Document:

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Exhibit 10.2

WILLIAMS PARTNERS GP LLC

LONG-TERM INCENTIVE PLAN

     SECTION 1. Purpose of the Plan.

     The Williams Partners GP LLC Long-Term Incentive Plan (the “Plan”) is intended to promote the
interests of Williams Partners L.P., a Delaware limited partnership (the “Partnership”), by
providing to employees, consultants, and directors of Williams Partners GP LLC, a Delaware limited
liability company (the “Company”), and its Affiliates who perform services for the Partnership and
its subsidiaries incentive compensation awards that are based on Units for superior performance.
The Plan is also contemplated to enhance the ability of the Company and its Affiliates to attract
and retain the services of individuals who are essential for the growth and profitability of the
Partnership and to encourage them to devote their best efforts to advancing the business of the
Partnership and its subsidiaries.

     SECTION 2. Definitions.

     As used in the Plan, the following terms shall have the meanings set forth below:

     “Affiliate” means, with respect to any Person, any other Person that directly or indirectly
through one or more intermediaries controls, is controlled by or is under common control with, the
Person in question. As used herein, the term “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.

     “Award” means an Option, Restricted Unit, Phantom Unit or Unit Appreciation Right granted
under the Plan, and shall include any tandem DERs granted with respect to a Phantom Unit, Option or
Unit Appreciation Right.

     “Award Agreement” means the written agreement by which an Award shall be evidenced.

     “Board” means the Board of Directors of the Company.

     “Change of Control” means, and shall be deemed to have occurred upon the occurrence of one or
more 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 assets of the Partnership,
the Company or The Williams Companies, Inc. to any Person and/or its Affiliates, other than to the
Partnership, the Company and/or any of their Affiliates; or (ii) the consolidation, reorganization,
merger or other transaction pursuant to which more than 50% of the voting power of the outstanding
equity interests in the Partnership, the Company or The Williams Companies, Inc. cease to be owned
by the Persons who own such interests as of the effective date of the initial public offering of
Units.

     Solely with respect to any Award that is subject to Section 409A of the Code and to the extent
that the definition of change of control under Section 409A applies to limited liability companies,
this definition is intended to comply with the definition of change of control under Section 409A
of the Code as in effect commencing January 1, 2005 and, to the extent that the

 

 

above definition does not so comply, such definition shall be void and of no effect and, to the extent required to
ensure that this definition complies with the requirements of Section 409A of the Code, the
definition of such term set forth in regulations or other regulatory guidance issued under Section
409A of the Code by the appropriate governmental authority is hereby incorporated by reference into
and shall form part of this Plan as fully as if set forth herein verbatim and the Plan shall be
operated in accordance with the above definition of Change of Control as modified to the extent
necessary to ensure that the above definition complies with the definition prescribed in such
regulations or other regulatory guidance insofar as the definition relates to any Award that is
subject to Section 409A of the Code.

     “Committee” means the Compensation Committee of the Board or such other committee of the Board
appointed by the Board to administer the Plan.

     “Common Unit” has the meaning given to such term in the Partnership Agreement.

     “Consultant” means an individual who performs services for the Partnership and is not an
Employee or a Director.

     “DER” means a distribution equivalent right, which is contingent right, granted in tandem with
a specific Award of any Unit Appreciation Right, Option or Phantom Unit, to receive an amount in
cash equal to the cash distributions made by the Partnership with respect to a Unit during the
period such Award is outstanding.

     “Director” means a member of the Board who is not an Employee.

     “Employee” means any employee of the Company or an Affiliate who performs services for the
Partnership.

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

     “Fair Market Value” means the closing sales price of a Unit on the date of determination (or
if there is no trading in the Units on such date, on the next preceding date on which there was
trading) as reported in The Wall Street Journal (or other reporting service approved by the
Committee). In the event Units are not publicly traded at the time a determination of Fair Market
Value is required to be made hereunder, the determination of Fair Market Value shall be made in
good faith by the Committee.

