EXHIBIT
10.6


 




 





SERVICES
AGREEMENT


 


AMONG


 


WEG GP LLC


 


WILLIAMS ENERGY PARTNERS L.P.


 


AND


 


WEG ACQUISITIONS, L.P.


 




 




















 


TABLE OF CONTENTS


 


	
  ARTICLE I

  
	
   

  	
   

  
	
  DEFINITIONS

  
	
   

  	
   

  
	
  Section
  1.01

  	
  Definitions

  
	
  Section 1.02

  	
  Construction

  
	
   

  	
   

  
	
  ARTICLE II

  
	
   

  	
   

  
	
  RETENTION
  OF WEG ACQUISITIONS; SCOPE OF SERVICES

  
	
   

  	
   

  
	
  Section 2.01

  	
  Retention of
  WEG Acquisitions

  
	
  Section 2.02

  	
  Scope of Services

  
	
  Section 2.03

  	
  Exclusion of
  Services

  
	
  Section
  2.04

  	
  Performance
  of Services by Affiliates

  
	
  Section
  2.05

  	
  Representations
  and Warranties of WEG Acquisitions

  
	
  Section
  2.06

  	
  Representations
  and Warranties of GP and WEG

  
	
  Section 2.07

  	
  Intellectual
  Property

  
	
   

  	
   

  
	
  ARTICLE
  III

  
	
   

  	
   

  
	
  BOOKS, RECORDS AND
  REPORTING

  
	
   

  	
   

  
	
  Section 3.01

  	
  Books and Records

  
	
  Section
  3.02

  	
  Audits

  
	
  Section
  3.03

  	
  Reports

  
	
   

  	
   

  
	
  ARTICLE IV

  
	
   

  	
   

  
	
  PAYMENT
  AMOUNT

  
	
   

  	
   

  
	
  Section 4.01

  	
  Payment Amount

  
	
  Section 4.02

  	
  Payment of
  Payment Amount

  
	
  Section 4.03

  	
  Disputed Charges

  
	
  Section
  4.04

  	
  Set Off

  
	
  Section 4.05

  	
  WEG
  Acquisition’s Employees

  
	
   

  	
   

  
	
  ARTICLE V

  
	
   

  	
   

  
	
  FORCE
  MAJEURE

  
	
   

  	
   

  
	
  Section 5.01

  	
  Force Majeure

  



 


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  ARTICLE VI

  
	
   

  	
   

  
	
  ASSIGNMENTS AND
  SUBCONTRACTS

  
	
   

  	
   

  
	
  Section
  6.01

  	
  Assignments

  
	
  Section 6.02

  	
  Other Requirements

  
	
   

  	
   

  
	
  ARTICLE
  VII

  
	
   

  	
   

  
	
  DISPUTE RESOLUTION

  
	
   

  	
   

  
	
  Section
  7.01

  	
  Disputes

  
	
  Section
  7.02

  	
  Negotiation
  to Resolve Disputes

  
	
  Section 7.03

  	
  Selection of
  Arbitrator

  
	
  Section 7.04

  	
  Conduct of
  Arbitration

  
	
   

  	
   

  
	
  ARTICLE
  VIII

  
	
   

  	
   

  
	
  TERMINATION

  
	
   

  	
   

  
	
  Section 8.01

  	
  Termination By GP

  
	
  Section
  8.02

  	
  Termination
  by WEG Acquisitions

  
	
  Section 8.03

  	
  Effect of
  Termination

  
	
   

  	
   

  
	
  ARTICLE IX

  
	
   

  	
   

  
	
  GENERAL PROVISIONS

  
	
   

  	
   

  
	
  Section
  9.01

  	
  Notices

  
	
  Section
  9.02

  	
  Entire
  Agreement; Superseding Effect

  
	
  Section 9.03

  	
  Effect of
  Waiver or Consent

  
	
  Section 9.04

  	
  Amendment or
  Restatement

  
	
  Section
  9.05

  	
  Restriction
  on Assignment; Binding Effect

  
	
  Section 9.06

  	
  Governing Law;
  Severability

  
	
  Section 9.07

  	
  Further Assurances

  
	
  Section 9.08

  	
  Directly or
  Indirectly

  
	
  Section 9.09

  	
  Counterparts

  



 


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LIST OF DEFINED TERMS


 


	
  Affiliate

  	
  1

  
	
  Agreement

  	
  1

  
	
  Arbitration Notice

  	
  10

  
	
  Arbitrator

  	
  10

  
	
  Assets

  	
  1

  
	
  Assets,

  	
  1

  
	
  Bankrupt

  	
  1

  
	
  Buyer Entity

  	
  2

  
	
  Change of Control

  	
  2

  
	
  Default Rate

  	
  2

  
	
  Dispute

  	
  10

  
	
  Effective Date

  	
  1

  
	
  Force Majeure

  	
  2

  
	
  G&A Employees

  	
  2

  
	
  General Partner
  Interest

  	
  2

  
	
  Governmental Approval

  	
  2

  
	
  Governmental Authority

  	
  2

  
	
  GP

  	
  1

  
	
  Laws

  	
  3

  
	
  New Services Agreement

  	
  3

  
	
