EXHIBIT 10.5


 


SERVICES
AGREEMENT


 


THIS
SERVICES AGREEMENT (“Agreement”)
is entered into as of June 17, 2003, among Williams Petroleum Services, LLC,  a Delaware limited liability company (“WPS”),
Williams Alaska Pipeline Company, LLC, a Delaware limited liability company (“WAPC,”
and with WPS, the “Williams Contractors”),
and Williams Pipe Line Company, LLC,
a Delaware limited liability company (“Subcontractor”), sometimes referred
to collectively as “Parties” or
singularly as “Party”.


 


Recitals


 


WHEREAS, WEG
Acquisitions, L.P. (“Buyer”),
Williams Energy Services, LLC (“WES”),
Williams Natural Gas Liquids, Inc. (“WNGL”)
and Williams GP LLC (the “Old GP,”
and together with WES and WNGL, the “Selling
Parties”) have entered into that certain Purchase Agreement, dated
April 18, 2003, as amended by Amendment No. 1 thereto, dated May 5,
2003 (as so amended, the “Purchase Agreement”),
for the purchase and sale of all of (i) the membership interests of WEG GP LLC
(the “General Partner”), the
general partner of the Williams Energy Partners L.P. (the “MLP”), and (ii) the limited partner
interests in the MLP owned by the Selling Parties;


 


WHEREAS, as
contemplated in the Purchase Agreement and the Transition Services Agreement,
dated the date hereof (the “Transition
Services Agreement”), between Buyer and The Williams Companies, Inc.
(“Williams”), certain employees
of affiliates of the Selling Parties will be transferred to Buyer and/or its
designees and some of such employees participate in the operation of the
businesses and assets of the Williams Contractors or otherwise perform services
on behalf of the Williams Contractors;


 


WHEREAS, the
Williams Contractors and Subcontractor desire to enter into this Agreement
whereby, after the transfer of any of such employees, Subcontractor will
provide, or cause Buyer or one or more of the Partnership Entities to provide
and make available, such services.


 


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


 


1.                                       Definitions.


 


“Accounting
Referee” shall have the meaning set forth in Section
6(b).


 


“Buyer” shall have the
meaning set forth in the recitals to this Agreement.


 


“Claim(s)”
shall mean any and all losses, claims, demands, damages, fines, penalties,
injuries, liabilities, suits, obligations to indemnify others, judgments,
expenses or costs (including reasonable attorneys’, consultants’ and experts’
fees and other expenses incurred in the defense of any claim or lawsuit in the
enforcement of the indemnity obligation contained in Section 10).


 


“Closing Date” shall have
the meaning set forth in Section 1.1 of the Purchase Agreement.


 


“CPI” shall mean the
Consumer Price Index for all urban consumers (CPI-U) as published by the Bureau
of Labor Statistics of the Department of Labor, or any successor thereto.


 

















 


“Determination Amount”
shall have the meaning set forth in Section 6(b).


 


“DOT” shall have the
meaning set forth in Section 15.


 


“G&A Employees” shall
have the meaning set forth in the Transition Services Agreement.


 


“General Partner” shall
have the meaning set forth in the recitals to this Agreement.


 


“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.


 


“Interest Rate” shall
have the meaning set forth in Section 6(b).


 


“Law” 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.


 


“Longhorn” shall mean Longhorn Partners Pipeline, L.P., a Delaware
limited partnership.


 


“Longhorn
Construction Agreement” shall mean that certain Contract, dated
October 21, 1997, between Longhorn and WPS (as successor-in-interest to
Williams Pipe Line Company) for the Engineering, Design, Construction and
Start-up of Gulf Coast to El Paso Pipeline System, as amended by the First Amendment
thereto dated August 1, 1999.


 


“Longhorn
Operating Agreement” shall mean that certain Pipeline Operating
Services Agreement, dated October 21, 1997, by and between WPS (as
successor-in-interest to Williams Pipe Line Company) and Longhorn.


 


“Longhorn Pipeline System”
shall mean “System” as defined in the Longhorn Operating Agreement.


 


“MLP” shall have the
meaning set forth in the recitals to this Agreement.


 


“Monthly Invoice” shall
have the meaning set forth in Section 6(a).


