EXHIBIT 10.3


 




 





NEW OMNIBUS AGREEMENT


 


among


 


WEG Acquisitions, L.P.,


 


Williams Energy Services, LLC,


 


Williams Natural Gas Liquids, Inc.


 


and


 


The Williams Companies, Inc.




 





 

















 


NEW OMNIBUS AGREEMENT


 


THIS NEW OMNIBUS AGREEMENT (the “Agreement”)
is entered into on, and effective as of, June 17, 2003 among WEG Acquisitions,
L.P., a Delaware limited partnership (“Buyer”),
Williams Energy Services, LLC, a Delaware limited liability company (“WES”), Williams Natural Gas Liquids, Inc.,
a Delaware corporation (“WNGL”),
and The Williams Companies, Inc., a Delaware corporation (“Williams”, and together with WES and WNGL,
the “Williams Parties”).


 


R E C I T A L S:


 


WHEREAS, Williams,
WES, WNGL, Williams Pipe Line Company, LLC, a Delaware limited liability
company (“WPL”), Williams Energy
Partners, L.P., a Delaware limited partnership (the “MLP”), Williams OLP, L.P., a Delaware limited partnership
(the “OLP”), Williams GP LLC, a
Delaware limited liability company (the “Old
GP”), and Williams Information Technology, Inc. (f/k/a Williams
Information Services Corporation), a Delaware corporation, entered into that
certain Omnibus Agreement, effective as of February 9, 2001, as amended by
the Amendment I thereto, dated January 28, 2002, the Second Amendment thereto,
dated April 11, 2002, and the Third Amendment thereto, dated
September 30, 2002 (as amended, the “Old
Omnibus Agreement”);


 


WHEREAS, Buyer, WES,
WNGL and the Old GP have entered into that certain Purchase Agreement, dated as
of April 18, 2003, as amended by Amendment No. 1 thereto dated as of May 5,
2003 (as amended, the “Purchase Agreement”),
for the purchase and sale of all of the membership interests of WEG GP LLC, a
Delaware limited liability company (“WEG GP
LLC”), all of the common units and subordinated units representing
limited partner interests in the MLP owned by WES and WNGL, and all of the
class B common units representing limited partner interests in the MLP owned by
the Old GP (as contemplated in the Purchase Agreement, the “Transaction”);


 


WHEREAS, the Old
Omnibus Agreement will terminate upon closing of the Transaction (the “Closing” and the date on which the Closing
occurs, the “Closing Date”); and


 


WHEREAS, the parties
hereto specifically intend for each of the entities comprising the Partnership Entities
and the Partnership Group, as applicable, to be third-party beneficiaries with
respect to certain of the rights and benefits herein of the parties hereto.


 


NOW, THEREFORE, in
consideration of the premises and the covenants, conditions, and agreements
contained herein, and for other good and valuable consideration, the receipt
and sufficiency of which are hereby acknowledged, the parties hereto hereby
agree as follows:


 


ARTICLE I

Definitions


 


1.1                               Definitions.


 


(a)                                  Capitalized
terms used herein but not defined shall have the meanings given to them in the
MLP Agreement.


 


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(b)                                 As
used in this Agreement, the following terms shall have the respective meanings
set forth below:


 


“Accounting
Referee” is defined in Section 9.1(a).


 


“Acquisition Date”
means April 11, 2002, the date WES contributed and the MLP acquired all of the
membership interests in WPL.


 


“Affiliate”
of a Person means a Person that directly or indirectly, through one or more
intermediaries, controls, is controlled by, or is under common control with,
the first-mentioned Person.


 


“Applicable Period”
means the period commencing on the Closing Date and terminating on the second
(2nd) anniversary of the Closing Date.


 


“Assignee”
is defined in the MLP Agreement.


 


“Buyer”
is defined in the introduction to this Agreement.


 


“Buyer Entities” means the Buyer and any entity that directly, or indirectly
through one or more intermediaries, is controlled by the Buyer, including WEG
GP LLC (but excluding each entity comprising the Partnership Group).


 


“Buyer Offer” is defined in Section 3.3(a).


 


“Change of Control”
means, with respect to any Person (the “Applicable
Person”), any of the following events:


 


(i)                                     any
sale, lease, exchange or other transfer (in one transaction or a series of
related transactions) of all or substantially all of the Applicable Person’s
assets to any other Person, unless immediately following such sale, lease,
exchange or other transfer such assets are owned, directly or indirectly, by
the Applicable Person;


 


(ii)                                  the
consolidation or merger of the Applicable Person with or into another Person
pursuant to a transaction in which the outstanding Voting Securities of the
Applicable Person are changed into or exchanged for cash, securities or other
property, other than any such transaction where (a) the outstanding Voting
Securities of the Applicable Person are changed into or exchanged for Voting
Securities of the surviving corporation or its parent and (b) the holders of
the Voting Securities of the Applicable Person immediately prior to such
transaction own, directly or indirectly, not less than a majority of the Voting
Securities of the surviving corporation or its parent immediately after such
transaction;


 


(iii)                               a
“person” or “group” (within the meaning of Sections 13(d) or 14(d)(2) of the
Exchange Act) being or becoming the “beneficial owner” (as defined in Rules
13d-3 and 13d-5 under the Exchange Act, except that a person or group shall be
deemed to have “beneficial ownership” of all Voting Securities that such person
or group has the right to acquire, whether such right is exercisable
immediately or only after the 


 


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passage of
time) of more than 50% of all of the then outstanding Voting Securities of the
Applicable Person, except in a merger or consolidation that would not
constitute a Change of Control under clause (ii) above; or


 


(iv)                              solely
with respect to WEG GP LLC, the Continuing Directors of WEG GP LLC cease for
any reason to constitute all of the board of directors of WEG GP LLC then in
office;


 


notwithstanding the foregoing, the events described in clauses (i)
through (iii) of this definition shall not constitute  a Change of Control of WEG GP LLC if the other Person (or “person”
or “group,” in the case of clause (iii)) referred to in such clauses,
immediately prior to such transaction, is an Affiliate of Buyer or WEG GP LLC.


 


“Closing”
is defined in the recitals to this Agreement.


 


“Closing Date”
is defined in the recitals to this Agreement.


 


“Conflicts
Committee” is defined in the MLP Agreement.


 


“Continuing
Directors” means (1) all individuals constituting the board of
directors of WEG GP LLC immediately after the Closing and (2) any new directors
whose nomination for election to the board of directors of WEG GP LLC was
approved by WEG GP LLC  or the board of
directors of WEG GP LLC, or the nominating committee of such board, at a time
that Continuing Directors comprised all of such board of directors.


 


“control”
means the possession, direct or indirect, of the power to direct or cause the
direction of the management and policies of a Person, whether through ownership
of voting securities, by contract or otherwise.


 


“Covered Environmental Losses” is defined in Section 4.1.


