 743 for the benefit of the transferee, that Buyer and its affiliateswill not dispose of any material asset or assets contributed to Buyer pursuant toSection 2.2(b) if any such disposition or series of dispositions would accelerateor increase income or other positive adjustments with respect to the Buyer Unitstransferred to the Sellers pursuant to Section 2.2(b) provided, however, nothingin the Section 7.3(a) shall prevent or prohibit an acquisition of or merger withBuyer or a sale of all or substantially all of the assets of Buyer and its subsidiaries;and     (b) The Sellers and Buyer agree, for the avoidance of doubt, that any accumulateddepreciation attributable to the Interests contributed in exchange for Buyer Unitspursuant to Section 2.2(b) will not be duplicated in computing any amounts underCode Section 751(c) and 751(d).             7.4 Responsibility for Filing Tax Returns and Paying Taxes. The Sellers shall fileall Tax Returns required to be filed by or with respect to each Company for a Pre-Closing TaxPeriod. For the avoidance of doubt, the Sellers shall cause to be prepared and timely filed thefinal federal income Tax Return for Laser Midstream and the other Companies on IRS Form 1065 forthe period that ends on the Closing Date. The Sellers shall pay all Taxes owed with respect to aPre-Closing Tax Period with respect to Laser Midstream and each of the other Companies to theextent such Taxes are not taken into account in the calculation of Estimated Closing Date WorkingCapital. Except as provided in the following sentence, Buyer shall file all other Tax Returnsrequired to be filed by or with respect to Laser Midstream and each of the other Companies andshall pay all other Taxes owed with respect to Laser Midstream and each of the other Companies orany of their assets. Liability for Taxes for any Tax period that includes but does not end on theClosing Date (a “***Straddle Period***”) shall be apportioned between Buyer and the Sellers as follows:(i) property and similar ad valorem Taxes or franchise Taxes based solely on capital shall beapportioned on a ratable daily basis; and (ii) all other Taxes, including income Taxes, shall beapportioned based on an interim closing of the books of Laser Midstream and each of the otherCompanies as of the Closing Date. For this purpose, any franchise Tax
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paid or payable with respect to any Company shall be allocated to the taxable period duringwhich the income, operations, assets or capital comprising the base of such Tax is measured,regardless of whether the right to do business for another taxable period is obtained by thepayment of such Tax. Buyer and the Sellers shall each provide the other with all informationreasonably necessary to prepare a Tax Return. Notwithstanding the foregoing, Sellers shall besolely responsible for all Taxes and Tax Returns with respect to the Retained Subsidiaries.          7.5 Responsibility for Tax Audits and Contests. The Sellers shall control any auditor contest with respect to a Pre-Closing Tax Period and Buyer shall control any other audit orcontest; provided, however, that the Party with the greater potential Tax liability shall controlany audit or contest with respect to a year during which a Straddle Period occurs; providedfurther, that the Party so in control of an audit or contest with respect to a Straddle Periodshall allow the other Party to participate at such other Party’s cost and expense. The Party incontrol of an audit or controversy shall keep the other Party informed of the status of the auditor controversy (including providing copies of correspondence and pleadings). Neither Buyer nor theSellers shall settle any audit or contest in a way that would adversely affect the other Partywithout the other Party’s written consent, which the other Party shall not unreasonably withhold.Buyer and the Sellers shall each provide the other with all information reasonably necessary toconduct an audit or contest with respect to Taxes.          7.6 Tax Refunds. The Sellers shall be entitled to any refund of Taxes paid withrespect to a Pre-Closing Tax Period. Buyer shall be entitled to any refund of Taxes paid withrespect to a Post-Closing Tax Period. Refunds for a Straddle Period shall be apportioned based onthe Taxes that were paid by or on behalf of Buyer and the Sellers. If a Party receives a refund towhich the other Party is entitled, the Party receiving the refund shall pay it to the Partyentitled to the refund within two (2) Business Days after receipt.          7.7 Transfer Taxes. The Sellers shall be jointly responsible for state or localtransfer, sales, use, stamp, registration or other similar Taxes resulting from the transactionscontemplated by this Agreement including, but not limited to, the Restructuring. .          7.8 Disputes over Tax Provisions. The Accountants shall resolve any dispute betweenBuyer and the Sellers over the calculation of Taxes and under this Article VII substantially in themanner described in Section 2.4(a)(iii).