 


“New Omnibus Agreement” shall
mean the Omnibus Agreement, dated the date hereof, by and among Buyer,
Williams, WES and WNGL.


 


“O&M Employees” shall
have the meaning set forth in the Transition Services Agreement.


 


“Option Payment” shall
have the meaning set forth in Section 5(a).


 


“Partnership Entities”
shall mean the General Partner, the MLP and all of the subsidiaries of  the MLP.


 


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


 


“Purchase Agreement”
shall have the meaning set forth in the recitals to this Agreement.


 


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“Services” shall have the
meaning set forth in Section 2 of this Agreement.


 


“Subcontractor Indemnified Parties”
shall have the meaning set forth in Section 10(b) of this Agreement.


 


“TAPS” shall mean the
Trans-Alaska Pipeline System.


 


“Transition Services Agreement”
shall have the meaning set forth in the recitals to this Agreement.


 


“Williams” shall have the
meaning set forth in the recitals to this Agreement.


 


“Williams Contractors”
shall have the meaning set forth in the introduction to this Agreement.


 


“Williams Indemnified Parties”
shall have the meaning set forth in Section 10(a) of this Agreement.


 


1A.                             Effectiveness. 
This Agreement shall become effective immediately after Closing (as
defined in Section 1.1 of the Purchase Agreement).


 


2.                                       Services Provided. 
Subject to Section 4 below, Subcontractor shall, or shall cause
Buyer or one or more of the Partnership Entities to, provide the services
described on Exhibit A (each service for which a specific monthly
fee is specified on Exhibit A being a “Service,”
and collectively, the “Services”)
to the Williams Contractor designated thereon (or to an affiliate of such
Williams Contractor designated in writing to Subcontractor), subject to the
terms and conditions of this Agreement. 
Subcontractor shall, or shall cause Buyer or one or more of the
Partnership Entities to, furnish all labor, tools, material, supplies,
equipment and transportation necessary to perform the Services.


 


3.                                       Compensation.  Subject
to Section 4 below, the Williams
Contractors agree to pay Subcontractor, and Subcontractor agrees to accept as
full and complete compensation for the Services performed by Subcontractor
and/or Buyer or any Partnership
Entity designated by Subcontractor, the compensation set forth under the
headings “Monthly Fee” in the attached Exhibit A.  The parties hereto acknowledge and agree
that the amounts set forth under the headings “Portion of Monthly Fee allocable
to G&A Reimbursement” in the attached Exhibit A are included only
for purposes of determining the amounts not subject to the limitations on
reimbursement for general and administrative expenses under Section 7.2(b)(iii)
of the New Omnibus Agreement.


 


4.                                       Transition Period.  The
parties hereto recognize that after the Closing Date, pursuant to the
Transition Services Agreement, affiliates of the Williams Contractors will
retain certain employees and continue to provide certain services to the
Partnership Entities (including Subcontractor).  The obligations of the parties under Sections 2 and 3
shall not become effective until the O&M Employees and/or G&A Employees
necessary to perform the Services have been transferred to Buyer (or the
Partnership Entity(ies) designated by Buyer) as provided under the Transition
Services Agreement.  If the O&M
Employees and the G&A Employees are not transferred at the same time (or if
one or more groups of G&A Employees are not transferred at the same time),
(i) Subcontractor shall have an obligation to perform, or cause to be
performed, only those Services attributable to the O&M and/or G&A
Employees transferred and (ii) the Williams Contractors shall have an obligation
only to pay for the Services attributable to, and performed by, such
transferred employees.  In any such
case, the compensation owed by the Williams Contractors for any of the services
set forth on Schedule A with respect to which a specific fee amount is
provided will be adjusted to reflect only that portion of any such service that
is


 


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provided.  Any disputes with
respect to the amount of such adjusted fee will be resolved pursuant to Section
6(b).


 


5.                                       Longhorn Option.


 


(a)                                  Subject to the conditions contained in this Section
5, Subcontractor shall have the option to have WPS assign its interests in
the Longhorn Operating Agreement to Subcontractor, or the Partnership Entity
designated by Subcontractor, upon payment to WPS of an amount equal to
$27,300,000.00 ( the “Option Payment”);
provided, however, that if any
part of the Management Fee (as defined in the Longhorn Operating Agreement) is
renegotiated prior to exercise of the option provided herein, the Option Payment
shall be the net present value (calculated using a discount rate of 15%) of the
cash flow for the Primary Term (as defined in the Longhorn Operating Agreement)
of the Longhorn Operating Agreement. 
Subcontractor shall exercise the option described in this Section
5(a) by giving written notice to WPS prior to expiration or termination of
the option as described in Section 5(b).