  O&M Employees

  	
  3

  
	
  Omnibus Agreement

  	
  3

  
	
  Original Services
  Agreement

  	
  3

  
	
  Participant

  	
  10

  
	
  Participants

  	
  3

  
	
  Parties

  	
  1

  
	
  Partnership Agreement

  	
  3

  
	
  Payment Amount

  	
  7

  
	
  Person

  	
  3

  
	
  Purchase Agreement

  	
  3

  
	
  Services

  	
  5

  
	
  Transition Services
  Agreement

  	
  3

  
	
  WEG

  	
  1

  
	
  WEG Acquisitions

  	
  1

  



 


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SERVICES AGREEMENT


 


This Services Agreement (this “Agreement”) is entered into as of the 17th
day of June, 2003 (the “Effective Date”),
among Williams Energy Partners L.P., a Delaware limited partnership (“WEG”), WEG GP LLC, a Delaware limited
liability company (“GP”), and WEG
Acquisitions, L.P., a Delaware limited partnership (“WEG Acquisitions”, and collectively with WEG and GP, the “Parties” and each, a “Party”).


 


RECITALS


 


A.                                   WEG
is the owner, directly or indirectly, of interests in certain pipelines and
terminals (the “Assets,” as hereinafter defined);


 


B.                                     GP,
in its capacity as the general partner of WEG, desires to engage WEG
Acquisitions, an Affiliate of GP, on its own behalf and for the benefit of WEG,
to provide the services necessary to operate the Assets in accordance with the
direction of GP; and


 


C.                                     WEG
Acquisitions is willing to undertake such engagement, subject to the terms and
conditions of this Agreement;


 


NOW, THEREFORE, WEG, GP, for itself and in its
capacity as the general partner of WEG, and WEG Acquisitions agree as follows:


 


ARTICLE I


 


DEFINITIONS


 


Section 1.01                                Definitions.  As used in this Agreement, the following
terms have the respective meanings set forth below or set forth in the Sections
referred to below:


 


“Affiliate”
shall mean with respect to any Person, any other Person that directly or
indirectly through one or more intermediaries, controls, is controlled by, or
is under common control with, such specified Person.  For purposes of this definition, “control” when used with respect
to any Person means the power to direct the management and policies of such
Person, directly or indirectly, through the ownership of voting securities, by
contract or otherwise.


 


“Agreement”
is defined in the introductory paragraph.


 


“Assets”
shall mean the assets of Williams Energy Partners L.P., Williams OLP, L.P. and
Williams Pipe Line Company, LLC and any Person controlled by any of them.


 


“Arbitration
Notice” is defined in Section 7.02(c).


 


“Arbitrator”
is defined in Section 7.03(a).


 


“Bankrupt”
with respect to any Person shall mean such Person shall generally be unable to
pay its debts as such debts become due, or shall so admit in writing or shall
make a general assignment for the benefit of creditors; or any proceeding shall
be instituted by or against such


 

















 


Person seeking to adjudicate it a bankrupt or insolvent, or seeking
liquidation, winding up, reorganization, arrangement, adjustment, protection,
relief, or composition of it or its debts under any law relating to bankruptcy,
insolvency or reorganization or relief of debtors, or seeking the entry of an
order for relief or the appointment of a receiver, trustee, or other similar
official for it or for any substantial part of its property and, in the case of
any such proceeding instituted against it (but not instituted by it), shall
remain undismissed or unstayed for a period of 30 days; or such Person shall take
any action to authorize any of the actions set forth above.


 


“Buyer
Entity” shall mean WEG Acquisitions and its subsidiaries,
including GP, WEG and all of the direct and indirect subsidiaries of WEG.


 


“Change
of Control” is defined in the New Omnibus Agreement.


 


“Default
Rate” shall mean an interest rate (which shall in no event be
higher than the rate permitted by applicable law) equal to 300 basis points
over LIBOR.


 


“Dispute”
is defined in Section 7.02(a).


 


“Effective
Date” is defined in the introductory paragraph.


 


“Force
Majeure” shall mean any cause beyond the reasonable control
of a Party, including the following causes (unless they are within such Party’s
reasonable control): acts of God, strikes, lockouts, acts of the public enemy,
wars or warlike action (whether actual or impending), arrests and other
restraints of government (civil or military), blockades, embargoes,
insurrections, riots, epidemics, landslides, lightning, earthquakes, fires,
sabotage, tornadoes, named tropical storms and hurricanes, and floods, civil
disturbances, terrorism, mechanical breakdown of machinery or equipment,
explosions, confiscation or seizure by any government or other public
authority, any order of any court of competent jurisdiction, regulatory agency
or governmental body having jurisdiction.


 


“G&A
Employees” is defined in the Transition Services Agreement.


 


“General
Partner Interest” shall have the meaning set forth in Article
I of the Partnership Agreement.


 


“Governmental
Approval” shall mean any material consent, authorization,
certificate, permit, right of way grant or approval of any Governmental
Authority that is necessary for the construction, ownership and operation of
the Assets in accordance with applicable Laws.