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          7.9 No Limit on Indemnity. This Article VII shall be expressly subject to the limitson indemnity set forth in Article IX hereof.
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**ARTICLE VIII****CONDITIONS TO CLOSING**          8.1 Conditions to Obligations of Buyer. The obligation of Buyer to consummate thetransactions contemplated by this Agreement is subject to the satisfaction of the followingconditions, any one or more of which may be waived in writing by Buyer:     (a) Representations, Warranties and Covenants of Sellers. (i) Each of therepresentations and warranties of the Sellers made in this Agreement will be true andcorrect in all material respects as of the date of this Agreement and as of the Closing(as if made anew at and as of the Closing), except that, to the extent any suchrepresentation or warranty is qualified by materiality or Material Adverse Effect, suchrepresentation or warranty shall be true and correct in all respects, (ii) the Sellersshall have performed or complied in all material respects with all of the covenants andagreements required by this Agreement to be performed or complied with by the Sellers onor before the Closing, and (iii) each Seller shall have delivered to Buyer a certificate,dated the Closing Date, certifying that the conditions specified in this Section8.1(a) have been fulfilled;     (b) Third Party Consents; Governmental Approvals. Except as otherwiseprovided herein, all consents, approvals or waivers, if any, disclosed on any schedule tothis Agreement or otherwise required in connection with the consummation of thetransactions contemplated by this Agreement have been received. All of the consents,approvals, authorizations, exemptions and waivers from Governmental Authorities that willbe required to enable Buyer to consummate the transactions contemplated by this Agreementhave been obtained;     (c) HSR Approval. The waiting period under the HSR Act applicable to theconsummation of the sale and purchase of the Interests contemplated hereby shall haveexpired or been terminated;     (d) No Injunction, Etc. No provision of any applicable Law and no orderwill be in effect that will prohibit or restrict the consummation of the Closing;
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     (e) No Proceedings. No proceeding challenging this Agreement or thetransactions contemplated hereby or seeking to prohibit, alter, prevent or materiallydelay the Closing or seeking Losses from any Company incident to this Agreement or thetransactions contemplated hereby, will have been instituted by any Person before anyGovernmental Authority and be pending;     (f) Resignations of Officers and Directors. Buyer shall have received theresignations (or evidence of removal) of each officer or director of each Companyeffective as of the Closing;     (g) No Material Adverse Change. Since the Balance Sheet Date, there shallnot have been a material adverse change in the business, assets, results of operations,or condition (financial or otherwise) of the Companies taken as a whole;     (h) Legal Opinions. Buyer shall have received an opinion of counsel for theSellers substantially in the form attached hereto as Exhibit D;     (i) Financial Statements. Buyer shall have received (i) audited financialstatements for the year ended December 31, 2006 for the Companies and the RetainedSubsidiaries, and (ii) unaudited pro forma balance sheets as of February 28, 2007, andthe statements of earnings and statements of cash flow as of and for the two months endedFebruary 28, 2007, of the Companies other than the Retained Subsidiaries;     (j) Working Capital. Buyer shall have received the Estimated Closing DateBalance Sheet and the Sellers’ written calculation of the Estimated Working CapitalAdjustment and shall have agreed to such Estimated Working Capital Adjustment, subject tothe terms of Section 2.2(b);     (k) Books and Records. Buyer shall have received all original books andrecords of the Companies and control of all of the assets of the Companies;     (l) Transition Agreement. Laser Midstream II shall have executed anddelivered a Transition Agreement, substantially in the form of Exhibit E hereto pursuantto which Laser Midstream II shall provide for the services described therein for a periodof ninety (90) days after Closing;