 


(b)                                 Notwithstanding any termination of this
Agreement under Section 12, the term of the option described in Section
5(a) shall expire upon the earlier of either nine (9) months from the
Closing Date or thirty (30) days after the Delivery Date (as defined in the
Longhorn Operating Agreement).  In
addition, the option described in Section 5(a) shall terminate
immediately upon (i) Williams’ election to sell WPS’s equity interest (or any
portion thereof) in the Longhorn Pipeline System, if such sale also requires
WPS to assign its interests in the Longhorn Operating Agreement, or (ii)
Williams’ reasonable determination that the exercise of such option would
prevent Longhorn from completing its current financial restructuring process
(in the case of this clause (ii), this determination may be made by Williams at
any time prior to and within five (5) days after Subcontractor’s delivery of
written notice exercising such option). 
Notwithstanding the foregoing provisions of this Section 5, any
exercise by Subcontractor of the option described in Section 5(a) is
also conditioned upon WPS obtaining consent from Longhorn to assign its interests
in the Longhorn Operating Agreement, which consent WPS will request immediately
upon execution of this Agreement.


 


6.                                       Billing and Payment.


 


(a)                                  On
or before the twentieth (20th) day of each month following the
Closing during the term of this Agreement, Subcontractor shall provide, or
shall cause one or more of the Partnership Entities to provide, to the Williams
Contractors a written invoice (collectively, the “Monthly Invoice”), setting out the total amount of
compensation due for Services performed in the prior month. Items properly invoiced and not
disputed in good faith by the Williams Contractors shall be due and payable
within fifteen (15) days following the date of such Monthly Invoice; provided, that the Williams Contractors
shall give written notice on or before the due date of any Monthly Invoice of
any good faith dispute of all or any portion of such Monthly Invoice, with the
particulars of such dispute, which dispute shall be resolved in the manner
provided in Section 6(b) below.


 


(b)                                 If
there is a dispute regarding the amounts shown as billed to the Williams
Contractors on any Monthly Invoice, (i) Subcontractor
shall furnish or cause to be furnished to the Williams Contractors such
additional supporting documentation to reasonably substantiate the amounts
billed and (ii) the Williams Contractors may withhold payment with respect to
all or any portion of such invoiced amounts that the Williams Contractors
believe in good faith are inaccurate or are otherwise not in accordance with
the terms of this Agreement until resolution in accordance with the procedures
set forth below in this Section 6(b); provided
that the Williams Contractors shall pay any undisputed portion of such amount
in accordance with Section 6(a).


 


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Upon delivery of such additional documentation, the parties shall
cooperate and use their reasonable 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 by Subcontractor,
then the dispute shall be referred for resolution by a firm of independent
accountants of nationally recognized standing (the “Accounting Referee”) to be selected in the following manner:
the Williams Contractors will select three (3) candidates and deliver a written
notice containing the names of such candidates to Subcontractor, and within five (5) days of receiving such notice, Subcontractor will select one of such
three candidates to serve as the Accounting Referee.  The Accounting Referee may not be otherwise engaged by Williams
or Buyer, or their respective affiliates, in connection with the transactions
contemplated under this Agreement or the Purchase Agreement and may not have
performed any material services on behalf of Williams or Buyer, or their
respective affiliates, during the five (5) years immediately preceding the date
of this Agreement.  The Accounting
Referee shall determine the validity of 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 Williams
Contractors to pay more than the amount in dispute nor require Subcontractor to return any amount
previously paid by the Williams Contractors. The determination of the
Accounting Referee shall be finally binding. 
The fees and expenses of the Accounting Referee shall be borne (i) by
the Williams Contractors if the difference between the amount set forth in such
determination by the Accounting Referee (the “Determination
Amount”) and the Williams Contractors’ estimation of what the
invoice amount should have been (which the Williams Contractors shall provide
to the Accounting Referee at such time the dispute is referred to such
Accounting Referee) is greater than the difference between the Determination
Amount and the amount set forth on the Monthly Invoice, (ii) by Subcontractor if the first such
difference is less than the second such difference and (iii) otherwise equally
by the Williams Contractors and Subcontractor;
provided, if any invoice dispute
is resolved in favor of the Williams Contractors, and the Williams Contractors
have paid such amount, Subcontractor
shall offset the amount of any overpayment against future invoices to the
Williams Contractors; or, if there are no additional invoices to be paid, Subcontractor shall refund any amount
owed within fifteen (15) days of resolution of the dispute.  Such offset or refund shall be credited or
paid to the Williams Contractors together with interest at the rate per annum
equal to the rate published as the “prime rate” in The Wall Street Journal for
the first business day of the month in which such invoice is paid, plus 2%, but
in no event at any rate that is greater than the maximum interest rate allowed
by applicable Laws (such rate, the “Interest
Rate”) from the date of overpayment to Subcontractor until the date of such offset or refund. If a
dispute is resolved in favor of Subcontractor,  the Williams Contractors shall pay interest
on the undisputed amount of an invoice from the due date thereof up to and
including the date when such amount and interest thereon are paid in full, at
the Interest Rate.