 


“Environmental Laws” means all federal, state, and local laws, statutes, rules,
regulations, orders, and ordinances relating to protection of health and the
environment including, without limitation, the federal Comprehensive
Environmental Response, Compensation, and Liability Act, the Superfund
Amendments Reauthorization Act, the Resource Conservation and Recovery Act, the
Clean Air Act, the Federal Water Pollution Control Act, the Toxic Substances
Control Act, the Oil Pollution Act, the Safe Drinking Water Act, the Hazardous
Materials Transportation Act, and other environmental conservation and
protection laws, each as amended through the IPO Date.


 


“Exchange Act” means  the Securities Exchange Act of 1934, as
amended.


 


“G&A
Cap Amount” is defined in Section 7.1(a).


 


“General Partner” means WEG GP LLC and its successors as general partner of the
MLP, unless the context otherwise requires.


 


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“IPO Assets”
is defined in Section 4.1.


 


“IPO Date”
means February 9, 2001, the date of the closing of the initial public offering
of common units representing limited partner interests in the MLP.


 


“Limited
Partner” is defined in the MLP Agreement.


 


“MLP”is defined in the introduction to this Agreement.


 


“MLP Agreement” means  the Second Amended and Restated Agreement
of Limited Partnership of the MLP, dated as of September 27, 2002, as amended
by Amendments Nos. 1 and 2 thereto, each dated as of November 15, 2002, as such
agreement may be further amended or supplemented through the Closing Date, to
which reference is hereby made for all purposes of this Agreement. No amendment
or modification to the MLP Agreement subsequent to the Closing Date shall be
given effect for the purposes of this Agreement unless consented to by each of
the parties to this Agreement.


 


“OLP”
is defined in the introduction to this Agreement.


 


“Old Omnibus
Agreement” is defined in the recitals to this
Agreement.


 


“Partnership
Entities” means the General Partner, the MLP, the OLP,
WPL and any entity controlled by any of the foregoing.


 


“Partnership Group” means the Partnership Entities, with the exclusion of the
General Partner.


 


“Payment
Request” is defined in Section 9.1(a).


 


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


 


“Prospectus” means the MLP’s final prospectus, dated February 5, 2001,
relating to the initial public offering of common units representing limited
partner interests in the MLP, as filed with Securities and Exchange Commission
pursuant to Rule 424(b) under the Securities Act of 1933.


 


“Purchase Agreement”
is defined in the recitals to this Agreement.


 


“Refined Products”
means all grades of motor gasoline, distillate and aviation fuel.


 


“Restricted Assets”
means, (i) with respect to the Williams Entities, for purposes of Article II,
any assets or any business having assets engaged in the activities prohibited
by Section 2.1 and (ii) with respect to the Buyer Entities, for purposes
of Article III, any assets or any business having assets engaged in the
activities prohibited by Section 3.1.


 


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“Services Agreement”
means the Services Agreement, dated the date hereof, among Williams Petroleum
Services, LLC, Williams Alaska Pipeline Company, LLC, and WPL.


 


“Transaction”
is defined in the recitals to this Agreement.


 


“Transition Services
Agreement” means the Transition Services Agreement,
dated the date hereof, between Buyer and Williams.


 


“Upper Cap
Amount” is defined in Section 7.2(c)(i).


 


“Voting Securities” means securities of any class of a Person entitling the holders
thereof to vote on a regular basis in the election of members of the board of
directors or other similar governing body of such Person; provided, however, that in the case of WEG
GP LLC, “Voting Securities” shall refer solely to the membership interests in
WEG GP LLC.


 


“WAP LP”
is defined in Section 5.1.


 


“WEG GP
LLC” is defined in the recitals to this Agreement.


 


“WES”
is defined in the introduction to this Agreement.


 


“Williams”
is defined in the introduction to this Agreement.


 


“Williams
Entities” means Williams and any entity that directly, or indirectly
through one or more intermediaries, controls, is controlled by or is under
common control with Williams, including without limitation, WNGL, WES and the
Old GP.


 


“Williams Offer” is defined in Section 2.3(a).


 


“Williams
Parties” is defined in the recitals to this Agreement.


 


“WNGL”
is defined in the introduction to this Agreement.


 


“WPL” is defined in the recitals to this
Agreement.


 


“WTH LP”
is defined in Section 5.2.


 


“2003
Pre-Closing Stub Period” is defined in Section 7.1(b)(i)(A).


 


“2003
Pre-Closing Cap” is defined in Section 7.1(b)(i)(A).


 


“2003
Post-Closing Stub Period” is defined in Section 7.1(b)(i)(B).


 


“2003
Post-Closing Cap” is defined in Section 7.1(b)(i)(B).


 


“2003
Post-Closing Upper Cap Amount” is defined in Section
7.2(c)(ii)(A).


 


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“2004 Stub
Period” is defined in Section 7.2(c)(iii)(B).


 


“2004 Stub
Period Upper Cap Amount” is defined in Section 7.2(c)(iii)(B).


 


ARTICLE II

Williams Entities’ Business Opportunities


 


2.1                               Williams Entities Restricted Assets.  During the Applicable Period,  the Williams Entities shall be prohibited
from engaging in or acquiring any business having assets engaged in the
following activities:


 


(a)                                  the
transportation, storage or distribution of ammonia or related products in the
United States;


 


(b)                                 the
ownership and operation of facilities for the terminalling and storage of
refined petroleum products in any state in the United States, except Alaska and
Hawaii;


 


(c)                                  Refined
Product transportation (including, without limitation, through joint tariff
arrangements or capacity leases or otherwise) to a delivery point within a
50-mile radius of a Refined Products delivery point owned or supplied by a
Partnership Entity on the Acquisition Date; and


 


(d)                                 Refinery
grade butane transportation from the Koch Pine Bend, MN, refinery, Marathon St.
Paul, MN refinery, ExxonMobil Joilet refinery, BP Whiting, IN refinery and
CITGO Lemont, IL refinery.


 


2.2                               Permitted Exceptions.  Notwithstanding any provision of Section
2.1 to the contrary, any Williams Entity may own and operate Restricted
Assets under the following circumstances:


 


(a)                                  The
Restricted Asset was owned, leased or operated by the Williams Entities on the
Closing Date;


 


(b)                                 The
value of the Restricted Assets acquired after the Closing Date in a transaction
does not exceed $20 million at the time of the acquisition, as determined by
Williams, in its reasonable sole discretion;


 


(c)                                  (i)
The value of the Restricted Assets acquired after the Closing Date in a
transaction exceeds $20 million at the time of acquisition, as determined by
Williams, in its reasonable sole discretion, and (ii) the General Partner has
elected not to cause a member of the Partnership Group to pursue such
opportunity in accordance with the procedures set forth in Section 2.3;
or


 


(d)                                 The
value of the Restricted Assets acquired after the Closing Date in a transaction
represents less than 30% of the consideration paid by Williams or another
Williams Entity in connection with such transaction, as determined by Williams,
in its reasonable sole discretion.