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     (m) Restructuring. The Restructuring pursuant to Section 7.2 shallhave been completed;     (n) Escrow Agreement. The Sellers shall have executed and delivered theEscrow Agreement substantially in the form of Exhibit B hereto;     (o) Not a Foreign Person. Each Seller shall deliver to Buyer on or beforethe Closing Date, an affidavit to the effect that such Seller is not a “foreign person”within the meaning of Section 1445 of the Code and the Regulations promulgatedthereunder. If, on or before the Closing Date, Buyer shall not have received suchaffidavits, Buyer may withhold from the Consideration payable at Closing to such Sellersuch sums as are required to be withheld therefrom under Section 1445 of the Code and theRegulations promulgated thereunder;     (p) Non-Competition and Non-Solicitation Agreement. Buyer shall havereceived a fully executed Non-Competition and Non-Solicitation Agreement between theBuyer and I. J. “Chip” Berthelot, II; the terms and conditions of which shall be mutuallyacceptable to the parties thereto;     (q) Selling Unitholder Questionnaire. Each Seller receiving Buyer Units orany immediate transferee of such Seller receiving Buyer Units shall execute and deliverto Buyer a selling unitholder questionnaire in a form and substance reasonablysatisfactory to Buyer and its counsel; and     (r) Miscellaneous. The Sellers shall have delivered such othercertificates, instruments of conveyance, and documents as may be reasonably requested byBuyer and agreed to by the Sellers prior to the Closing Date to carry out the intent andpurposes of this Agreement.             8.2 Conditions to the Obligations of the Sellers. The obligation of the Sellers toconsummate the transactions contemplated by this Agreement is subject to the satisfaction of thefollowing conditions, any one or more of which may be waived in writing by the Sellers:     (a) Representations, Warranties and Covenants of Buyer. (i) Each of therepresentations and warranties of Buyer made in this Agreement will be true and correctin all material respects in all respects as of the date of this Agreement and as of
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the Closing (as if made anew at and as of the Closing), except that, to the extentany such representation or warranty is qualified by materiality or Material AdverseEffect, such representation or warranty shall be true and correct in all respects, (ii)Buyer shall have performed or complied in all material respects with all of the covenantsand agreements required by this Agreement to be performed or complied with by Buyer on orbefore the Closing, and (iii) Buyer shall have delivered to the Sellers a certificate,dated the Closing Date, certifying that the conditions specified in this Section8.2(a) have been fulfilled;     (b) Third Party Consents; Governmental Approvals. All consents, approvalsor waivers, if any, disclosed on any schedule to this Agreement or otherwise required inconnection with the consummation of the transactions contemplated by this Agreement havebeen received. All of the consents, approvals, authorizations, exemptions and waiversfrom Governmental Authorities that will be required to enable the Sellers to consummatethe transactions contemplated by this Agreement have been obtained;     (c) HSR Approval. The waiting period under the HSR Act applicable to theconsummation of the sale and purchase of the Interests contemplated hereby shall haveexpired or been terminated;     (d) No Injunction, Etc. No provision of any applicable Law and no orderwill be in effect that will prohibit or restrict the consummation of the Closing;     (e) No Proceedings. No proceeding challenging this Agreement or thetransactions contemplated hereby or seeking to prohibit, alter, prevent or materiallydelay the Closing or seeking Losses from Buyer incident to this Agreement or thetransactions contemplated hereby, will have been instituted by any Person before anyGovernmental Authority and be pending;     (f) Legal Opinions. The Sellers shall have received an opinion of counselfor Buyer substantially in the form attached hereto as Exhibit F;     (g) Restructuring. The Restructuring pursuant to Section 7.2 shallhave been completed;
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     (h) Assumed Indebtedness. The Sellers shall have received satisfactoryevidence from Comerica Bank, N.A. that the Qualified Indebtedness has been assumed byBuyer;     (i) Escrow Agreement. The Buyer shall have executed and delivered theEscrow Agreement substantially in the form of Exhibit B hereto     (j) Other Deliveries. Buyer shall have delivered such other certificates,instruments, and documents as may be reasonably requested by the Sellers and agreed to byBuyer prior to the Closing Date to carry out the intent and purposes of this Agreement.