 


“Governmental
Authority” shall mean any court or tribunal in any
jurisdiction or any federal, state, tribal, municipal or local government or
other governmental body, agency, authority, department, commission, board,
bureau, instrumentality, arbitrator or arbitral body or any quasi-governmental
or private body lawfully exercising any regulatory or taxing authority.


 


“GP”
is defined in the introductory paragraph.


 


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“Laws”
shall mean any applicable statute, Environmental Law (as defined in the Purchase
Agreement), common law, rule, regulation, judgment, order, ordinance, writ,
injunction or decree issued or promulgated by any Governmental Authority.


 


“O&M
Employees” is defined in the Transition Services Agreement.


 


“New
Omnibus Agreement” shall mean that New Omnibus Agreement
dated as of June 17, 2003 among WEG Acquisitions, Williams Energy Services,
LLC, The Williams Companies, Inc., and Williams Natural Gas Liquids, Inc., as
amended from time to time.


 


“New
Services Agreement” shall mean that Services Agreement dated
as of June 17, 2003 among Williams Pipeline Services, LLC, Williams Alaska
Pipeline Company, LLC and Williams Pipe Line Company, LLC.


 


“Original
Services Agreement” shall mean that Services Agreement among
Williams GP LLC, Williams Energy Partners L.P., Williams Petroleum Services,
L.L.C. and Williams Energy Services, L.L.C.


 


“Participants”
is defined in Section 7.01.


 


“Parties”
is defined in the introductory paragraph.


 


“Partnership
Agreement” shall mean that Second Amended and Restated
Agreement of Limited Partnership of Williams Energy Partners L.P. dated as of
September 27, 2002, as amended by Amendment Nos. 1 and 2 thereto, each dated as
of November 15, 2002, as may be further amended from time to time.  \


 


“Payment
Amount” is defined in Section 4.01.


 


“Person”
means an individual, corporation, partnership, joint venture, trust, limited
liability company, unincorporated organization or other entity.


 


“Purchase
Agreement” means the Purchase Agreement, dated as of April
18, 2003, as amended on May 5, 2003, by and among Williams Energy Services,
LLC, Williams Natural Gas Liquids, Inc., Williams GP LLC and WEG Acquisitions.


 


“Services”
is defined in Section 2.02.


 


“Transition
Services Agreement” shall mean that Transition Services Agreement,
dated as of June 17, 2003, between The Williams Companies, Inc. and WEG
Acquisitions.


 


“WEG”
is defined in the introductory paragraph.


 


“WEG
Acquisitions” is defined in the introductory paragraph.


 


Other terms defined herein have the meanings so given
them.


 


Section 1.02                                Construction.  Unless the context requires otherwise:  (a) the gender (or lack of gender) of all
words used in this Agreement includes the masculine, feminine, and neuter;


 


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(b) references to
Articles and Sections refer to Articles and Sections of this Agreement; (c)
references to Exhibits refer to the Exhibits attached to this Agreement, each
of which is made a part hereof for all purposes; and (d) references to money
refer to legal currency of the United States of America.


 


ARTICLE II


 


RETENTION OF WEG ACQUISITIONS; SCOPE OF SERVICES


 


Section 2.01                                Retention of WEG Acquisitions.


 


(a)                                  GP,
on its own behalf and for the benefit of WEG, hereby engages WEG Acquisitions
to perform the Services (as defined below) and to provide all employees and any
facilities and equipment not otherwise provided by WEG necessary to perform the
Services.  WEG Acquisitions hereby
accepts such engagement and agrees to perform the Services as directed and in
the manner specified by GP and to provide any facilities and equipment not
otherwise provided by WEG, and to provide all employees necessary to perform
the Services.  Notwithstanding anything
to the contrary in this Agreement, WEG Acquisitions shall in no event be
obligated to perform any Services or provide any facilities or equipment until
the applicable O&M Employees or G&A Employees who perform the
applicable Services have been transferred to a Buyer Entity by The Williams
Companies, Inc. pursuant to the Transition Services Agreement.


 


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Section 2.02                                Scope of Services. 
The “Services” shall
consist of any services necessary to operate the Assets and to conduct the
business associated with the Assets, including, without limitation, those
services described on Exhibit 1 hereto. 
The Services shall be provided as directed and in the manner specified
by the officers of GP, and the scope of the Services shall be provided consistent
with the Services provided under the Original Services Agreement immediately
prior to the date hereof, unless agreed otherwise by GP and WEG
Acquisitions.  WEG Acquisitions hereby
covenants and agrees that the Services will be performed (i) in accordance with
applicable material Governmental Approvals and Laws and (ii) in accordance with
industry standards.


 


Section 2.03                                Exclusion of Services.  At any time, either GP or WEG Acquisitions
may temporarily or permanently exclude any particular service from the scope of
the Services upon 90 days notice to the other Party.  GP may permanently exclude services from the scope of Services
related to Williams Ammonia Pipeline, L.P. upon reasonable notice to WEG
Acquisitions.


 


Section 2.04                                Performance of Services by Affiliates.  The Parties hereby agree that in discharging
its obligations hereunder, WEG Acquisitions may engage any of its Affiliates to
perform the Services (or any part of the Services) on its behalf and that the
performance of the Services (or any part of the Services) by any such Affiliate
shall be treated as if WEG Acquisitions performed such Services itself.  Notwithstanding the foregoing, nothing
contained herein shall relieve WEG Acquisitions of its obligations hereunder.