 


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2.3                               Procedures.  In the event that, pursuant to Section 2.2(c), a Williams
Entity acquires Restricted Assets valued or having an original cost in excess
of $20 million at the time of the acquisition, as determined by Williams, in
its reasonable sole discretion, then not later than six (6) months after the
consummation of the acquisition by such Williams Entity of the Restricted
Assets, such Williams Entity shall notify the General Partner of such purchase
and offer the Partnership Group the opportunity to purchase such Restricted
Assets. As soon as practicable, but in any event, within sixty (60) days after
receipt of such notification, the General Partner shall notify the Williams
Entity that either (i) the General Partner has elected not to cause a member of
the Partnership Group to purchase such Restricted Assets, in which event such
Williams Entity shall be forever free to continue to own or operate such
Restricted Assets, or (ii) the General Partner has elected to cause a member of
the Partnership Group to purchase such Restricted Assets, in which event the
following procedures shall be followed:


 


(a)                                  Within
thirty (30) days of receipt of the notice from the General Partner that the
General Partner has elected to cause a member of the Partnership Group to
purchase the Restricted Assets, Williams shall submit an offer to the General
Partner to sell the Restricted Assets (the “Williams
Offer”) to any member of the
Partnership Group selected by the General Partner on the terms and for the
consideration stated in the Williams Offer;


 


(b)                                 Williams
and the General Partner shall negotiate after receipt of such Williams Offer by
the General Partner, the terms on which the Restricted Assets will be sold to a
member of the Partnership Group. Williams shall provide all information
concerning the business, operations and finances of such Restricted Assets as
may be reasonably requested by the General Partner.


 


(i)                                     If
Williams and the General Partner agree on such terms within sixty (60) days after
receipt by the General Partner of the Williams Offer, the General Partner shall
cause a member of the Partnership Group to purchase the Restricted Assets on
such terms as soon as commercially practicable after such agreement has been
reached;


 


(ii)                                  If  Williams and the General Partner are unable
to agree on the terms of a sale during the 60-day period after receipt by the
General Partner of the Williams Offer, Williams and the General Partner will
engage an independent investment banking firm with a national reputation to
determine the fair market value of the Restricted Assets. In determining the
fair market value of the Restricted Assets, the investment banking firm will
have access to the proposed sale and purchase values for the Restricted Assets
submitted by Williams and the General Partner, respectively.  Such investment banking firm will determine
the value of the Restricted Assets within thirty (30) days and furnish Williams
and the General Partner its opinion of such value. The fees of the investment
banking firm’s appraisal will be split equally between Williams and the
MLP.  Upon receipt of such opinion, the
General Partner will have the option, but not the obligation to:


 


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(iii)


 


(A)   cause a member of the
Partnership Group to purchase the Restricted Assets in accordance with the
following process:


 


(1)                                  if
the valuation of the investment banking firm is in the range between the
proposed sale/purchase values of Williams and the General Partner, the General
Partner will have the right to cause a member of the Partnership Group to
purchase the Restricted Assets at the valuation submitted by the investment
banking firm;


 


(2)                                  if
the valuation of the investment banking firm is less than the proposed purchase
value submitted by the General Partner, the General Partner will have the right
to cause a member of the Partnership Group to 
purchase the Restricted Assets for the amount submitted by the General
Partner; and


 


(3)                                  if
the valuation of the investment banking firm is greater than the proposed sale
value submitted by Williams, the General Partner will have the right to cause a
member of the Partnership Group to purchase the Restricted Assets for the
amount submitted by Williams; or


 


(B)   decline to purchase such
Restricted Assets, in which event the Williams Entity forever will be free to
continue to own and operate such Restricted Assets.


 


2.4                               Scope of Prohibition.  Williams and any other Williams Entity shall
only be required to offer Restricted Assets to the General Partner for purchase
by a member of the Partnership Group upon the terms and conditions, including
the price to be paid, contained in this Article II.  Except as provided in this Article II,
each Williams Entity shall be free to engage in any business activity
whatsoever, including those that may be in direct competition with Buyer or any
Partnership Entity.


 


ARTICLE III

Buyer Entities’ Business Opportunities


 


3.1                               Buyer Entities Restricted Assets.  During the Applicable Period,  the Buyer Entities shall be prohibited from
engaging in or acquiring any business having assets engaged in the following
activities:


 


(a)                                  the
transportation, storage or distribution of ammonia or related products in the
United States;


 


(b)                                 the
ownership and operation of facilities for the terminalling and storage of
refined petroleum products in any state in the United States, except Alaska and
Hawaii; and


 


(c)                                  Refined
Product transportation (including, without limitation, through joint tariff
arrangements or capacity leases or otherwise) to a delivery point within a
50-mile


 


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radius of a Refined Products delivery point owned or
supplied by a Partnership Entity on the Acquisition Date.


 


3.2                               Permitted Exceptions.  Notwithstanding any provision of Section
3.1 to the contrary, any Buyer Entity may own and operate Restricted Assets
under the following circumstances:


 


(a)                                  The
Restricted Asset was owned, leased or operated by the Buyer Entities on the
Closing Date;


 


(b)                                 The
Restricted Asset is owned, leased or operated by the Buyer Entities on behalf
of the Partnership Group;


 


(c)                                  The
value of the Restricted Assets acquired after the Closing Date in a transaction
does not exceed $20 million at the time of the acquisition, as determined by
Buyer, in its reasonable sole discretion;


 


(d)                                 (i)
The value of the Restricted Assets acquired after the Closing Date in a
transaction exceeds $20 million at the time of acquisition, as determined by
Buyer, in its reasonable sole discretion, and (ii) the General Partner (with
the approval of the Conflicts Committee) has elected not to cause a member of
the Partnership Group to pursue such opportunity in accordance with the
procedures set forth in Section 3.3; or


 


(e)                                  The
value of the Restricted Assets acquired after the Closing Date in a transaction
represents less than 30% of the consideration paid by Buyer or another Buyer
Entity in connection with such transaction, as determined by Buyer, in its
reasonable sole discretion.


 


3.3                               Procedure.  In the event that, pursuant to Section
3.2(d), a Buyer Entity acquires Restricted Assets valued or having an
original cost in excess of $20 million at the time of the acquisition, as
determined by Buyer, in its reasonable sole discretion, then not later than six
(6) months after the consummation of the acquisition by such Buyer Entity of
the Restricted Assets, such Buyer Entity shall notify the General Partner of
such purchase and offer the Partnership Group the opportunity to purchase such
Restricted Assets. As soon as practicable, but in any event, within sixty (60)
days after receipt of such notification, the General Partner shall notify the
Buyer Entity that either (i) the General Partner has elected (with the approval
of the Conflicts Committee) not to cause a member of the Partnership Group to
purchase such Restricted Assets, in which event such Buyer Entity shall be
forever free to continue to own or operate such Restricted Assets, or (ii) the
General Partner (with the approval of the Conflicts Committee) has elected to
cause a member of the Partnership Group to purchase such Restricted Assets, in
which event the following procedures shall be followed:


 


(a)                                  Within
thirty (30) days of receipt of the notice from the General Partner that General
Partner has elected to cause a member of the Partnership Group to purchase the
Restricted Assets, the Buyer Entity shall submit an offer to the General
Partner to sell the Restricted Assets (the “Buyer
Offer”) to any member of the
Partnership Group selected by the General Partner on the terms and for the
consideration stated in the Buyer Offer;


 


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(b)                                 The
Buyer Entity and the General Partner shall negotiate after receipt of such
Buyer Offer by the General Partner, the terms on which the Restricted Assets
will be sold to a member of the Partnership Group. The Buyer Entity shall
provide all information concerning the business, operations and finances of
such Restricted Assets as may be reasonably requested by the General Partner.