     “Option” means an option to purchase Units granted under the Plan.

     “Participant” means any Employee, Consultant or Director granted an Award under the Plan.

     “Partnership Agreement” means the First Amended and Restated Agreement of Limited Partnership
of Williams Partners L.P., as it may be amended or amended and restated from time to time.

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     “Person” means an individual or a corporation, limited liability company, partnership, joint
venture, trust, unincorporated organization, association, governmental agency or political
subdivision thereof or other entity.

     “Phantom Unit” means a phantom (notional) Unit granted under the Plan which upon vesting
entitles the Participant to receive a Unit or an amount of cash equal to the Fair Market Value of a
Unit, as determined by the Committee in its discretion.

     “Restricted Period” means the period established by the Committee with respect to an Award
during which the Award remains subject to forfeiture and is either not exercisable by or payable to
the Participant, as the case may be.

     “Restricted Unit” means a Unit granted under the Plan that is subject to a Restricted Period.

     “Rule 16b-3” means Rule 16b-3 promulgated by the SEC under the Exchange Act, or any successor
rule or regulation thereto as in effect from time to time.

     “SEC” means the Securities and Exchange Commission, or any successor thereto.

     “UDR” means a unit distribution right, which is a distribution made by the Partnership with
respect to a Restricted Unit.

     “Unit” means a Common Unit.

     “Unit Appreciation Right” means an Award that, upon exercise, entitles the holder to receive
the excess of the Fair Market Value of a Unit on the exercise date over the exercise price
established for such Unit Appreciation Right. Such excess may be paid in cash and/or in Units as
determined by the Committee in its discretion.

     SECTION 3. Administration.

     The Board does not initially intend to grant any Award under the Plan; provided however, the
Board reserves the right to implement the Plan in the future and upon implementation by resolution
of the Board, the Plan shall be administered by the Committee. A majority of the Committee shall
constitute a quorum, and the acts of the members of the Committee who are present at any meeting
thereof at which a quorum is present, or acts unanimously approved by the members of the Committee
in writing, shall be the acts of the Committee. Subject to the following and any applicable law,
the Committee, in its sole discretion, may delegate any or all of its powers and duties under the
Plan, including the power to grant Awards under the Plan, to the Chief Executive Officer of the
Company, subject to such limitations on such delegated powers and duties as the Committee may
impose, if any. Upon any such delegation all references in the Plan to the “Committee”, other than in Section 7, shall
be deemed to include the Chief Executive Officer; provided, however, that such delegation shall not
limit the Chief Executive Officer’s right to receive Awards under the Plan. Notwithstanding the
foregoing, the Chief Executive Officer may not grant Awards to, or take any action with respect to
any Award previously granted to, a person who is an officer subject to Rule 16b-3 or who is a
member of the Board. Subject to the terms of the Plan and applicable law, and in addition to

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other express powers and authorizations conferred on the Committee by the Plan, the Committee shall have
full power and authority to: (i) designate Participants; (ii) determine the type or types of Awards
to be granted to a Participant; (iii) determine the number of Units to be covered by Awards; (iv)
determine the terms and conditions of any Award; (v) determine whether, to what extent, and under
what circumstances Awards may be settled, exercised, canceled, or forfeited; (vi) interpret and
administer the Plan and any instrument or agreement relating to an Award made under the Plan; (vii)
establish, amend, suspend, or waive such rules and regulations and appoint such agents as it shall
deem appropriate for the proper administration of the Plan; and (viii) make any other determination
and take any other action that the Committee deems necessary or desirable for the administration of
the Plan. Unless otherwise expressly provided in the Plan, all designations, determinations,
interpretations, and other decisions under or with respect to the Plan or any Award shall be within
the sole discretion of the Committee, may be made at any time and shall be final, conclusive, and
binding upon all Persons, including the Company, the Partnership, any Affiliate, any Participant,
and any beneficiary of any Award.

     SECTION 4. Units.