 


Section 2.05                                Representations and Warranties of WEG Acquisitions.  WEG Acquisitions hereby represents, warrants
and covenants to WEG and to GP that the following statements are true and
correct as of the date hereof:


 


(a)                                  WEG
Acquisitions is duly organized, validly existing, and in good standing under
the laws of the State of Delaware; WEG Acquisitions is duly qualified and in
good standing in the States required in order to perform the Services except
where failure to be so qualified or in good standing could not reasonably be
expected to have a material adverse impact on GP or WEG; and WEG Acquisitions
has full power and authority to execute and deliver this Agreement and to
perform its obligations hereunder;


 


(b)                                 WEG
Acquisitions has duly executed and delivered this Agreement, and this Agreement
constitutes the legal, valid and binding obligation of WEG Acquisitions,
enforceable against it in accordance with its terms (except as may be limited
by bankruptcy, insolvency or similar laws of general application and by the
effect of general principles of equity, regardless of whether considered at law
or in equity); and


 


(c)                                  The
authorization, execution, delivery, and performance of this Agreement by WEG
Acquisitions does not and will not (i) conflict with, or result in a breach,
default or violation of, (A) its certificate of limited partnership or the
Partnership Agreement, (B) any contract or agreement to which it is a party or
is otherwise subject, or (C) any law, order, judgment, decree, writ, injunction
or arbitral award to which it is subject; or (ii) require any consent, approval
or authorization from, filing or registration with, or notice to, any
governmental authority or other Person, unless such requirement has already
been satisfied,


 


5

















 


except, in the case of clause (i)(B) and (i)(C), for
such conflicts, breaches, defaults or violations that would not have a material
adverse effect on WEG Acquisitions or on its ability to perform its obligations
hereunder, and except, in the case of clause (ii), for such consents,
approvals, authorizations, filings, registrations or notice, the failure of
which to obtain or make would not have a material adverse effect on WEG
Acquisitions or on its ability to perform its obligations hereunder.


 


Section 2.06                                Representations and Warranties of GP and WEG.  Each of GP and WEG hereby represents,
warrants and covenants to WEG Acquisitions that the following statements are
true and correct as of the date hereof:


 


(a)                                  Each
of GP and WEG is duly organized, validly existing, and in good standing under
the laws of the jurisdiction of its formation; each of GP and WEG has full
power and authority to execute and deliver this Agreement and to perform its
obligations hereunder;


 


(b)                                 Each
of GP and WEG has duly executed and delivered this Agreement, and this
Agreement constitutes the legal, valid and binding obligation of each such
Person enforceable against it in accordance with its terms (except as may be
limited by bankruptcy, insolvency or similar laws of general application and by
the effect of general principles of equity, regardless of whether considered at
law or in equity);


 


(c)                                  The
authorization, execution, delivery, and performance of this Agreement by each
of GP and WEG does not and will not (i) conflict with, or result in a breach,
default or violation of, (A) the organizational documents of such Person, (B)
any contract or agreement to which such Person is a party or is otherwise
subject, or (C) any law, order, judgment, decree, writ, injunction or arbitral
award to which such Person is subject; or (ii) require any consent, approval or
authorization from, filing or registration with, or notice to, any governmental
authority or other Person, unless such requirement has already been satisfied,
except, in the case of clause (i)(B) and (i)(C), for such conflicts, breaches,
defaults or violations that would not have a material adverse effect on GP or
WEG or on their ability to perform their obligations hereunder, and except, in
the case of clause (ii), for such consents, approvals, authorizations, filings,
registrations or notice, the failure of which to obtain or make would not have
a material adverse effect on GP or WEG or on their ability to perform their
obligations hereunder.


 


Section 2.07                                Intellectual Property.


 


(a)                                  Any
(i) inventions, whether patentable or not, developed or invented, or (ii)
copyrightable material (and the intangible rights of copyright therein)
developed, by WEG Acquisitions, its Affiliates or its or their employees in
connection with the performance of the Services shall be the property of WEG
Acquisitions; provided, however,
that WEG shall be granted an irrevocable, royalty-free, non-exclusive and
non-transferable right and license to use such inventions or material; and
further provided, however, that
WEG shall only be granted such a right and license to the extent such grant
does not conflict with, or result in a breach, default, or violation of a right
or license to use such inventions or material granted to WEG Acquisitions by
any Person other than an Affiliate of WEG Acquisitions.  Notwithstanding the foregoing, WEG
Acquisitions will use all commercially reasonable efforts to grant such right
and license to WEG.


 


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(b)                                 WEG
hereby grants to WEG Acquisitions and its Affiliates an irrevocable,
royalty-free, non-exclusive and non-transferable right and license to use,
during the term of this Agreement, any intellectual property provided by WEG to
WEG Acquisitions or its Affiliates, but only to the extent such use is necessary
for the performance of the Services. 
WEG Acquisitions agrees that it and its Affiliates will utilize such
intellectual property solely in connection with the performance of the
Services.