 


7.                                       Confidentiality
of Information.


 


(a)                                  General.  During the term of this Agreement and for a
period of one (1) year following the termination of this Agreement, neither
Party (as defined below in this Section 7(a)) shall, directly or
indirectly, disclose to any Person any information received, obtained or
created that is not in the public domain or generally known in the industry, in
any form, whether acquired prior to or after the Closing Date, relating to the
business and operations of the other Party. 
Notwithstanding the foregoing, either Party may disclose any information
relating to the business and operations of the other Party (i) if required by
Law or applicable stock exchange rule and, (ii) to such other Persons if, at
the time such information is provided, such Person is already in the possession
of such information. For purposes of this Section 7, each of the
Williams Contractors and their affiliates, on the one hand, and Subcontractor
and its affiliates (including Buyer and the Partnership Entities), on the other
hand, shall be a “Party.”


 


(b)                                 Obligations
upon Termination.  Upon termination
of this Agreement, except as otherwise provided in this Agreement or in the
Purchase Agreement, each Party agrees to turn over to the other


 


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Party or
destroy such confidential information in its possession, but only in accordance
with the instructions of the other Party; provided,
however, that each Party may maintain one archive copy of all of
such confidential information that was generated during the term of this
Agreement in a secure data storage facility.


 


8.                                       Relationships
Among the Parties.  It is the intent
of the parties that with respect to the provision of Services pursuant to this
Agreement, Subcontractor and any
Partnership Entity designated by Subcontractor
are independent contractors, with authority to control, direct and oversee
their performance of the Services, subject to the overall direction and control
of the representatives of the Williams Contractors or Williams.  Nothing in this Agreement shall cause the
relationship between Subcontractor
and the Partnership Entities, on the one hand, and the Williams Contractors, on
the other hand, to be deemed to constitute an agency, partnership or joint
venture. The terms of this Agreement are not intended to constitute a joint
employer for any purpose between any of the parties and their affiliates.  Subcontractor
shall not have, or hold itself out as having, any authority to enter into any
contract or create any obligation or liability on behalf of, in the name of, or
binding upon the Williams Contractors, except as specifically provided in this
Agreement.


 


9.                                       Representations
and Warranties.


 


(a)                                  Representations
and Warranties of Subcontractor.  As
of the date of this Agreement, Subcontractor represents and warrants as follows:


 


(i)                                     Organization.  Subcontractor
is a limited liability company duly organized, validly existing and in good
standing under the laws of the state of Delaware  and has all requisite power and authority to own its properties
and assets and to conduct its business as now conducted.


 


(ii)                                  Validity
of Agreement.  Subcontractor
has the power to enter into this Agreement and to carry out its obligations
hereunder.  The execution and delivery
of this Agreement and the performance of Subcontractor’s obligations hereunder have been duly authorized,
and no other proceedings on the part of Subcontractor
are necessary to authorize such execution, delivery and performance.  This Agreement has been duly executed by Subcontractor and constitutes the
valid and binding obligation of Subcontractor
enforceable against Subcontractor
in accordance with its terms (except to the extent that its enforceability may
be limited by applicable bankruptcy, insolvency, reorganization or other
similar law affecting the enforcement of creditors’ rights generally or by
general equitable principles).