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**ARTICLE IX****INDEMNIFICATION**             9.1 Survival. The representations and warranties of the Parties in this Agreementcontained in this Agreement shall survive the Closing until (a) in the case of the representationsand warranties in Section 4.6 (Taxes) and Section 4.11 (Employee Benefit Plans) until theexpiration of the applicable statute of limitations, and (b) all other representations andwarranties for one (1) year after the Closing Date, except for the representations and warrantiescontained in Section 3.4 (Ownership of Interests) and Section 4.3 (Capitalization),which shall remain in full force and effect indefinitely.. All covenants and agreement containedin this Agreement including, without limitation, Article VII (Tax Matters) shall survive until theexpiration of the applicable statute of limitations, and certain covenants with a specifiedexpiration date shall continue in effect as provided therein. Notwithstanding the precedingsentence, any representation or warranty in respect of which indemnity may be sought under thisAgreement will survive the time at which it would otherwise terminate pursuant to the precedingsentence if written notice of the inaccuracy or breach thereof giving rise to such right ofindemnity has been given to the Party against whom such indemnification may be sought prior to suchtime; *provided*that such right of indemnity shall continue to survive and shall remain a basis forindemnification hereunder only until the related claim for indemnification is resolved or disposedof in accordance with the terms hereof.             9.2 Indemnification.     (a) From and after the Closing, the Sellers will jointly and severally indemnify,defend and hold harmless Buyer and its officers, members, directors, employees andAffiliates (the “***Buyer Indemnified Parties***”) against any and all liabilities, damages,losses, costs and expenses (including reasonable attorneys’ and consultants’ fees andexpenses) (“***Losses***”) Buyer shall suffer (any Loss of the Companies after the Closing Dateshall be deemed a Loss suffered by Buyer) as a result of, relating to or arising out (i)of any failure or breach of any representation or warranty made by the Sellers pursuantto Article III or Article IV under this Agreement to be true and correctas of the date hereof and as of the Closing (as if made anew at and as of the Closing);(ii) the breach of any covenant or agreement made or to be performed by the Sellerspursuant to this Agreement; or (iii) the ownership of the
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Retained Subsidiaries. Notwithstanding the foregoing, except for any claimpertaining to transfer Taxes under Section 7.7 or Taxes attributable to aStraddle Period under Section 7.4, any claims arising under Section9.2(a)(i) shall be recoverable exclusively against the Escrow Account, and shall besubject to such other limitations as set forth in Section 9.3 below.     (b) From and after the Closing, Buyer will indemnify, defend and hold harmless theSellers and their officers, members, directors, employees and Affiliates (the “***SellerIndemnified Parties***”) against any and all Losses incurred or suffered as a result of,relating to or arising out of (i) any failure of any representation or warranty made byBuyer in this Agreement to be true and correct as of the Closing (as if made anew at andas of the Closing), (ii) the breach of any covenant or agreement made or to be performedby Buyer pursuant to this Agreement, and (iii) the operation of the business of theCompanies after the Closing Date.     (c) THE INDEMNIFICATION PROVISIONS IN THIS ARTICLE IX SHALL BE ENFORCEABLEREGARDLESS OF WHETHER ANY PERSON (INCLUDING THE PERSON FROM WHOM INDEMNIFICATION ISSOUGHT) ALLEGES OR PROVES THE SOLE, CONCURRENT, CONTRIBUTORY OR COMPARATIVE NEGLIGENCE OFTHE PERSON SEEKING INDEMNIFICATION OR THE SOLE OR CONCURRENT STRICT LIABILITY IMPOSEDUPON THE PERSON SEEKING INDEMNIFICATION.             9.3 Limitations on Liability.     (a) Except as otherwise provided herein, neither a Buyer Indemnified Party nor aSeller Indemnified Party will be entitled to indemnity under Section 9.2(a) orSection 9.2(b) of this Agreement which respect to claims for Losses until theamount for any individual claim for Losses exceeds $25,000 (the “***Individual BasketAmount***”) and the aggregate amount for all such claims exceeds five hundred thousanddollars ($500,000) (the “***Aggregate Basket Amount***”), and thereafter, the Buyer IndemnifiedParties shall only be entitled to indemnity for the amount in excess of the AggregateBasket Amount.     (b) Except as otherwise provided herein, in the event a Buyer Indemnified Party isentitled to indemnity under Section 9.2(a) of this Agreement, any such claim