 


ARTICLE III


 


BOOKS, RECORDS AND REPORTING


 


Section 3.01                                Books and Records.  WEG Acquisitions shall maintain accurate
books and records regarding the performance of the Services and its calculation
of the Payment Amount, and shall maintain such books and records for the period
required by applicable accounting practices or law.


 


Section 3.02                                Audits.  GP shall have the right, upon reasonable notice, and at all
reasonable times during usual business hours, to audit, examine and make copies
of the books and records referred to in Section 3.01.  Such right may be exercised through any agent or employee of GP
designated in writing by it or by an independent public accountant, engineer,
attorney or other agent so designated. 
GP shall bear all costs and expenses incurred in any inspection,
examination or audit.  WEG Acquisitions
shall review and respond in a timely manner to any claims or inquiries made by
the GP regarding matters revealed by any such inspection, examination or audit.


 


Section 3.03                                Reports.  WEG Acquisitions shall prepare and deliver to the GP any reports
provided for in this Agreement and such other reports as the GP may reasonably
request from time to time regarding the performance of the Services.


 


ARTICLE IV


 


PAYMENT
AMOUNT


 


Section 4.01                                Payment Amount.  GP shall pay, or cause WEG to pay, WEG
Acquisitions for the amount of any direct or indirect expenses incurred by WEG
Acquisitions in connection with its or its Affiliates performance of the
Services (the “Payment Amount”),
it being understood and agreed that nothing in this Section 4.01 shall be
deemed to amend or modify the provisions of the New Omnibus Agreement or the
Purchase Agreement.


 


Section 4.02                                Payment of Payment Amount. 
GP shall pay, or cause WEG to pay, to WEG Acquisitions in immediately
available funds, the full Payment Amount due under Section 4.01.


 


Section 4.03                                Disputed Charges.  GP MAY, WITHIN 90 DAYS AFTER RECEIPT OF A
CHARGE FROM WEG ACQUISITIONS, TAKE WRITTEN EXCEPTION TO SUCH CHARGE, ON THE
GROUND THAT THE SAME WAS NOT A REASONABLE COST INCURRED BY WEG ACQUISITIONS OR
ITS AFFILIATES IN CONNECTION WITH THE SERVICES. GP SHALL NEVERTHELESS PAY IN
FULL WHEN DUE THE FULL


 


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PAYMENT AMOUNT OWED TO
WEG ACQUISITIONS. SUCH PAYMENT SHALL NOT BE DEEMED A WAIVER OF THE RIGHT OF GP
TO RECOUP ANY CONTESTED PORTION OF ANY AMOUNT SO PAID. HOWEVER, IF THE AMOUNT
AS TO WHICH SUCH WRITTEN EXCEPTION IS TAKEN, OR ANY PART THEREOF, IS ULTIMATELY
DETERMINED IN ACCORDANCE WITH ARTICLE VII NOT TO BE A REASONABLE COST INCURRED
BY WEG ACQUISITIONS OR ITS AFFILIATES IN CONNECTION WITH ITS PROVIDING THE
SERVICES HEREUNDER, SUCH AMOUNT OR PORTION THEREOF (AS THE CASE MAY BE) SHALL
BE REFUNDED BY WEG ACQUISITIONS TO GP TOGETHER WITH INTEREST THEREON AT THE
DEFAULT RATE DURING THE PERIOD FROM THE DATE OF PAYMENT BY GP TO THE DATE OF
REFUND BY WEG ACQUISITIONS.


 


Section 4.04           Set Off.  In the event that WEG Acquisitions owes GP a
sum certain in an uncontested amount under any other agreement, then any such
amounts shall be aggregated and the GP and WEG Acquisitions shall discharge
their obligations by netting those amounts against any amounts owed by GP to
WEG Acquisitions under this Agreement. 
If GP or WEG Acquisitions owes the other party a greater aggregate
amount, that party shall pay to the other party the difference between the
amounts owed.


 


Section 4.05                                WEG Acquisition’s Employees.  The obligations under Sections 4.01 and 4.02
shall be limited to payment of WEG Acquisitions or its Affiliates for expenses
in connection with its employees engaged in the provision of Services
hereunder, and GP shall not be obligated to pay to WEG Acquisitions’ employees
directly any compensation, salaries, wages, bonuses, benefits, social security
taxes, workers’ compensation insurance, retirement and insurance benefits,
training and other such expenses.


 


ARTICLE V


 


FORCE
MAJEURE


 


Section 5.01                                Force Majeure.  A Party’s obligation under this Agreement
shall be excused when and to the extent its performance of that obligation is
prevented due to Force Majeure; provided,
however, that a Party shall not be excused by Force Majeure from any
obligation to pay money.  The Party that
is prevented from performing its obligation by reason of Force Majeure shall
promptly notify the other Parties of that fact and shall exercise due diligence
to end its inability to perform as promptly as practicable.  Notwithstanding the foregoing, a Party is
not required to settle any strike, lockout or other labor dispute in which it
may be involved; provided, however,
that, in the event of a strike, lockout or other labor dispute affecting WEG
Acquisitions, WEG Acquisitions shall use reasonable efforts to continue to
perform all obligations hereunder by utilizing its management personnel and
that of its Affiliates.