 


(iii)                               No
Conflict or Violation; No Defaults. 
The execution, delivery and performance by Subcontractor of this Agreement does not and will not violate or
conflict with any provision of its organizational documents and does not and
will not violate any applicable provision of Law, or any order, judgment or
decree of any Governmental Authority, nor violate or result in a breach of or
constitute (with due notice or lapse of time or both) a default under any
contract, lease, loan agreement, mortgage, security agreement, trust indenture
or other agreement or instrument to which Subcontractor is a party or by which it is bound or to which
its  properties or assets is subject,
nor result in the creation or imposition of any encumbrance upon any of its
properties or assets where such violations, breaches or defaults in the
aggregate would have a material adverse effect on the transactions contemplated
hereby or on the assets, properties, business, operations, net income or
financial condition of Subcontractor.


 


(b)                                 Representations
and Warranties of the Williams Contractors.  As of the date of this Agreement, each of the Williams
Contractors represents and warrants as follows:


 


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(i)                                     Corporate
Organization.  Each of the Williams
Contractors is a limited liability company duly organized, validly existing and
in good standing under the laws of the state of Delaware; and each of the
Williams Contractors has all requisite power and authority to own its
properties and assets and to conduct its business as now conducted.


 


(ii)                                  Validity
of Agreement.   Each of the Williams Contractors has the
power to enter into this Agreement and to carry out its obligations hereunder.  The execution and delivery of this Agreement
by each of the Williams Contractors and the performance of their obligations
hereunder has been duly authorized by the Williams Contractors and no other
proceedings on the part of any of the Williams Contractors are necessary to
authorize such execution, delivery and performance.  This Agreement has been duly executed by each of the Williams
Contractors and constitutes the valid and binding obligation of each Williams
Contractor enforceable in accordance with its terms against each Williams
Contractor (except to the extent that its enforceability may be limited by
applicable bankruptcy, insolvency, reorganization or other similar law
affecting the enforcement of creditors’ rights generally or by general equitable
principles).


 


(iii)                               No
Conflict or Violation; No Defaults. 
The execution, delivery and performance by each of the Williams
Contractors of this Agreement does not and will not violate or conflict with
any provision of its organizational documents and does not and will not  violate any applicable provision of Law, or
any order, judgment or decree of any Governmental Authority, nor violate or
result in a breach of or constitute (with due notice or lapse of time or both)
a default under any contract, lease, loan agreement, mortgage, security
agreement, trust indenture or other agreement or instrument to which any
Williams Contractor is a party or by which it is bound or to which any of its
properties or assets is subject, nor result in the creation or imposition of
any encumbrance upon any of its properties or assets where such violations,
breaches or defaults in the aggregate would have a material adverse effect on
the transactions contemplated hereby or on the assets, properties, business,
operations, net income or financial condition of Williams.


 


10.                                 Indemnification;
Release; Limit on Liability.


 


(a)                                  Subject
to Section 10(c), Subcontractor
shall indemnify and hold harmless Williams, each of the Williams Contractors
and each of their respective officers, directors, employees, agents and
affiliates (and the officers, directors, employees and agents of such
affiliates) (the “Williams Indemnified
Parties”) from and against any and all Claims arising out of,
relating to or resulting from Subcontractor’s,
Buyer’s or any Partnership Entity’s performance of the Services specified under
this Agreement to the extent such Claim results from Subcontractor’s, Buyer’s or such Partnership Entity’s negligence
or willful failure to perform its obligations hereunder.


 


(b)                                 The
Williams Contractors shall, jointly and severally, indemnify and hold harmless Subcontractor and, if designated by Subcontractor to provide Services
hereunder, Buyer and any Partnership Entity and each of their officers,
directors, employees, agents and affiliates, including Buyer (and the officers,
directors, employees and agents of such affiliates) (the “Subcontractor Indemnified Parties”), if Subcontractor, Buyer or any such
Partnership Entity shall at any time or from time to time be subject to any Claims
arising out of, relating to or resulting from the performance of the Services
specified under this Agreement by any party, except to the extent such Claim
results from Subcontractor’s, Buyer’s or any such Partnership Entity’s
negligence or willful failure to perform its obligations hereunder.