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may be satisfied solely and exclusively against the Escrow Deposit. Therefore,except as otherwise provided herein, the maximum aggregate liability of the Sellers underSection 9.2(a) of this Agreement shall not exceed the Escrow Deposit, and BuyerIndemnified Parties shall have no further right to indemnity thereunder at such time asall cash or Buyer Units have been disbursed from the Escrow Account. Under nocircumstance shall a Buyer Indemnified Party be entitled to recover an indemnity claimarising under Section 9.2(a) of this Agreement directly against a Seller;provided, however, that with regards to a claim relating to the representations andwarranties contained in Section 3.4, Section 4.3, Section 4.6 orSection 4.11, Buyer’s sole remedy shall be against the Escrow Deposit inaccordance with the provisions of Section 9.6, until such time as the term of the EscrowAgreement expires, in which case, Buyer shall be entitled to pursue all of its rights andremedies against the Sellers with respect thereto.     (c) The amount of any Losses subject to indemnification under this ArticleIX shall be reduced or reimbursed, as the case may be, by any third party insuranceproceeds, third party recoveries less the costs expended for such recoveries. Each Partyshall, and shall cause their respective Indemnified Parties to, use commerciallyreasonable efforts to collect any amounts available under such insurance coverage andfrom such other third party alleged to have responsibility. If a Buyer Indemnified Partyreceives an amount under insurance coverage or from such third party with respect toLosses that were the subject of indemnification under Section 9.2 at any timesubsequent to indemnification provided thereunder, then such Buyer Indemnified Partyshall promptly reimburse the Sellers.             9.4 Procedures. Claims for indemnification under this Agreement shall be asserted andresolved as follows:     (a) If any Person who or which is entitled to seek indemnification under Section9.2 (an “***Indemnified Party***”) receives notice of the assertion or commencement of anyclaim asserted against an Indemnified Party by a third party (“***Third Party Claim***”) inrespect of any matter that is subject to indemnification under Section 9.2, theIndemnified Party shall promptly (i) notify the Party obligated to the Indemnified Partypursuant to Section 9.2 above, (the “***Indemnifying Party***”) of the Third PartyClaim and (ii) transmit to the Indemnifying Party a written notice (“***Claim Notice***”)describing in reasonable detail the nature of the Third Party Claim, a copy of
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all papers served with respect to such claim (if any), the Indemnified Party’s bestestimate of the amount of Losses attributable to the Third Party Claim and the basis ofthe Indemnified Party’s request for indemnification under this Agreement. Failure totimely provide such Claim Notice shall not affect the right of the Indemnified Party’sindemnification hereunder, except to the extent the Indemnifying Party is prejudiced bysuch delay or omission.     (b) The Indemnifying Party shall have the right to defend the Indemnified Partyagainst such Third Party Claim. If the Indemnifying Party notifies the Indemnified Partythat the Indemnifying Party elects to assume the defense of the Third Party Claim (suchelection to be without prejudice to the right of the Indemnified Party to dispute whethersuch claim is an identifiable Loss under this Article IX), then the IndemnifyingParty shall have the right to defend such Third Party Claim with counsel selected by theIndemnifying Party (who shall be reasonably satisfactory to the Indemnified Party), byall appropriate proceedings, to a final conclusion or settlement at the discretion of theIndemnifying Party in accordance with this Section 9.4(b). The IndemnifyingParty shall have full control of such defense and proceedings, including any compromiseor settlement thereof; *provided*that the Indemnifying Party shall not enter into anysettlement agreement without the written consent of the Indemnified Party (which consentshall not be unreasonably withheld, conditioned or delayed); *provided further*, that suchconsent shall not be required if (i) the settlement agreement contains a complete andunconditional general release by the third party asserting the claim to all IndemnifiedParties affected by the claim and (ii) the settlement agreement does not contain anysanction or restriction upon the conduct of any business by the Indemnified Party or itsAffiliates. If requested by the Indemnifying Party, the Indemnified Party agrees, at thesole cost and expense of the Indemnifying Party, to cooperate with the Indemnifying Partyand its counsel in contesting any Third Party Claim which the Indemnifying Party electsto contest, including the making of any related counterclaim against the Person assertingthe Third Party Claim or any cross complaint against any Person. The Indemnified Partymay participate in, but not control, any defense or settlement of any Third Party Claimcontrolled by the Indemnifying Party pursuant to this Section 9.4(b), and theIndemnified Party shall bear its own costs and expenses with respect to suchparticipation.     (c) If the Indemnifying Party does not notify the Indemnified Party that the