 


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ARTICLE VI


 


ASSIGNMENTS
AND SUBCONTRACTS


 


Section 6.01                                Assignments.


 


(a)                                  Without
the prior consent of WEG Acquisitions, neither WEG nor GP may sell, assign,
transfer or convey any of its rights, or delegate any of its obligations, under
this Agreement to any Person; provided,
however, GP may assign its rights and delegate its obligations under
this Agreement to a transferee of its General Partner Interest pursuant to
Section 4.6(a)(ii)(A) of the Partnership Agreement.


 


(b)                                 Without
the prior consent of GP, WEG Acquisitions may not sell, assign, transfer or
convey any of its rights, or delegate any of its obligations, under this
Agreement to any Person, other than the delegation of performance of Services
to an Affiliate of WEG Acquisitions as permitted by Section 2.04 and the sale,
assignment, transfer or conveyance of its rights hereunder to any such
Affiliate.


 


Section 6.02                                Other Requirements. 
Subject to the other provisions hereof:


 


(a)                                  All
materials and workmanship used or provided in performing the Services shall be
in accordance with applicable drawings, specifications, and standards.


 


(b)                                 WEG
Acquisitions shall exercise reasonable diligence to obtain the most favorable
terms or warranties available from vendors, suppliers and other third parties,
and where appropriate, WEG Acquisitions shall assign such warranties to WEG.


 


(c)                                  In
rendering the Services, WEG Acquisitions shall not discriminate against any
employee or applicant for employment because of race, creed, color, religion,
sex, national origin, age or handicap, and shall comply with all applicable
provisions of Executive Order 11246 of September 24, 1965, and any successor
order thereto.  Subject to the above,
WEG Acquisitions shall, to the extent practicable, engage employees who reside
in or whose businesses are located in the local area or state where the
Services are performed.


 


(d)                                 WEG
Acquisitions covenants and agrees to exercise reasonable diligence to ensure
that, during the term of this Agreement, it shall not employ unauthorized
aliens as defined in the Immigration Reform and Control Act of 1986, or any
successor law.


 


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ARTICLE VII


 


DISPUTE
RESOLUTION


 


Section 7.01                                Disputes.  This Article VII shall apply to any dispute arising under or
related to this Agreement (whether arising in contract, tort or otherwise, and
whether arising at law or in equity), including (a) any dispute regarding the
construction, interpretation, performance, validity or enforceability of any
provision of this Agreement or whether any Person is in compliance with, or
breach of, any provisions of this Agreement, and (b) the applicability of this
Article VII to a particular dispute (collectively, a “Dispute”). The provisions of this Article VII shall be the
exclusive method of resolving Disputes. 
For purposes of this Article, each of WEG Acquisitions and GP, acting
for itself and on behalf of WEG, shall be a “Participant”.


 


Section 7.02                                Negotiation to Resolve Disputes.  If a Dispute arises, the Participants shall
attempt to resolve such Dispute through the following procedure:


 


(a)                                  first,
an executive officer of WEG Acquisitions, and an executive officer of GP shall
promptly meet (whether by phone or in person) in a good faith attempt to
resolve the Dispute;


 


(b)                                 second,
if the Dispute is still unresolved after 20 days following the commencement of
the negotiations described in Section 7.02(a), then the chief executive
officers of WEG Acquisitions and GP will promptly meet (whether by phone or in
person) in a good faith attempt to resolve the Dispute; and


 


(c)                                  third,
if the Dispute is still unresolved after 10 days following the commencement of
the negotiations described in Section 7.02(b), then any Participant may submit
such Dispute to binding arbitration under this Article VII by notifying the
other Participants (an “Arbitration Notice”).


 


Section 7.03                                Selection of Arbitrator.


 


(a)                                  Any
arbitration conducted under this Article VII shall be heard by a sole
arbitrator (the “Arbitrator”)
selected in accordance with this Section 7.03. 
Each Participant and each proposed Arbitrator shall disclose to the
other Participants any business, personal or other relationship or affiliation
that may exist between such Participant and such proposed Arbitrator, and any
Participant may disapprove of such proposed Arbitrator on the basis of such
relationship or affiliation.


 


(b)                                 The
Participant that submits a Dispute to arbitration shall designate a proposed
Arbitrator in its Arbitration Notice. 
If any other Participant objects to such proposed Arbitrator, it may, on
or before the tenth day following delivery of the Arbitration Notice, notify
the other Participants of such objection. 
The Participants shall attempt to agree upon a mutually-acceptable Arbitrator.  If they are unable to do so within 20 days
following delivery of the notice described in the immediately-preceding
sentence, any Participant may request the American Arbitration Association
(“AAA”) to designate the Arbitrator.  If
the Arbitrator so chosen shall die, resign or otherwise fail or becomes unable
to serve as Arbitrator, a replacement Arbitrator shall be chosen in accordance
with this Section 7.03.