 


(c)                                  Notwithstanding
clause (a) of this Section 10, with respect to any Claim relating to
Services described under the caption Article II of Exhibit A (“Services
Relating to Longhorn”) that also is a “Claim” within the meaning of clauses (1)
or (2) of Section 12.1 of the Longhorn Operating Agreement


 


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or the last
sentence of Section 12.2 of the Longhorn Operating Agreement, Subcontractor
shall not be required to indemnify the Williams Indemnified Parties unless, and
only to the extent that, Subcontractor would otherwise be obligated to
indemnify the Williams Indemnified Parties under clause (a) of this Section
10 and the Operator (as such term is defined in the Longhorn Operating
Agreement) is also required to indemnify one or more members of the Owner Group
(as such term is defined in the Longhorn Operating Agreement) pursuant to
Section 12 of the Longhorn Operating Agreement in connection with such Claim


 


(d)                                 Notwithstanding
anything to the contrary in this Agreement, the Williams Contractors shall not
be liable to Subcontractor, any of the Partnership Entities or Buyer, nor shall
Subcontractor, any Partnership Entity designated by Subcontractor to provide
Services hereunder or Buyer, be liable to the Williams Contractors, for any
exemplary, punitive, special, indirect, consequential, remote, or speculative
damages (including, without limitation, any damages on account of lost profits
or opportunities) resulting from or arising out of this Agreement or the
transactions contemplated hereby.


 


(e)                                  The
obligations of the parties in this Section 10 shall not limit their
respective indemnification obligations, or those of their affiliated parties,
under the Purchase Agreement.


 


11.                                 Insurance.   Subcontractor shall
obtain and maintain, or cause to be obtained and maintained, throughout the
term of this Agreement, at Subcontractor’s own expense and with nationally
reputable insurance companies and authorized to do business in the state or
states in which the Services are to be performed, insurance coverages of the
types and limits set forth in Exhibit B.  Subcontractor shall furnish the Williams Contractors with
satisfactory evidence of such insurance coverages prior to commencing the
performance of any Services.  If
applicable Law limits waiver of the right of subrogation or prohibits naming
the Williams Contractors as an “Additional Insured”, then Exhibit B
shall be deemed amended to comply with applicable Law and to provide the waiver
of subrogation or designation of Subcontractor as an Additional Insured to the
maximum limit permitted by applicable Law. 
If Subcontractor’s insurance policy is terminated or expires during the
term of this Agreement, the Williams Contractor shall have the right to
terminate this Agreement for cause and/or immediately cause Subcontractor
suspend performance of the Services.


 


12.                                 Term.  The term of this
Agreement shall extend for a period of one (1) year from the date of this
Agreement and shall be renewed for a successive one-year term each year
thereafter, unless terminated pursuant to this Section 12; provided, however, Subcontractor may
terminate this Agreement upon written notice to the Williams Contractors six
(6) months prior to the end of any annual term, and (with the exception of Section
5) the Williams Contractors may terminate this Agreement (or any one or
more Services to be provided hereunder) immediately upon providing thirty (30)
days advance written notice to Subcontractor.


 


13.                                 Severance
Costs.  In the event of the
termination by the Williams Contractors pursuant to Section 12 or
otherwise of one or more Services provided hereunder, the Williams Contractors shall be responsible for
reimbursing Subcontractor, or its designee, for the severance costs associated
with the termination by Buyer or any of the Partnership Entities of any of
their employees in connection therewith if,
at the time of such termination, any such terminated employee was performing
one of the jobs listed on Exhibit C hereto; provided, the Williams Contractors shall only be obligated
to make reimbursement for severance costs equal to the cost of those benefits
to which any such employee would be entitled under Williams’ severance programs
(as in effect at the time of any such termination), taking into account the
aggregate time of service of such terminated employee as an employee of
Williams and Subcontractor (and their respective affiliates). Notwithstanding
the foregoing provisions of this Section 13, the Williams Contractors
shall not be responsible for reimbursing Subcontractor for severance costs
associated with the termination of more than one employee performing each of
the jobs listed on Exhibit C hereto.