     (a) Limits on Units Deliverable. Subject to adjustment as provided in Section 4(c),
the number of Units with respect to which Awards may be granted under the Plan is 700,000.
However, there shall not be any limitation on the number of Awards that may be granted and paid in
cash. If any Award expires, is canceled, exercised, paid or otherwise terminates without the
delivery of Units, then the Units covered by such Award, to the extent of such expiration,
cancellation, exercise, payment or termination, shall again be Units with respect to which Awards
may be granted. In the event that Units issued under the Plan are reacquired by the Company
pursuant to any forfeiture provision, such Units shall again be available for the purposes of the
Plan. In the event a Participant pays for any Award through the delivery of previously acquired
Units, the number of Units available shall be increased by the number of Units delivered by the
Participant.

     (b) Sources of Units Deliverable Under Awards. Any Units delivered pursuant to an
Award shall consist, in whole or in part, of Units acquired in the open market, from any Affiliate,
the Partnership or any other Person, or any combination of the foregoing.

     (c) Adjustments. In the event that the Committee determines that any distribution
(whether in the form of cash, Units, other securities, or other property), recapitalization, Unit
split, reverse Unit split, reorganization, merger, consolidation, split-up, spin-off, combination,
repurchase, or exchange of Units or other securities of the Partnership, issuance of warrants or
other rights to purchase Units or other securities of the Partnership, or other similar transaction
or event affects the Units such that an adjustment is determined by the Committee to be appropriate
in order to prevent dilution or enlargement of the benefits or potential benefits intended to
be made available under the Plan, then the Committee shall, in such manner as it may deem
equitable, adjust any or all of (i) the number and type of Units (or other securities or property)
with respect to which Awards may be granted, (ii) the number and type of Units (or other securities
or property) subject to outstanding Awards, and (iii) the grant or exercise price with respect to
any Award or, if deemed appropriate, make provision for a cash payment to the holder of an
outstanding Award; provided, that the number of Units subject to any Award shall always be a whole
number and, provided further, that the Committee shall not take any action otherwise

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authorized under this subparagraph (c) to the extent that (i) such action would cause (A) the application of
Section 409A or 162(m) of the Code to the Award or (B) create adverse tax consequences under
Section 409A or 162(m) of the Code should either or both of those Code sections apply to the Award
or (ii) except as permitted in Section7(c), materially reduce the benefit to the Participant
without the consent of the Participant.

     SECTION 5. Eligibility.

     Any Employee, Consultant or Director shall be eligible to be designated a Participant and
receive an Award under the Plan.

     SECTION 6. Awards.

     (a) Options. Subject to the provisions of the Plan, the Committee shall have the
authority to determine the Participants to whom Options shall be granted, the number of Units to be
covered by each Option, whether DERs are granted with respect to such Option, the purchase price
therefor and the conditions and limitations applicable to the exercise of the Option, including the
following terms and conditions and such additional terms and conditions, as the Committee shall
determine, that are not inconsistent with the provisions of the Plan.

     (i) Exercise Price. The purchase price per Unit purchasable under an Option
shall be determined by the Committee at the time the Option is granted, but shall not be
less than 100% of the Fair Market Value per Unit on the date of grant.

     (ii) Time and Method of Exercise. The Committee shall determine the time or
times at which an Option may be exercised in whole or in part, which may include, without
limitation, accelerated vesting upon the achievement of specified performance goals, and the
method or methods by which payment of the exercise price with respect thereto may be made or
deemed to have been made, which may include, without limitation, cash, check acceptable to
the Company, a “cashless-broker” exercise through procedures approved by the Company, other
securities or other property, or any combination thereof, having a Fair Market Value on the
exercise date equal to the relevant exercise price.

     (iii) Forfeiture. Except as otherwise provided in the terms of the Option
grant, upon termination of a Participant’s employment with or consulting services to the
Company and its Affiliates or membership on the Board, whichever is applicable, for any
reason during the applicable Restricted Period, all Options shall be forfeited by the
Participant unless otherwise provided in a written agreement between the Participant and the
Company or its affiliates. The Committee may, in its discretion, waive in whole or in part
such forfeiture with respect to a Participant’s Options.