 


(i)                                     If
the Buyer Entity and the General Partner agree on such terms within sixty (60)
days after receipt by the General Partner of the Buyer Offer, a member of the
Partnership Group shall purchase the Restricted Assets on such terms as soon as
commercially practicable after such agreement has been reached;


 


(ii)                                  If
the Buyer Entity and the General Partner are unable to agree on the terms of a
sale during the 60-day period after receipt by the General Partner of the Buyer
Offer, the Buyer Entity and the General Partner will engage an independent
investment banking firm with a national reputation to determine the fair market
value of the Restricted Assets. In determining the fair market value of the
Restricted Assets, the investment banking firm will have access to the proposed
sale and purchase values for the Restricted Assets submitted by the Buyer
Entity and the General Partner, respectively. 
Such investment banking firm will determine the value of the Restricted
Assets within thirty (30) days and furnish the Buyer Entity and the General
Partner its opinion of such value. The fees of the investment banking firm’s
appraisal will be split equally between the Buyer Entity and the MLP.  Upon receipt of such opinion, the General
Partner will have the option, but not the obligation to:


 


(iii)


 


(A)   cause a member of the Partnership Group to
purchase the Restricted Assets in accordance with the following process:


 


(1)                                  if
the valuation of the investment banking firm is in the range between the
proposed sale/purchase values of the Buyer Entity and the General Partner, a
member of the Partnership Group will have the right to purchase the Restricted
Assets at the valuation submitted by the investment banking firm;


 


(2)                                  if
the valuation of the investment banking firm is less than the proposed purchase
value submitted by the General Partner, a member of the Partnership Group will
have the right to  purchase the
Restricted Assets for the amount submitted by the General Partner; and


 


(3)                                  if
the valuation of the investment banking firm is greater than the proposed sale
value submitted by the Buyer Entity, a member of the Partnership Group will
have the right to purchase the Restricted Assets for the amount submitted by
the Buyer Entity; or


 


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(B)   decline to purchase such Restricted Assets,
in which event the Buyer Entity forever will be free to continue to own and
operate such Restricted Assets.


 


3.4                               Scope of Prohibition.  Except as provided in this Article III,
each Buyer Entity shall be free to engage in any business activity whatsoever,
including those that may be in direct competition with any member of the
Partnership Group.


 


ARTICLE
IV

Environmental Indemnification


 


4.1                               WES Indemnification for Covered
Environmental Losses. 
Williams and WES, jointly and severally, shall indemnify, defend and
hold harmless the Partnership Entities from and against any Covered
Environmental Losses relating to the assets of the Partnership Entities described
in the Prospectus that arose prior to the IPO Date (the “IPO Assets”) that become known by February
9, 2004 and that exceed all amounts recovered or recoverable by any Partnership
Entity under contractual indemnities from third Persons or under any applicable
insurance policies.  “Covered Environmental Losses” mean those
non-contingent environmental losses, costs, damages and expenses suffered or
incurred by the Partnership Entities arising from correction of violations of,
or performance of remediation required by, Environmental Laws in effect at the
IPO Date due to events and conditions associated with the operation of the IPO
Assets and occurring before the IPO Date.


 


4.2                               Limitations.  Williams and WES shall have no
indemnification obligation under Section 4.1 for claims made after
February 9, 2004.  The aggregate
liability of Williams and WES in respect of all Covered Environmental Losses
under Section 4.1 shall not exceed $13.3 million, representing $15
million less amounts previously
paid by Williams or WES to the Partnership Entities pursuant to
Section 3.1 of the Old Omnibus Agreement.


 


ARTICLE
V

Right-of-Way Indemnification


 


5.1                               WNGL Right-of-Way Indemnification.  Williams and WNGL, jointly and severally,
shall indemnify, defend and hold harmless the Partnership Entities and their
successors or assigns until February 9, 2016 from and against any losses,
costs, damages, expenses and fees suffered or incurred by any of the
Partnership Entities or their successors or assigns as a result of (a) the
failure of Williams Ammonia Pipeline, L.P., a Delaware limited partnership (“WAP LP”),
or its successors or assigns to be the owner of such valid and indefeasible
easement rights in and to the easements and rights of way in which the ammonia
pipeline was located as of the IPO Date and as are necessary to enable WAP LP
and its successors and assigns to continue to own and operate the ammonia
pipeline in the manner that it was owned and operated as of the IPO Date; and
(b) the failure of WAP LP or its successors and assigns to have the consents
and permits necessary to allow such pipeline to cross the roads, waterways,
railroads and other areas upon which the ammonia pipeline was located as of the
IPO Date.


 


5.2                               WES Right-of-Way Indemnification.  Williams and WES, jointly and severally,
shall indemnify, defend and hold harmless, the Partnership Entities and their
successors and


 


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assigns, until February 9,
2016, from and against any losses, costs, damages, expenses and fees suffered
or incurred by any of the Partnership Entities or their successors or assigns
as a result of (a) the failure of Williams Terminals Holdings, L.P. , a
Delaware limited partnership (“WTH LP”),
or its successors and assigns to be the owner of valid and indefeasible
easement rights in and to the easements and rights of way in which the
pipelines that are associated with the marine terminal facilities at Galena
Park, Texas, Corpus Christi, Texas and Marrero, Louisiana were located as of
the IPO Date and that are necessary to enable WTH LP and its successors and
assigns to continue to own and operate the pipelines in all material respects
in the manner that such pipelines were owned and operated prior to the IPO
Date; and (b) the failure of WTH LP or its successors and assigns to have the
consents and permits necessary to allow such pipelines to cross roads,
waterways, railroads and other areas upon which such pipelines were located as
of the IPO Date.


 


ARTICLE
VI

Environmental and Right-of-Way Indemnification Procedures


 


6.1                               (a)                                  Buyer agrees that within a reasonable period of
time after any Partnership Entity becomes aware of facts giving rise to a claim
for indemnification pursuant to Sections 4.1, 5.1 or 5.2,
Buyer will use its reasonable best efforts to cause such Partnership Entity to
provide notice thereof in writing to Williams, specifying the nature of and
specific basis for such claim.


 


(b)                                 Except
as provided in this Section 6.1(b), Williams shall have the right to
control all aspects of the defense of (and any counterclaims with respect to)
any claims brought against the Partnership Entities that are covered by the
indemnification set forth in Sections 4.1, 5.1 or 5.2,
including, without limitation, the selection of counsel, determination of
whether to appeal any decision of any court and the settling of any such matter
or any issues relating thereto; provided, however, that no such settlement
shall be entered into without the consent of the Partnership Entities unless it
includes a full and unconditional release of the Partnership Entities from all
liability with respect to such matter or issues, as the case may be, the sole
relief provided is monetary damages that are paid in full by the Williams
Parties, and there is no admission or statement of fault or culpability on the
part of any Partnership Entity.