 


10

















 


Section 7.04                                Conduct of Arbitration.  The Arbitrator shall expeditiously (and, if
possible, within 90 days after the Arbitrator’s selection) hear and decide all
matters concerning the Dispute.  Except
as the Participants agree otherwise, the arbitration hearing shall be held in
the City of Tulsa, Oklahoma.  Except as
the Participants agree otherwise, the arbitration shall be conducted in
accordance with the then-current Commercial Arbitration Rules of the AAA
(excluding rules governing the payment of arbitration, administrative or other
fees or expenses to the Arbitrator or the AAA), to the extent that such rules
do not conflict with the terms of this Agreement.  Except as expressly provided to the contrary in this Agreement,
the Arbitrator shall have the power (a) to gather such materials, information,
testimony and evidence in the manner as it deems appropriate and relevant to
the dispute before it (and each Participant will provide such materials,
information, testimony and evidence requested by the Arbitrator, except to the
extent any information so requested is proprietary, subject to a third-party
confidentiality restriction or to an attorney-client or other privilege) and
(b) to grant injunctive relief and enforce specific performance.  If it deems necessary, the Arbitrator may
propose to the Participants that one or more other experts be retained to
assist it in resolving the Dispute.  The
retention of such other experts shall require the unanimous consent of the
Participants, which shall not be unreasonably withheld.  Each Participant, the Arbitrator and any
proposed expert shall disclose to each other any business, personal or other
relationship or affiliation that may exist between such Participant (or the
Arbitrator) and such proposed expert; and any Participant may disapprove of
such proposed expert on the basis of such relationship or affiliation.  The decision of the Arbitrator (which shall
be rendered in writing) shall be final, nonappealable and binding upon the
Participants and may be enforced in any court of competent jurisdiction;
provided that the Participants agree that the Arbitrator and any court
enforcing the award of the Arbitrator shall not have the right or authority to
award, special, punitive, exemplary, consequential, indirect or other similar
damages (including without limitation damages on account of lost profits or
opportunities) to any Participant.  The
responsibility for paying the costs and expenses of the arbitration, including
compensation to the Arbitrator and any experts duly retained by the Arbitrator,
shall be allocated between the Participants in a manner determined by the
Arbitrator to be fair and reasonable under the circumstances.  Each Participant shall be responsible for
the fees and expenses of its respective counsel, consultants and witnesses,
unless the Arbitrator determines that compelling reasons exist for allocating
all or a portion of such costs and expenses in another manner.  Any costs or expenses incurred by a
Participant(s) in enforcing any Award of the Arbitrator shall be borne by the
Participant challenging the enforcement.


 


ARTICLE
VIII


 


TERMINATION


 


Section 8.01                                Termination By GP.


 


(a)                                  Upon
the occurrence of any of the following events, GP may terminate this Agreement
by giving written notice of such termination to WEG Acquisitions:


 


(i)                                WEG
Acquisitions becomes Bankrupt;


 


(ii)                             WEG
Acquisitions dissolves and commences liquidation or winding-up; or


 


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(iii)                          there occurs a Change of
Control of GP.


 


Any termination under
this Section 8.01(a) shall become effective immediately upon delivery of the
notice first described in this Section 8.01(a), or such later time (not to
exceed the first anniversary of the delivery of such notice) as may be
specified by GP.


 


(b)                                 In
addition to its rights under Section 8.01(a), GP may terminate this Agreement
at any time by giving notice of such termination to WEG Acquisitions.  Any termination under this Section 8.01(b)
shall become effective 90 days after delivery of such notice, or such later
time (not to exceed the first anniversary of the delivery of such notice) as
may be specified by GP.


 


Section 8.02                                Termination by WEG Acquisitions.


 


(a)                                  WEG
Acquisitions may terminate this Agreement by giving written notice of such
termination to GP upon the occurrence of a Change of Control of GP.


 


Any termination under
this Section 8.02(a) shall become effective immediately upon delivery of the
notice first described in this Section 8.02(a).


 


(b)                                 In
addition to its rights under Section 8.02(a), WEG Acquisitions may terminate
this Agreement at any time by giving notice of such termination to GP. Any
termination under this Section 8.02(b) shall become effective 90 days after
delivery of such notice, or such later time (not to exceed the first
anniversary of the delivery of such notice) as may be specified by WEG Acquisitions; provided however, that for any such
services being provided to Williams Pipeline Company LLC pursuant to the New
Services Agreement no termination will be effective until the obligation to
provide such services to Williams Pipeline Company, LLC also expires or
terminates under the New Services Agreement.


 


Section 8.03                                Effect of Termination. 
If this Agreement is terminated in accordance with Section 8.01 or 8.02,
all rights and obligations under this Agreement shall cease except for (a)
obligations that expressly survive termination of this Agreement; (b)
liabilities and obligations that have accrued prior to such termination,
including the obligation to pay any amounts that have become due and payable
prior to such termination, and (c) the obligation to pay any portion of the
Payment Amount that has accrued prior to such termination, even if such portion
has not become due and payable at that time.