     (iv) DERs. To the extent provided by the Committee, in its discretion, a grant
of Options may include a tandem DER grant, which may provide that such DERs be credited to a
bookkeeping account subject to the same vesting restrictions as the tandem Options Award, or
be subject to such other provisions or restrictions as determined by the Committee in its
discretion. Notwithstanding any other provision of the Plan to the contrary, any grant of
DERs with respect to Options shall contain terms that (i) are

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designed to avoid application of Section 409A of the Code to the Award or (ii) are designed to avoid adverse tax
consequences under Section 409A should that Code section apply.

     (b) Restricted Units and Phantom Units. The Committee shall have the authority to
determine the Participants to whom Restricted Units or Phantom Units shall be granted, the number
of Restricted Units or Phantom Units to be granted to each such Participant, the Restricted Period,
the conditions under which the Restricted Units or Phantom Units may become vested or forfeited,
which may include, without limitation, the accelerated vesting upon the achievement of specified
performance goals, and such other terms and conditions as the Committee may establish with respect
to such Awards, including whether DERs are granted with respect to the Phantom Units or UDRs are
granted with respect to Restricted Units.

     (i) DERs. To the extent provided by the Committee, in its discretion, a grant
of Phantom Units may include a tandem DER grant, which may provide that such DERs be
credited to a bookkeeping account (without interest) or that additional Phantom Units be
awarded, which account or Phantom Units may be subject to the same vesting restrictions as
the tandem Phantom Unit Award, or be subject to such other provisions or restrictions as
determined by the Committee in its discretion. Notwithstanding any other provision of the
Plan to the contrary, any grant of DERs with respect to Phantom Units shall contain terms
that (i) are designed to avoid application of Section 409A of the Code to the Award or (ii)
are designed to avoid adverse tax consequences under Section 409A should that Code section
apply.

     (ii) UDRs. To the extent provided by the Committee, in its discretion, a grant
of Restricted Units may provide that distributions made by the Partnership with respect to
the Restricted Units shall be subject to the same forfeiture and other restrictions as the
Restricted Unit and, if restricted, such distributions shall be held, without interest,
until the Restricted Unit vests or is forfeited with the UDR being paid or forfeited at the
same time, as the case may be. Absent such a restriction on the UDRs in the Award
Agreement, UDRs shall be paid to the holder of the Restricted Unit without restriction.

     (iii) Forfeitures. Except as otherwise provided in the terms of the Restricted
Units or Phantom Units grant, upon termination of a Participant’s employment with or
consulting services to the Company and its Affiliates or membership on the Board,
whichever is applicable, for any reason during the applicable Restricted Period, all
outstanding Restricted Units and Phantom Units awarded the Participant shall be
automatically forfeited on such termination unless otherwise provided in a written agreement
between the Participant and the Company or its Affiliates. The Committee may, in its
discretion, waive in whole or in part such forfeiture with respect to a Participant’s
Restricted Units and/or Phantom Units.

     (iv) Lapse of Restrictions.

     (A) Phantom Units. Unless a different payment time is specified in the
Award Agreement, upon or as soon as reasonably practical following the vesting of
each Phantom Unit, subject to the provisions of Section 8(b), the Participant

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shall be entitled to receive from the Company one Unit or cash equal to the Fair Market
Value of a Unit, as determined by the Committee in its discretion.

     (B) Restricted Units. Upon or as soon as reasonably practical
following the vesting of each Restricted Unit, subject to the provisions of Section
8(b), the Participant shall be entitled to have the restrictions removed from his or
her Unit certificate so that the Participant then holds an unrestricted Unit.