 


(c)                                  Buyer
agrees to use its reasonable best efforts to cause the Partnership Entities, at
their own cost and expense, to cooperate fully with Williams with respect to
all aspects of the defense of any claims covered by the indemnification set
forth in Sections 4.1, 5.1 or 5.2, including, without
limitation, the prompt furnishing to Williams of any correspondence or other
notice relating thereto that the Partnership Entities may receive, permitting
the names of the Partnership Entities to be utilized in connection with such
defense, the making available to Williams of any files, records or other
information of the Partnership Entities that Williams reasonably considers
relevant to such defense and the making reasonably available to Williams,
during normal business hours, of any employees of the Partnership Entities; provided,
however, that in connection therewith Williams agrees to use
reasonable best efforts to minimize the impact thereof on the operations of such
Partnership Entities. In no event shall the obligation of Buyer to use its
reasonable best efforts to cause the Partnership Entities to cooperate with
Williams as set forth in the immediately preceding sentence be construed as
imposing upon the Buyer or the Partnership Entities an obligation to hire and
pay for counsel in connection with the defense of any claims covered by the
indemnification set forth in this Article VI, it being agreed


 


12

















 


that the Williams Parties, jointly and severally,
shall pay the fees and expenses of such counsel; provided, further, that Buyer or the Partnership Entities may hire and pay
for separate counsel in connection with any such defense, at the Buyers or the
MLP’s own option, cost and expense, as the case may be; provided, further, that the Williams
Parties, jointly and severally, shall pay the fees and expenses of separate
counsel for the Buyer or the Partnership Entities if (i) the Williams Parties
have agreed to pay such fees and expenses or (ii) counsel for the Williams
Parties reasonably determines that representation of both the Williams Parties,
on the one hand, and the Partnership Entities, on the other hand, by the same
counsel would create a conflict of interest. 
Williams agrees to keep any counsel hired by the Partnership Entities
reasonably informed as to the status of any such defense, but Williams shall
have the right to retain sole control over such defense except as provided
above.


 


(d)                                 In
determining the amount of any loss, cost, damage or expense for which any of
the Partnership Entities are to be indemnified under Sections 4.1, 5.1
or 5.2, the gross amount of the indemnification will be reduced by (i)
any insurance proceeds realized or to be realized by the Partnership Entities,
and such correlative insurance benefit shall be net of any incremental
insurance premium that becomes due and payable by the Partnership Entities as a
result of such claim and (ii) all amounts recovered or recoverable by any
Partnership Entity under contractual indemnities from third Persons as
described in Section 4.1.


 


ARTICLE
VII

General and Administrative Expenses


 


7.1                               G&A
Cap Amount.


 


(a)                                  Subject
to Section 7.2, the amount of general and administrative expenses
reimbursed by the Partnership Group to the Buyer Entities (or, in the case of Section
7.1(b)(i)(A) below, to the Williams Entities) for any MLP fiscal year shall
not exceed the amounts calculated pursuant to Section 7.1(b) (for any
MLP fiscal year, the “G&A Cap Amount”).


 


(b)                                 (i)                                     2003 Fiscal Year.  For the MLP fiscal year ending on December
31, 2003, the G&A Cap Amount shall be calculated as follows:


 


(A)   For the period beginning on January 1, 2003
and ending on the day immediately preceding the Closing Date (the “2003 Pre-Closing Stub Period”), the amount
of general and administrative expenses reimbursed by the Partnership Group to
the Williams Entities shall not exceed $37.9 million times a fraction, (X) the
numerator of which is the number of successive whole months beginning with
January 2003 and ending with the month in which the Closing occurs and (Y) the
denominator of which is twelve (12) (the “2003
Pre-Closing Cap”). To the extent that the Partnership Group
reimbursed the Williams Entities for general and administrative expenses
incurred in 2003 in excess of the 2003 Pre-Closing Cap, the Williams Parties
shall reimburse the MLP for any such excess amounts and shall make such payment
no later than thirty (30) days following the Closing Date.  To the extent that the Williams Entities
paid unreimbursed general and administrative expenses up to the 2003 Pre-


 


13

















 


Closing Cap, Buyer shall
use commercially reasonable efforts to cause the MLP to, make payment to the
appropriate Williams Entity of such unreimbursed amount no later than thirty
(30) days following the Closing Date.


 


(B)   For the period beginning with the Closing
Date and ending on December 31, 2003 (the “2003
Post-Closing Stub Period”), the amount of general and administrative
expenses reimbursed by the Partnership Group to the Buyer Entities shall not
exceed the sum of (1) the product of $37.9 million (as may be adjusted pursuant
to Section 7.1(b)(iii)) times a fraction, (X) the numerator of which is
the number of successive whole months beginning with the month following the
month in which the Closing occurs and ending with December 2003 and (Y) the
denominator of which is twelve (12) (the “2003
Post-Closing Cap”), plus
(2) the amount of general and administrative expenses incurred by or on behalf
of the Partnership Group in excess of the 2003 Post-Closing Upper Cap Amount
less any amounts duly reimbursed by the Williams Parties to the Buyer Entities
pursuant to Section 7.2(c)(iii)(A).


 


(ii)                                  Succeeding Fiscal Years.  For each succeeding MLP fiscal year
beginning with the MLP fiscal year ending December 31, 2004, the G&A Cap
Amount shall be calculated as follows:


 


(A)   The G&A Cap Amount from the preceding
fiscal year (as may be adjusted pursuant to Section 7.1(b)(iii)) shall
be increased by the greater of (A) 7% per year and (B) the percentage increase
in the Consumer Price Index — All Urban Consumers, U.S. City Average, Not
Seasonally Adjusted.


 


(B)   For purposes of calculating the initial
increase in the G&A Cap Amount for the MLP fiscal year ending on December
31, 2004, the G&A Cap Amount for the 2003 fiscal year shall be $37.9
million (as may be adjusted pursuant to Section 7.1(b)(iii) for
acquisitions, construction, capital improvements, replacements or expansions
occurring in 2003).


 


(iii)                               Adjustment for Acquisitions and Other Events.  If, after the Closing Date, the Partnership
Group (A) makes an acquisition, (B) constructs or causes to be constructed any
assets to be owned, leased or operated by any member of the Partnership Group
or (C) makes or causes to be made any capital improvements, replacements or
expansions of any assets owned, leased or operated by any member of the
Partnership Group, the amount of general and administrative expenses reimbursed
by the Partnership Group to the Buyer Entities will be increased by the Buyer’s
good faith reasonable estimate of the additional amount of annual general and
administrative expenses to be incurred by or on behalf of the Partnership Group
with respect to such acquisition, construction, capital improvement,
replacement or expansion.  The pro rata
portion of the additional general and administrative expenses shall be added to
the G&A Cap Amount and the Upper Cap Amount in the year in which such
acquisition, construction, capital 


 


14

















 


improvement, replacement
or expansion occurs for the portion of the year occurring thereafter and the
full amount of such general and administrative expenses shall be added to the
G&A Cap Amount and the Upper Cap Amount thereafter.


 


7.2                               Certain Limitations.  The provisions of Section 7.1 shall
be subject to the following limitations:


 


(a)                                  Expiration
of G&A Cap.  The amount of
general and administrative expenses reimbursed by the Partnership Group to the
Buyer Entities shall not be limited under this Agreement with respect to any
fiscal year ending after December 31, 2010.