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Indemnifying Party elects to defend the Indemnified Party pursuant to Section9.4(b), then the Indemnified Party shall have the right to defend, and be reimbursedfor its reasonable cost and expense (but only if the Indemnified Party is actuallyultimately determined to be entitled to indemnification hereunder) in regard to the ThirdParty Claim with counsel selected by the Indemnified Party (who shall be reasonablysatisfactory to the Indemnifying Party), by all appropriate proceedings, whichproceedings shall be prosecuted diligently by the Indemnified Party. In suchcircumstances, the Indemnified Party shall defend any such Third Party Claim in goodfaith and have full control of such defense and proceedings; *provided*, *however*, that theIndemnified Party may not enter into any compromise or settlement of such Third PartyClaim if indemnification is to be sought hereunder, without the Indemnifying Party’sconsent (which consent shall not be unreasonably withheld, conditioned or delayed). TheIndemnifying Party may participate in, but not control, any defense or settlementcontrolled by the Indemnified Party pursuant to this Section 9.4(c), and theIndemnifying Party shall bear its own costs and expenses with respect to suchparticipation.     (d) Any claim by an Indemnified Party on account of Losses that does not result froma Third Party Claim (a “***Direct Claim***”) will be asserted by giving the Indemnifying Partyreasonably prompt written notice thereof, but in any event not later than thirty (30)days after the Indemnified Party becomes aware of such Direct Claim. Such notice by theIndemnified Party will describe the Direct Claim in reasonable detail, will includecopies of all available material written evidence thereof and will indicate the estimatedamount, if reasonably practicable, of damages that has been or may be sustained by theIndemnified Party. The Indemnifying Party will have a period of twenty (20) days withinwhich to object or accept in writing such Direct Claim. Any such objection is called a“***Notice of Claim Dispute.***” If the Indemnifying Party does not so respond within suchtwenty (20) day period, the Indemnifying Party will be deemed to have rejected suchclaim, in which event the Indemnified Party shall submit the Direct Claim to arbitrationpursuant to the terms of Section 9.5. Copies of each Notice of Claim Disputeshall be sent to Buyer and the Escrow Agent. If Buyer and the Sellers fail to resolveany objection contained in such Notice of Claim Dispute within twenty (20) days after thedate the Notice of Claim Dispute is delivered to Buyer, then, at the request of eitherParty, they shall meet in an attempt to resolve an objection described in such Notice ofClaim Dispute and reach a written agreement
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with respect to such objection (a “***Claim Settlement Agreement***”). If the Sellers andBuyer enter into a Claim Settlement Agreement, the objections contained in such Notice ofClaim Dispute shall be deemed to be as resolved therein. If they are unable to resolvethe objection described in such Notice of Claim Dispute within twenty (20) days afterdelivery to the recipient of such Notice of Claim Dispute, then the Sellers and Buyershall submit the objections contained in such Notice of Claim Dispute to arbitration asdescribed in Section 9.5.          9.5 Arbitration. Any objection contained in a Notice of Claim Dispute not resolved in aClaim Settlement Agreement shall be resolved by submission to arbitration as follows: the Sellersand Buyer shall select a single arbitrator from the American Arbitration Association (“***AAA***”) inHouston, Texas (an “***Arbitrator***”) (or, if they cannot agree upon a selection, the Sellers’Representative and Buyer shall each select an Arbitrator, and the two Arbitrators so selected shallchoose a third Arbitrator who has knowledge of the industry and business of the Companies and whoshall act as the Arbitrator to resolve the dispute). The Arbitrator shall resolve the objectioncontained in the Notice of Claim Dispute pursuant to the Commercial Arbitration Rules of the AAA aspromptly as possible and a decision by the Arbitrator as to the resolution of such objection (the“***Arbitrator’s Decision***”) shall be (absent an agreement of the parties regarding an error that ismanifest) conclusive and binding upon the parties for purposes of this Agreement. The Arbitrator’sDecision shall be (i) in writing and (ii) non-appealable and incontestable by Buyer and the Sellersand each of their respective Affiliates and successors and not subject to collateral attack for anyreason. The fees and costs payable to the AAA shall be paid one-half by Buyer and one-half fromthe Escrow Deposit. Buyer shall pay its own counsel fees and other costs incurred in connectionwith any such dispute, and counsel fees and other costs incurred by the Sellers’ Representative inconnection with any such dispute shall be paid from the Escrow Deposit.          9.6 Escrow Account. At the Closing, the Parties shall enter into the Escrow Agreement insubstantially the form of Exhibit B hereto setting out the rights and obligations of the Partiesand the Escrow Agent with respect to the Escrow Account. Whether included in such agreement, theParties agree that the following provisions of this Section 9.6 shall control with respectto the Escrow Account:     (a) The interest, proceeds and distributions earned each year on the Escrow Depositis herein called the “Escrow Income.” The Parties agree to treat the Escrow Income asincome of Laser Midstream II for U.S. federal income tax purposes.