 


ARTICLE IX


 


GENERAL
PROVISIONS


 


Section 9.01                                Notices.  Except as expressly set forth to the contrary in this Agreement,
all notices, requests or consents provided for or permitted to be given under
this Agreement must be in writing and must be delivered to the recipient in
person, by courier or mail or by facsimile, telegram, telex, cablegram or
similar transmission; and a notice, request or consent given under this
Agreement is effective on receipt by the Party to receive it; provided, however, that a facsimile or
other electronic transmission that is transmitted after the normal business
hours of the recipient shall be deemed effective on the next business day.  All notices, requests and 


12

















 


consents to be sent to Williams must be sent to or made at the address
given below for Williams, or such other address as Williams may specify by
notice to WEG and GP.  All notices,
requests and consents to be sent to WEG must be sent to GP.  All notices, requests and consents
(including copies thereof) to be sent to GP must be sent to or made at the
address given below for GP. 


 


	
  Address
  for Notices:

  	
  GP /
  WEG:

  	
  WEG
  Acquisitions:

  
	
   

  	
   

  	
   

  
	
   

  	
  WEG GP LLC

  One Williams Center

  Tulsa, Oklahoma  74172

  Attention:  Mr. Tony Gehres

  Facsimile:  (918) 573-4503

  	
  WEG Acquisitions, L.P.

  c/o WEG GP LLC

  One Williams Center

  Tulsa, Oklahoma 74172

  Attention:  Mr. Lonny Townsend

  Facsimile:  (918) 573-6928

  



 


Section 9.02                                Entire Agreement; Superseding Effect. 
This Agreement constitutes the entire agreement of the Parties relating
to the matters contained herein, superseding all prior contracts or agreements,
whether oral or written, relating to the matters contained herein.


 


Section 9.03                                Effect of Waiver or Consent.  Except as otherwise provided in this Agreement, a waiver or
consent, express or implied, to or of any breach or default by any Party in the
performance by that Party of its obligations under this Agreement is not a
consent or waiver to or of any other breach or default in the performance by
that Party of the same or any other obligations of that Party under this
Agreement.  Except as otherwise provided
in this Agreement, failure on the part of a Party to complain of any act of
another Party or to declare another Party in default under this Agreement,
irrespective of how long that failure continues, does not constitute a waiver
by that Party of its rights with respect to that default until the applicable
statute-of-limitations period has run.


 


Section 9.04                                Amendment or Restatement.  This Agreement may be amended or restated
only by a written instrument executed by each of the Parties.


 


Section 9.05                                Restriction on Assignment; Binding Effect.  This Agreement is binding on and shall inure
to the benefit of the Parties and their respective successors and permitted
assigns.


 


Section 9.06                                Governing Law; Severability.  THIS AGREEMENT IS GOVERNED BY AND SHALL BE
CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK, EXCLUDING ANY CONFLICT-OF-LAWS RULE OR PRINCIPLE THAT
MIGHT REFER THE CONSTRUCTION OR THE INTERPRETATION OF THIS AGREEMENT TO THE LAW
OF ANOTHER JURISDICTION.  If any
provision of this Agreement or the application thereof to any Person or any
circumstance is held invalid or unenforceable to any extent, the remainder of
this Agreement and the application of such provision to other Persons or
circumstances shall not be affected thereby and shall be enforced to the
greatest extent permitted by law.


 


Section 9.07                                Further Assurances. 
In connection with this Agreement and the transactions contemplated
hereby, each Party shall execute and deliver any additional documents


 


13

















 


and instruments and
perform any additional acts that may be reasonably necessary or appropriate to
effectuate and perform the provisions of this Agreement and those transactions.


 


Section 9.08                                Directly or Indirectly. 
Where any provision of this Agreement refers to action to be taken by
any Party, or which such Party is prohibited from taking, such provision shall
be applicable whether such action is taken directly or indirectly by such
Party, including actions taken by or on behalf of any Affiliate of such Party.


 


Section 9.09                                Counterparts.  This Agreement may be executed in counterparts with the same
effect as if each signing party had signed the same document.  All counterparts shall be construed together
and shall constitute one and the same instrument.


 


14

















 


IN WITNESS WHEREOF, the Parties have executed this
Agreement as of the date first set forth above.


 


	
   

  	
  WEG GP LLC

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Don R. Wellendorf

  
	
   

  	
   

  	
  Name:

  	
  Don R. Wellendorf

  
	
   

  	
   

  	
  Title:

  	
  Authorized Signatory

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  WILLIAMS ENERGY
  PARTNERS L.P.

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  WEG GP LLC, its General
  Partner

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
  /s/ Don R. Wellendorf

  
	
   

  	
   

  	
   

  	
  Name:

  	
  Don R. Wellendorf

  
	
   

  	
   

  	
   

  	
  Title:

  	
  Authorized Signatory

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  WEG ACQUISITIONS, L.P.

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  WEG ACQUISITION
  MANAGEMENT LLC,

  its General Partner

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
  /s/ Pierre F. Lapeyre,
  Jr.

  
	
   

  	
   

  	
   

  	
  Name:

  	
  Pierre F. Lapeyre, Jr.

  
	
   

  	
   

  	
   

  	
  Title:

  	
  Authorized Signatory

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
  /s/ Justin S. Huscher

  
	
   

  	
   

  	
   

  	
  Name:

  	
  Justin S. Huscher

  
	
   

  	
   

  	
   

  	
  Title:

  	
  Authorized Signatory