     (c) Unit Appreciation Rights. The Committee shall have the authority to determine the
Participants to whom Unit Appreciation Rights shall be granted, the number of Units to be covered
by each grant, whether DERs are granted with respect to such Unit Appreciation Right, the exercise
price therefor and the conditions and limitations applicable to the exercise of the Unit
Appreciation Right, including the following terms and conditions and such additional terms and
conditions, as the Committee shall determine, that are not inconsistent with the provisions of the
Plan.

     (i) Exercise Price. The exercise price per Unit Appreciation Right shall be
determined by the Committee at the time the Unit Appreciation Right is granted, but shall
not be less than 100% of the Fair Market Value per Unit on the date of grant.

     (ii) Time of Exercise. The Committee shall determine the Restricted Period,
i.e., the time or times at which a Unit Appreciation Right may be exercised in whole or in
part, which may include, without limitation, accelerated vesting upon the achievement of
specified performance goals.

     (iii) Forfeitures. Except as otherwise provided in the terms of the Unit
Appreciation Right grant, upon termination of a Participant’s employment with or consulting
services to the Company and its Affiliates or membership on the Board, whichever is
applicable, for any reason during the applicable Restricted Period, all outstanding Unit
Appreciation Rights awarded the Participant shall be automatically forfeited on such
termination. The Committee may, in its discretion, waive in whole or in part such
forfeiture with respect to a Participant’s Unit Appreciation Rights.

     (iv) DERs. To the extent provided by the Committee, in its discretion, a grant
of Unit Appreciation Rights may include a tandem DER grant, which may provide that such DERs
be credited to a bookkeeping account (without interest) or that additional Unit
Appreciation Rights be awarded, which Unit Appreciation Rights may be subject to the
same vesting restrictions as the tandem Unit Appreciation Rights Award, or be subject to
such other provisions or restrictions as determined by the Committee in its discretion.
Notwithstanding any other provision of the Plan to the contrary, any grant of DERs with
respect to Unit Appreciation Rights shall contain terms that (i) are designed to avoid
application of Section 409A of the Code to the Award or (ii) are designed to avoid adverse
tax consequences under Section 409A should that Code section apply.

     (d) General.

     (i) Awards May Be Granted Separately or Together. Awards may, in the
discretion of the Committee, be granted either alone or in addition to, in tandem with, or

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in substitution for any other Award or any award granted under any other plan of the Company
or any Affiliate. No Award shall be issued in tandem with another Award if the tandem
Awards would result in adverse tax consequences under Section 409A of the Code. Awards
granted in addition to or in tandem with other Awards or awards granted under any other plan
of the Company or any Affiliate may be granted either at the same time as or at a different
time from the grant of such other Awards or awards.

     (ii) Limits on Transfer of Awards.

     (A) Except as provided in (C) below or as provided in the Award Agreement, each
Option and Unit Appreciation Right shall be exercisable only by the Participant
during the Participant’s lifetime, or by the person to whom the Participant’s rights
shall pass by will or the laws of descent and distribution.

     (B) Except as provided in (C) below, no Award and no right under any such Award
may be assigned, alienated, pledged, attached, sold or otherwise transferred or
encumbered by a Participant and any such purported assignment, alienation, pledge,
attachment, sale, transfer or encumbrance shall be void and unenforceable against
the Company, the Partnership or any Affiliate.

     (C) To the extent specifically provided by the Committee with respect to an
Option or Unit Appreciation Right grant, an Option or Unit Appreciation Right may be
transferred by a Participant without consideration to immediate family members or
related family trusts, limited partnerships or similar entities or on such terms and
conditions as the Committee may from time to time establish.

     (iii) Term of Awards. The term of each Award shall be for such period as may
be determined by the Committee; provided, that in no event shall the term of any Award
exceed a period of 10 years from the date of its grant.

     (iv) Unit Certificates. All certificates for Units or other securities of the
Partnership delivered under the Plan pursuant to any Award or the exercise thereof shall be
subject to such stop transfer orders and other restrictions as the Committee may deem
advisable under the Plan or the rules, regulations, and other requirements of the SEC, any
stock exchange upon which such Units or other securities are then listed, and any
applicable federal or state laws, and the Committee may cause a legend or legends to be
put on any such certificates to make appropriate reference to such restrictions.