 


(b)                                 Certain
Expenses Not Included.  General and
administrative expenses with respect to the following matters shall be excluded
in determining limitations herein on the amount of general and administrative
expenses that are required to be reimbursed by the Partnership Group or the
Williams Parties to the Buyer Entities:


 


(i)                                     expenses
associated with equity-based incentive compensation plans;


 


(ii)                                  general
and administrative expenses incurred by Buyer that are covered under Section
4.15 to the Purchase Agreement, regardless of whether in excess of the Expense
Limit (as defined in Section 4.15 to the Purchase Agreement), it being
understood that to the extent the Williams Parties reimburse Buyer for general
and administrative expenses in excess of the Expense Limit, Buyer shall
promptly pay any such reimbursements to the MLP by wire transfer of immediately
available funds to an account or accounts designated in writing by the MLP; or


 


(iii)                               general
and administrative expenses incurred in connection with providing Services (as
defined by the Services Agreement) under the Services Agreement.


 


(c)                                  Upper
Cap Amount.


 


(i)                                     Notwithstanding
the limitations in Section 7.1 on the Partnership Group’s reimbursement
obligations for general and administrative expenses in excess of the G&A
Cap Amount, the Partnership Group (or in the case of Section 7.2(c)(iii),
the Williams Parties) shall be required to reimburse the Buyer Entities for
general and administrative expenses incurred on behalf of the Partnership Group
in any MLP fiscal year in excess of the Upper Cap Amount as calculated below
(the “Upper Cap Amount”).


 


(ii)                                  The
Upper Cap Amount shall be calculated as follows:


 


(A)   For the 2003 Post-Closing Stub Period, the
Upper Cap Amount shall be equal to the product of $49.3 million (as may be
adjusted pursuant to Section 7.1(b)(iii)) times a fraction, (X) the
numerator of which is the number of successive whole months beginning with the
month following the month in which the Closing occurs and ending with month of


 


15

















 


December 2003 and (Y) the
denominator of which is twelve (12) (the “2003
Post-Closing Upper Cap Amount”).


 


(B)   For each succeeding MLP fiscal year
beginning with the MLP fiscal year ending December 31, 2004, the Upper Cap
Amount shall be calculated as follows:


 


(1)                                  The
Upper Cap Amount from the preceding fiscal year (as may be adjusted pursuant to
Section 7.1(b)(iii)) shall be increased annually by the lesser of (A)
2.5% per year and (B) the percentage increase in the Consumer Price Index — All
Urban Consumers, U.S. City Average, Not Seasonally Adjusted.


 


(2)                                  For
purposes of calculating the initial increase in the Upper Cap Amount for the
MLP fiscal year ending on December 31, 2004, the Upper Cap Amount for the 2003
fiscal year shall be $49.3 million (as may be adjusted pursuant to Section
7.1(b)(iii) for acquisitions, construction, capital improvements,
replacements and expansions occurring in 2003).


 


(iii)                               For
the twelve months immediately following the Closing Date, the Williams Parties
shall be required to reimburse the Buyer Entities for any and all general and
administrative expenses incurred by or on behalf of the Partnership Group in
excess of the Upper Cap Amount, as follows:


 


(A)   If, for the 2003 Post-Closing Stub Period,
the general and administrative expenses incurred by or on behalf of the
Partnership Group are in an amount in excess of 2003 Post-Closing Upper Cap
Amount, the Williams Parties, jointly and severally, shall be required to
reimburse the Buyer Entities in full for the amount of such excess and shall
make such payment no later than thirty (30) days after the last day of the 2003
Post-Closing Stub Period by wire transfer of immediately available funds to an
account or accounts designated in writing by the Buyer Entities.


 


(B)   If, for the period beginning on January 1,
2004 and ending on the last day of the month in which the first anniversary of
the Closing Date occurs (the “2004 Stub
Period”), the general and administrative expenses incurred by or on
behalf of the Partnership Group exceed the Upper Cap Amount for the MLP fiscal
year ended December 31, 2004 multiplied by a fraction, (X) the numerator of
which is the number of successive months beginning with January 2004 and ending
with the month in which the 2004 Stub Period ends and (Y) the denominator of
which is twelve (12) (the “2004 Stub Period Upper Cap Amount”), the Williams
Parties, jointly and severally, shall be required to reimburse the Buyer
Entities in full for the amount of such excess and shall make such payment no
later than thirty (30) days after the last day of the 2004 Stub Period by wire
transfer of immediately available funds to an account or accounts designated in


 


16

















 


writing by the Buyer
Entities.  If Buyer becomes obligated to
pay the 5% premium for transition services pursuant to the final proviso in
Section 4(a) of the Transition Services Agreement, then for purposes of the
immediately preceding sentence, the 2004 Stub Period Upper Cap Amount shall be
increased by the portion of such premium constituting general and
administrative expenses of the Partnership Group attributable to the 2004 Stub
Period.


 


(C)   Buyer shall, and shall cause each of the
other Buyer Entities to, use good faith efforts to minimize the amount of
general and administrative expenses incurred by any of the Buyer Entities and
for which the Williams Parties would be required to reimburse the Buyer
Entities under this Section 7.2(c)(iii).


 


(D)   Notwithstanding any other provision of this
Article VII, the Williams Entities will not have any obligations to
reimburse the Buyer Entities for general and administrative expenses incurred
on behalf of the Partnership Group or otherwise, except as specifically
provided in this Section 7.2(c)(iii).


 


(iv)                              Except
as provided in Section 7.2(c)(iii), the Partnership Group shall be required
to reimburse the Buyer Entities for any and all general and administrative
expenses in excess of the Upper Cap Amount incurred by or on behalf of the
Partnership Group in any MLP fiscal year.


 


7.3                               No Affect on Section 7.4 of the MLP
Agreement.  Nothing in
this Article VII is intended or shall be construed to affect or modify
the terms and conditions of Section 7.4 of the MLP Agreement.


 


ARTICLE
VIII

Capital Expenditures


 


8.1                               Williams Reimbursement of
Partnership Group Maintenance Capital Expenditures.  The Williams Entities will reimburse the
Partnership Group in each of the MLP’s 2003 and 2004 fiscal years for any
reasonable and customary maintenance capital expenditures made by the
Partnership Group, in accordance with past practices, to maintain the assets of
WPL, in either year, in excess of $19 million; provided, that the Williams
Entities shall not be required to reimburse the Partnership Group in excess of
an aggregate amount of $15 million under this Section 8.1.