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Subject to (c) below, Escrow Income shall be distributed to Laser Midstream II on aquarterly basis, within five (5) days of receipt by the Escrow Agent.     (b) The Escrow Deposit shall be paid by the Escrow Agent as follows:     (i) to Buyer, pursuant to Claim Settlement Agreement delivered to the EscrowAgent;     (ii) to Buyer, pursuant to joint written instructions from the Sellers andBuyer to the Escrow Agent relating to the resolution of a Third Party Claimpursuant to Section 9.4;     (iii) to Buyer, pursuant to any other joint written instruction from theSellers and Buyer to the Escrow Agent;     (iv) to Buyer, pursuant to a decision by the Arbitrator regarding a DirectClaim sent to the Escrow Agent pursuant to Section 9.5;     (v) to the Sellers, on the first anniversary of the Closing Date, in an amountequal to the remainder of the Escrow Deposit less any amounts related to an assertedbut pending or unpaid Direct Claim or Third Party Claim.     (c) Fees of the Escrow Agent shall be paid one-half (1/2) by the Sellers andone-half (1/2) by Buyer.     (d) Sellers shall retain the right to vote any Buyer Units which are held in theEscrow Account.     (e) If the Escrow Deposit consists of Buyer Units, payments by the Escrow Agent outof the Escrow Deposit shall be the number of Buyer Units based upon the dollar amount ofthe claim to be paid pursuant to Section 9.6(b) divided by the average of the per unitclosing prices of the Common Units on the NASDAQ Global Market, as reported in the WallStreet Journal, for the five (5) consecutive trading days ending on the trading dayimmediately prior to the day that the Escrow Agent pays such claim.             9.7 Waiver of Consequential Damages.  With respect to any and all Losses for whichindemnification may be available hereunder, each party hereby expressly waives any consequential,indirect and special damages with respect to a claim against the other party
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hereto; provided, however, that this waiver shall not apply to the extent such consequential,indirect or special damages are awarded in a Proceeding brought or asserted by a third partyagainst an Indemnified Party.             9.8 Waiver of Other Representations.     (a) EXCEPT THOSE REPRESENTATIONS AND WARRANTIES CONTAINED IN THIS AGREEMENT OR INANY CERTIFICATE OR WRITTEN STATEMENT FURNISHED, OR TO BE FURNISHED TO BUYER PURSUANT TOTHIS AGREEMENT OR IN CONNECTION WITH THE TRANSACTIONS CONTEMPLATED HEREBY, NONE OF THESELLERS NOR ANY OF THEIR AFFILIATES OR REPRESENTATIVES HAS MADE OR IS MAKING ANYREPRESENTATION OR WARRANTY WHATSOEVER, EXPRESS OR IMPLIED, AT LAW OR IN EQUITY, INRESPECT OF EACH COMPANY ITS BUSINESS OR ANY OF ITS ASSETS, LIABILITIES OR OPERATIONS,INCLUDING WITH RESPECT TO MERCHANTABILITY OR FITNESS FOR ANY PARTICULAR PURPOSE, OR WITHRESPECT TO ANY FINANCIAL PROJECTIONS OR FORECASTS RELATING TO EACH COMPANY, AND ANY SUCHOTHER REPRESENTATION AND WARRANTIES ARE HEREBY DISCLAIMED.     (b) EXCEPT AS OTHERWISE EXPRESSLY PROVIDED HEREIN, THE ASSETS OF EACH COMPANY AREBEING TRANSFERRED THROUGH THE SALE OF THE INTERESTS “AS IS, WHERE IS, WITH ALL FAULTS,”AND THE SELLERS EXPRESSLY DISCLAIM ANY REPRESENTATIONS OR WARRANTIES OF ANY KIND ORNATURE, EXPRESS OR IMPLIED, AS TO THE CONDITION, VALUE OR QUALITY OF EACH COMPANY AND ITSASSETS OR THE PROSPECTS (FINANCIAL OR OTHERWISE), RISKS AND OTHER INCIDENTS OF EACHCOMPANY AND ITS ASSETS.             9.9 Exclusive Remedy and Release. The indemnification and remedies set forth in thisArticle IX shall, from and after the Closing, constitute the sole and exclusive remedies ofthe Parties with respect to any breach of representation or warranty or non-performance, partial ortotal, of any covenant or agreement contained in this Agreement; *provided*that nothing in thisSection 9.9 shall prevent either Party from seeking injunctive or equitable relief inpursuit of its indemnification claims under this Article IX.