 


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14.                                 Amendments.  This Agreement may be amended, modified or
supplemented only by a written instrument executed by the Williams Contractors
and Subcontractor. The execution of such instrument by any Partnership Entity
shall not be required.


 


15.                                 Permits and Notices. 
Unless otherwise expressly provided, Subcontractor shall secure all
permits, certificates and licenses and give all notices required under
applicable Law to perform the Services.


 


16.                                 DOT Regulations.  If Subcontractor or a Partnership Entity designated by
Subcontractor performs Services regulated by the Department of Transportation
(“DOT”), Subcontractor (and/or
any such Partnership Entity) shall comply with all requirements imposed by such
DOT regulations.  Subcontractor shall
require any subcontractors who perform Services regulated by the DOT to comply
with all DOT regulations.  Subcontractor
shall provide the Williams Contractors with a list of subcontractors performing
Services regulated by the DOT prior to commencement of such Services.


 


17.                                 Exhibits.  The Exhibits to this Agreement that are
specifically referred to herein are a part of this Agreement as if fully set
forth herein.  All references herein to
Articles, Sections, subsections, paragraphs, subparagraphs, clauses and
Exhibits shall be deemed references to such parts of this Agreement, unless the
context shall otherwise require.


 


18.                                 Notices.  All notices shall be
directed to the addresses set forth below:


 


If to the
Williams Contractors:


 


Williams Petroleum
Services, LLC


Attention: 
Mr. Tony Gehres


One Williams Center


Tulsa, OK  74172


Facsimile: (918) 573-4503


 


Williams Alaska
Pipeline Company, LLC


Attention: Mr. Tony Gehres


One Williams Center


Tulsa, OK 
74172


Facsimile: (918) 573-4503


 


(b)                                 If to the
Subcontractor:




Williams Pipe Line
Company, LLC


One Williams Center

Tulsa, Oklahoma  74172

Facsimile: (918) 573-6928

Attention: Mr. Lonny Townsend


 


19.                                 Successors
and Assigns.  This Agreement shall
inure to the benefit of, and be binding upon, the Williams Contractors and
Subcontractor and their respective successors and permitted assigns.  No party may assign or otherwise transfer
all or any of its rights, benefits or obligations hereunder without the prior
written consent of the other party, and any assignment without such consent
shall be void; provided however,
that, upon written notice to the other party but without the prior written
consent of such other party, a party may assign or otherwise transfer its
rights, benefits and obligations hereunder to another


 


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person or entity in connection
with an acquisition, merger, consolidation, sale of assets or other transaction
involving such other person or entity and constituting a change of control of
such party hereto.


 


20.                                 Signatures;
Counterparts.  Facsimile
transmission of any signed original document and/or retransmission of any
signed facsimile transmission shall be the same as delivery of an
original.  At the request of the
Williams Contractors or Subcontractor, the parties will confirm facsimile
transmission by signing a duplicate original document.  This Agreement may be executed in two or
more counterparts, each of which shall be deemed an original and all of which
together shall be considered one and the same agreement.


 


21.                                 Compliance with Applicable Laws.  Subcontractor
warrants that it and any Partnership Entity that performs Services hereunder
are, and shall remain, familiar with applicable Laws and shall comply and cause
all of its employees, and those employees of any such Partnership Entity, to
comply with applicable Law throughout the term of this Agreement.


 


22.                                 Negotiated
Agreement.  This Agreement has been
negotiated by the parties and the fact that the initial and final draft will
have been prepared by any party will not give rise to any presumption for or
against any party to this Agreement or be used in any respect or forum in the
construction or interpretation of this Agreement or any of its provisions.


 


23.                                 Waiver.  No consent or waiver, express or implied, by
any party to or of any breach or default by any other party in the performance
by such other party 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 of obligations hereunder by such other party hereunder.  Failure on the part of any party to complain
of any act or failure to act of any other party or to declare any other party
in default, irrespective of how long such failure continues, shall not
constitute a waiver by such first party of any of its rights hereunder.