 


ARTICLE
IX

Miscellaneous


 


9.1                               Payments; Disputed Amounts; Audit
Rights.


 


(a)                                  Except
as otherwise provided herein, any payments to be made by the Williams Entities
to Buyer or the Partnership Entities under this Agreement shall be made by the
Williams Entities within sixty (60) days of receipt of a written request for
such payment from


 


17

















 


Buyer (which request shall contain a description in
reasonable detail of the individual costs and expenses that comprise the
aggregate amount of the payment requested) (a “Payment
Request”). In the event of a good faith dispute as to the amount of
such payment, the applicable Williams Entity shall give written notice of such
dispute on or before the due date with respect to all or any portion of  the Payment Request, with the particulars of
such dispute. Upon receipt of such notice, Buyer shall, or shall use its
reasonable best efforts to cause the Partnership Entities to, furnish to the
applicable Williams Entity additional supporting documentation to reasonably
substantiate the amount of the Payment Request.  Upon delivery of such additional documentation, the applicable
Williams Entity and the Buyer Entities shall cooperate and use their reasonable
best efforts to resolve such dispute. 
If they are unable to resolve their dispute within twenty (20) business
days of the delivery of such additional supporting documentation to the
applicable Williams Entity, then the dispute shall be referred for resolution
by a firm of independent accountants of nationally recognized standing
reasonably satisfactory to each of Buyer and the applicable Williams Entity
(the “Accounting
Referee”), which shall determine the disputed amounts within thirty
(30) days of the referral of such dispute to such Accounting Referee.  The determination of the Accounting Referee
shall not require the applicable Williams Entity to pay more than the amount in
dispute nor require Buyer or any Partnership Entity to return any amount
previously paid by the applicable Williams Entity.  The fees and expenses of the Accounting Referee shall be borne
equally by the applicable Williams Entity, on the one hand, and Buyer or a
member of the Partnership Entities, on the other hand.  The determination of the Accounting Referee
shall be finally binding.  If any
dispute is resolved in favor of Buyer or any Partnership Entity, the applicable
Williams Entity shall make payment to Buyer or the applicable Partnership
Entity within thirty (30) days of resolution of the dispute.  Notwithstanding the foregoing, in no event
shall the Williams Entities be entitled to withhold any amounts other than
those portions of the applicable payment that are in dispute.


 


(b)                                 Williams
shall have the right, at any time within six (6) months after the date of any
payment by Williams to Buyer or the Partnership Entities pursuant to a Payment
Request to audit those books and records of Buyer and/or any Partnership Entity
that incurred costs or expenses attributable to such Payment Request or which
books and records relate thereto, to verify the amount reflected on such
Payment Request.  Any such audit shall
be conducted during normal business hours by Williams or its designated auditor
after ten (10) days prior written notice to Buyer, at Williams’ sole cost and
expense, in the offices of Buyer and the relevant Partnership Entities or such
other location as may be mutually agreed. 
Buyer shall cooperate and shall use its reasonable best efforts to cause
any relevant Partnership Entity to cooperate with and provide reasonable
assistance to Williams and/or its auditor in connection with the performance of
any such audit.  Williams shall assert
any claim for refund of amounts reimbursed to Buyer or the Partnership Entities
under the audited Payment Request within sixty (60) days after the completion
of the audit.  Buyer shall have sixty
(60) days from receipt of Williams’ claim for refund to respond.  If Buyer does not dispute Williams’ refund
claim, Buyer or the applicable Partnership Entity shall pay such refund within
such 60-day period.  Should Buyer
dispute the claim and refuse to pay any refund claim by Williams resulting from
the exercise of Williams’ audit rights, the parties will refer the dispute to
an Accounting Referee in the manner described in Section 9.1(a) above.


 


18

















 


9.2                               Third-Party Beneficiary; Assignment;
Enforcement.


 


(a)                                  Each
of Buyer and the Williams Parties specifically intends that each entity
comprising the Partnership Entities or the Partnership Group, as applicable, shall
be entitled to assert rights and remedies hereunder as third-party
beneficiaries hereto with respect to those provisions of this Agreement
affording a right, benefit or privilege to any such entity.  Notwithstanding anything else in this
Agreement, pursuant to Section 4.25 of the Purchase Agreement, no provision of
this Agreement with respect to which any of the entities comprising the
Partnership Entities or the Partnership Group, as applicable, is a third-party
beneficiary shall be amended, modified, waived or terminated by a party hereto
without the express prior written approval of the MLP, and if the General
Partner, in its capacity as general partner of the MLP, determines in its
reasonable discretion that such an amendment, modification, waiver or
termination is reasonably likely to adversely affect the holders of common
units representing limited partner interests in the MLP, such amendment,
modification, waiver of termination must also be approved by Special Approval
(as such term is defined in the MLP Agreement).


 


(b)                                 No
party shall have the right to assign its rights or obligations under this
Agreement without the consent of the other parties hereto.


 


(c)                                  The
parties hereto agree that irreparable damage would occur if any of the
provisions of this Agreement were not performed in accordance with their
specific terms or were otherwise breached. 
It is accordingly agreed that the parties shall be entitled to an
injunction or injunctions to prevent breaches of this Agreement and to enforce
specifically the terms and provisions hereof, this being in addition to any
other remedy to which they are entitled at law or in equity.  The third-party beneficiaries to whom
certain rights and remedies under this Agreement extend as contemplated under Section
9.2(a) above shall also be entitled to enforce this Agreement in the manner
provided in this Section 9.2(c). 
Notwithstanding anything else in this Agreement, the provisions of this
Agreement are enforceable solely by the parties to this Agreement and the third-party
beneficiaries identified in Section 9.2(a) above, and no Limited Partner
(other than Buyer), Assignee or other Person (other than a permitted assignee
under Section 9.2(b)) may enforce any provision of this Agreement or
compel any party to this Agreement to comply with the terms of this Agreement.


 


9.3                               Choice of Law; Submission to Jurisdiction.  This
Agreement shall be governed and construed in accordance with the internal and
substantive laws of New York, and without regard to any conflicts of laws
concepts that would apply the substantive law of some other jurisdiction. Each
party hereby submits to the jurisdiction of the state and federal courts in the
State of New York and to venue in the Borough of Manhattan in the City of New
York, New York.


 


9.4                               Notice.  All notices or requests or consents provided
for or permitted to be given pursuant to this Agreement must be in writing and
must be given by depositing same in the United States mail, addressed to the
Person to be notified, postpaid, and registered or certified with return
receipt requested or by delivering such notice in person or by telecopier or
telegram to such party. Notice given by personal delivery or mail shall be
effective upon actual receipt. Notice given by telegram or telecopier shall be
effective upon actual receipt if received during the recipient’s normal
business hours, or at the beginning of the recipient’s next business day after
receipt if not received during the recipient’s normal business hours. All
notices to be sent to a party pursuant to this Agreement shall be sent to or
made at the address set forth below such


 


19

















 


party’s signature to this
Agreement, or at such other address as such party may stipulate to the other
parties in the manner provided in this Section 9.4.


 


9.5                               Entire Agreement.  This Agreement, together with the provisions
of the Purchase Agreement relating hereto, represent the entire agreement and
understanding of the parties hereto and thereto with reference to the
transactions set forth herein.  This
Agreement, together with the provisions of the Purchase Agreement relating
hereto, supercede all prior negotiations, discussions, correspondence,
communications, understandings and agreements between the parties relating to
the transactions set forth herein and all prior drafts hereof (including
Exhibit 1.2(a)(iv)(1) to the Purchase Agreement).  No prior drafts hereof and no words or phrases from any such
prior drafts shall be admissible into evidence in any action or suit involving
this Agreement.