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**ARTICLE X****TERMINATION**          10.1 Termination. At any time prior to the Closing, this Agreement may be terminated andthe transactions contemplated hereby abandoned:     (a) by the mutual consent of Buyer and the Sellers as evidenced in writing signed byeach of Buyer and the Sellers;     (b) by Buyer, if there has been a material breach by the Sellers of anyrepresentation, warranty or covenant contained in this Agreement that has prevented thesatisfaction of any condition to the obligations of Buyer at the Closing and, if suchbreach is of a character that it is capable of being cured, such breach has not beencured by the Sellers within thirty (30) days after written notice thereof from Buyer;     (c) by the Sellers, if there has been a material breach by Buyer of anyrepresentation, warranty or covenant contained in this Agreement that has prevented thesatisfaction of any condition to the obligations of the Sellers at the Closing and, ifsuch breach is of a character that it is capable of being cured, such breach has not beencured by Buyer within thirty (30) days after written notice thereof from the Sellers;     (d) by the Sellers if the average of the per unit closing prices of the Common Unitson the NASDAQ Global Market, as reported in the Wall Street Journal, for the five (5)consecutive trading days ending on the trading day prior to the Closing Date is below$18.00, in which case the Sellers may, by written notice to Buyer, notify Buyer that theSellers elect to terminate this Agreement on the date which is five (5) Business Daysafter the date of such notice. If the Sellers make such election and provide the noticeto Buyer as required above, Buyer may elect on or before the expiration of such five (5)Business Day period to pay the balance of the Consideration in cash and , if suchelection is made by Buyer, the Sellers will rescind their election to terminate thisAgreement. and Closing shall then occur on or before May 15, 2007.     (e) by either Buyer or the Sellers if any Governmental Authority having competentjurisdiction has issued a final, non-appealable order, decree, ruling or injunction(other than a temporary restraining order) or taken any other action
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permanently restraining, enjoining or otherwise prohibiting the transactionscontemplated by this Agreement; or     (f) by either Buyer or the Sellers, if the transactions contemplated hereby have notbeen consummated by April 30, 2007, *provided*that neither Buyer nor the Sellers will beentitled to terminate this Agreement pursuant to this Section 10.1(f) if suchPerson’s breach of this Agreement has prevented the consummation of the transactionscontemplated by this Agreement.          10.2 Effect of Termination. If this Agreement is terminated under Section 10.1,all further obligations of the Parties under this Agreement will terminate without furtherliability or obligation of either Party to the other Parties hereunder; *provided, however*, that noParty will be released from liability hereunder if this Agreement is terminated and thetransactions abandoned by reason of (a) failure of such Party to have performed its materialobligations under this Agreement or (b) any material misrepresentation made by such Party of anymatter set forth in this Agreement. Nothing in this Section 10.2 will relieve any Party tothis Agreement of liability for breach of this Agreement occurring prior to any termination, or forbreach of any provision of this Agreement that specifically survives termination hereunder. TheConfidentiality Agreement shall not be affected by a termination of this Agreement.
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**ARTICLE XI****MISCELLANEOUS**          11.1 Notices. All notices and other communications between the Parties shall be in writingand shall be deemed to have been duly given when (i) delivered in person, (ii) five (5) days afterposting in the United States mail having been sent registered or certified mail return receiptrequested or (iii) delivered by telecopy and promptly confirmed by delivery in person or post asaforesaid in each case, with postage prepaid, addressed as follows:If to Buyer, to:Eagle Rock Energy Partners, L.P.