 


24.                                 Severability.  If any term, provision, covenant or
restriction of this Agreement is held by a court of competent jurisdiction to
be invalid, void or unenforceable, each of the Williams Contractors and Subcontractor
direct that such court interpret and apply the remainder of this Agreement in
the manner that it determines most closely effectuates their intent in entering
into this Agreement, and in doing so particularly take into account the
relative importance of the term, provision, covenant or restriction being held
invalid, void or unenforceable.


 


25.                                 Headings
/ Interpretation.  The headings in
this Agreement are for reference only, and shall not affect the interpretation
of this Agreement. Whenever the words “include,” “includes,” or “including,”
are used in this Agreement, they shall be deemed to be followed by the words
“without limitation.”


 


26.                                 Third
Party Beneficiaries.  Except for
Buyer or any Partnership Entity designated by Subcontractor to perform Services
hereunder which in fact performs such Services, in which case Buyer or such
Partnership Entity is an intended third party beneficiary hereof, and except as
set forth in Sections 11 (Indemnification) and 19 (Successor and Assigns),
nothing in this Agreement is intended or shall be construed to give any person,
other than the parties hereto, their successors and permitted assigns, any
legal or equitable right, remedy or claim under or in respect of this Agreement
or any provision contained herein.


 


27.                                 Entire
Agreement.  This Agreement, together
with the exhibits attached hereto, and the provisions of the Purchase Agreement
relating hereto, represent the entire agreement and understanding of the
parties hereto and thereto with reference to the services set forth herein and
no representations or warranties have been made in connection herewith other
than those expressly set forth herein or therein.


 


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This Agreement, together with
the exhibits attached hereto, and the provisions of the Purchase Agreement
relating hereto,  supersedes all prior
negotiations, discussions, correspondence, communications, understandings and
agreements between the parties relating to the subject matter hereof and all
prior drafts of such documents (including Exhibit 1.2(a)(iv)(4) to the Purchase
Agreement).  No prior drafts of such
documents and no words or phrases from any such prior drafts shall be
admissible into evidence in any action or suit involving such documents.


 


28.                                 Governing
Law. This Agreement shall be governed by 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.


 


29.                                 Agreement
Binding on Entities Other Than Parties. 
Subcontractor shall use commercially reasonable efforts to cause the
Partnership Entities to be bound by the terms and conditions of this Agreement,
and Subcontractor shall be responsible for any breaches thereof by any such
Partnership Entity.  Subcontractor and
the Partnership Entities are jointly and severally liable hereunder.


 


30.                                 Press
Release.  Except as required by Law
or applicable stock exchange rules, no party hereto shall issue any press
releases relating to or arising out of the performance of this Agreement
without the prior written consent and approval of the content of such statement
by the other party (which consent shall not be unreasonably withheld).


 


31.                                 Reasonable
Cooperation.  During the term of
this Agreement, each of the parties shall reasonably cooperate with each other
to perform its obligations under this Agreement, including without limitation,
agreeing to negotiate in good faith to enter into an amendment to this
Agreement upon the written request of any party hereto.


 


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IN WITNESS
WHEREOF, the parties have caused this Agreement to be executed and delivered by
their duly authorized officers as of the date first above written.


 


	
   

  	
  WILLIAMS CONTRACTORS

  
	
   

  	
   

  	
   

  
	
   

  	
  WILLIAMS PETROLEUM SERVICES, LLC

  
	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Ralph A. Hill

  	
   

  
	
   

  	
  Name:

  	
  Ralph A. Hill

  
	
   

  	
  Title:

  	
  Authorized Signatory

  
	
   

  	
   

  	
   

  
	
   

  	
  WILLIAMS ALASKA PIPELINE COMPANY, LLC

  
	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Ralph A. Hill

  	
   

  
	
   

  	
  Name:

  	
  Ralph A. Hill

  
	
   

  	
  Title:

  	
  Authorized Signatory

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  SUBCONTRACTOR

  
	
   

  	
   

  	
   

  
	
   

  	
  WILLIAMS PIPE LINE COMPANY, LLC

  a Delaware limited liability company

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  Williams Energy Partners L.P.,

  
	
   

  	
   

  	
  its Sole Member

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  WEG GP LLC, its General Partner

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Don R. Wellendorf

  	
   

  
	
   

  	
  Name:

  	
  Don R. Wellendorf

  
	
   

  	
  Title:

  	
  Authorized Signatory

  
									



 


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