 


9.6                               Termination
of Certain Obligations Upon Change of Control


 


(a)                                  Upon
a Change of Control of Williams, the obligations of the Williams Entities under
Article II shall terminate.


 


(b)                                 Upon
a Change of Control of Buyer or WEG GP LLC, the obligations of the Buyer
Entities under Article III shall terminate.


 


(c)                                  Upon
a Change of Control of Buyer or WEG GP LLC, the obligations of the Williams
Parties under Article V shall terminate as of the later to
occur of (A) the date of such Change of Control and (B) the expiration of all
of the obligations of WES pursuant to Sections 10.1(a) (with respect to
breaches of environmental representations, warranties, agreements or
covenants), 10.1(b) and 10.1(c) of that certain Contribution
Agreement dated as of April 11, 2002 by and among WES, the Old GP and the MLP
and the expiration of all of the corresponding obligations of Williams pursuant
to that certain Corporate Guarantee in favor of the General Partner, dated as
of March 14, 2003, of Williams.


 


(d)                                 Upon
a Change of Control of Buyer or WEG GP LLC, Article VII and the
limitations therein on the amount of general and administrative expenses for
which the Partnership Group is required to reimburse the Buyer Entities shall
terminate (including the provisions therein relating to the reimbursement
obligations of the Williams Parties in favor of the Buyer Entities).


 


9.7                               Effect of Waiver or Consent.  No waiver of any provision of this Agreement
shall be effective unless set forth in writing by the party to be bound
thereby.  Except as otherwise expressly
provided therein, no waiver or consent, express or implied, by any party to or
of any breach or default by any Person in the performance by such Person of its
obligations hereunder shall be deemed or construed to be a consent or waiver to
or of any other breach or default in the performance by such Person of the same
or any other obligations of such Person hereunder. Failure on the part of a
party to complain of any act of any Person or to declare any Person in default,
irrespective of how long such failure continues, shall not constitute a waiver
by such party of its rights hereunder until the applicable statute of
limitations period has run.


 


9.8                               Amendment
or Modification.  Subject to the second sentence of Section 9.2(a), this
Agreement may be amended or modified from time to time only by the written
agreement of


 


20

















 


all the
parties hereto. Each such instrument shall be reduced to writing and shall be
designated on its face an “Amendment” or an “Addendum” to this Agreement.


 


9.9                               Counterparts.  This Agreement may be executed in any number
of counterparts with the same effect as if all signatory parties had signed the
same document. All counterparts shall be construed together and shall
constitute one and the same instrument.


 


9.10                        Severability.  If any provision of this
Agreement or the application thereof to any Person or circumstance shall be
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.


 


9.11                        Gender, Parts, Articles and Sections.  Whenever the context requires, the gender of
all words used in this Agreement shall include the masculine, feminine and
neuter, and the number of all words shall include the singular and plural.  Unless otherwise provided, all references to
Article numbers and Section numbers refer to Articles and Sections of this
Agreement.


 


9.12                        Further Assurances.  In connection with this Agreement and all
transactions contemplated by this Agreement, each signatory party hereto agrees
to execute and deliver such additional documents and instruments and to perform
such additional acts as may be necessary or appropriate to effectuate, carry
out and perform all of the terms, provisions and conditions of this Agreement
and all such transactions.


 


9.13                        Withholding or Granting of Consent.  Except as otherwise expressly provided
herein, each party may, with respect to any consent or approval that it is
entitled to grant pursuant to this Agreement, grant or withhold such consent or
approval in its sole and uncontrolled discretion, with or without cause, and
subject to such conditions as it shall deem appropriate.


 


9.14                        U.S. Currency.  All sums and amounts payable to or to be payable pursuant to the
provisions of this Agreement shall be payable in coin or currency of the United
States of America that, at the time of payment, is legal tender for the payment
of public and private debts in the United States of America.


 


9.15                        Laws and Regulation.  Notwithstanding any provision of this Agreement to the contrary, no
party to this Agreement shall be required to take any act, or fail to take any
act, under this Agreement if the effect thereof would be to cause such party to
be in violation of any applicable law, statute, rule or regulation.


 


9.16                        Waiver of Right of First Refusal.  The Williams Parties hereby agree that,
effective as of the date hereof, any and all rights, benefits and privileges of
WES and any other Williams Entity under Section 11.10 of that certain
Contribution Agreement dated as of April 11, 2002 by and among WES, the Old GP
and the MLP are hereby forever terminated in all respects, and WES, WNGL and
Williams hereby waive any and all rights, benefits and privileges of WES and
any other Williams Entity under such section of such agreement.


 


21

















 


IN WITNESS
WHEREOF, the parties have executed this Agreement on, and effective as of, the
date first written above.


 


	
   

  	
  THE BUYER

  
	
   

  	
   

  	
   

  
	
   

  	
  WEG ACQUISITIONS, L.P.

  
	
   

  	
   

  	
   

  
	
   

  	
  By: WEG Acquisition Management, LLC

  
	
   

  	
  its General Partner

  
	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/  Justin S. Huscher

  	
   

  
	
   

  	
   

  	
  Name:    Justin S. Huscher

  
	
   

  	
   

  	
  Title:     Authorized Signatory

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/  Pierre F. Lapeyre, Jr

  	
   

  
	
   

  	
   

  	
  Name:    Pierre F. Lapeyre, Jr.

  
	
   

  	
   

  	
  Title:     Authorized Signatory

  
	
   

  	
   

  	
   

  
	
   

  	
  Address for Notice:

  
	
   

  	
   

  	
   

  
	
   

  	
  One Williams Center

  
	
   

  	
  Tulsa, Oklahoma  74172

  
	
   

  	
  Facsimile: 918-573-6928

  
	
   

  	
  Attention: Mr. Lonny Townsend

  
	
   

  	
   

  	
   

  
	
   

  	
  THE WILLIAMS PARTIES

  
	
   

  	
   

  	
   

  
	
   

  	
  WILLIAMS ENERGY SERVICES, LLC

  
	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/  Phillip D. Wright

  	
   

  
	
   

  	
   

  	
  Name:    Phillip D. Wright

  
	
   

  	
   

  	
  Title:     Authorized Signatory

  
	
   

  	
   

  	
   

  
	
   

  	
  WILLIAMS NATURAL GAS LIQUIDS, INC.

  
	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/  Phillip D. Wright

  	
   

  
	
   

  	
   

  	
  Name:    Phillip D. Wright

  
	
   

  	
   

  	
  Title:     Authorized Signatory

  
						



 


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  THE WILLIAMS COMPANIES, INC.

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/  Phillip D. Wright

  	
   

  
	
   

  	
   

  	
  Name:    Phillip D. Wright

  
	
   

  	
   

  	
  Title:     Authorized Signatory

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  Address for Notice to Each of the Williams Parties:

  
	
   

  	
   

  	
   

  
	
   

  	
  One Williams Center

  
	
   

  	
  Tulsa, Oklahoma  74172

  
	
   

  	
  Facsimile: 918-573-4503

  
	
   

  	
  Attention: Mr. Tony Gehres

  



 


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