     (v) Consideration for Grants. Awards may be granted for such consideration,
including services, as the Committee determines.

     (vi) Delivery of Units or other Securities and Payment by Participant of
Consideration. Notwithstanding anything in the Plan or any Award Agreement to the
contrary, delivery of Units pursuant to the exercise or vesting of an Award may be deferred
for any period during which, in the good faith determination of the Committee, the Company
is not reasonably able to obtain Units to deliver pursuant to such Award without violating
the rules or regulations of any applicable law or securities exchange. No Units or other
securities shall be delivered pursuant to any Award until payment in

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full of any amount required to be paid pursuant to the Plan or the applicable Award Agreement (including,
without limitation, any exercise price or tax withholding) is received by the Company. Such
payment may be made by such method or methods and in such form or forms as the Committee
shall determine, including, without limitation, cash, other Awards, withholding of Units,
cashless broker exercises with simultaneous sale, or any combination thereof; provided,
however, that the combined value, as determined by the Committee, of all cash and cash
equivalents and the Fair Market Value of any such Units or other property so tendered to the
Company, as of the date of such tender, is at least equal to the full amount required to be
paid to the Company pursuant to the Plan or the applicable Award Agreement.

     (vii) Change in Control. Unless specifically provided otherwise in the Award
Agreement, upon a Change of Control all outstanding Awards shall automatically vest and be
payable or become exercisable in full, as the case may be. In this regard, all Restricted
Periods shall terminate and all performance criteria, if any, shall be deemed to have been
achieved at the maximum level.

     (viii) Notwithstanding any other provision of the Plan to the contrary, any Award
granted under the Plan shall contain terms that (i) are designed to avoid application of
Section 409A of the Code to the Award or (ii) are designed to avoid adverse tax consequences
under Section 409A of the Code should that Code section apply to the Award.

     SECTION 7. Amendment and Termination.

     Except to the extent prohibited by applicable law:

     (a) Amendments to the Plan. Except as required by applicable law or the rules of the
principal securities exchange on which the Units are traded and subject to Section 7(b) below, the
Board or the Committee may amend, alter, suspend, discontinue, or terminate the Plan in any manner,
including increasing the number of Units available for Awards under the Plan, without the consent
of any partner, Participant, other holder or beneficiary of an Award, or other Person.

     (b) Amendments to Awards. Subject to Section 7(a), the Committee may waive any
conditions or rights under, amend any terms of, or alter any Award theretofore granted, provided no
change, other than pursuant to Section 7(c), in any Award shall materially reduce the benefit to
Participant without the consent of such Participant.

     (c) Adjustment of Awards Upon the Occurrence of Certain Unusual or Nonrecurring
Events. The Committee is hereby authorized to make adjustments in the terms and conditions of,
and the criteria included in, Awards in recognition of unusual or nonrecurring events (including,
without limitation, the events described in Section 4(c) of the Plan) affecting the Partnership or
the financial statements of the Partnership, or of changes in applicable laws, regulations, or
accounting principles, whenever the Committee determines that such adjustments are appropriate in
order to prevent dilution or enlargement of the benefits or potential benefits intended to be made
available under the Plan or such Award.

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     SECTION 8. General Provisions.

     (a) No Rights to Award. No Person shall have any claim to be granted any Award under
the Plan, and there is no obligation for uniformity of treatment of Participants. The terms and
conditions of Awards need not be the same with respect to each recipient.

     (b) Tax Withholding. The Company or any Affiliate is authorized to withhold from any
Award, from any payment due or transfer made under any Award or from any compensation or other
amount owing to a Participant the amount (in cash, Units, other securities, Units that would
otherwise be issued pursuant to such Award or other property) of any applicable taxes payable in
respect of the grant of an Award, its exercise, the lapse of restrictions thereon, or any payment
or transfer under an Award or under the Plan and to take such other action as may be necessary in
the opinion of the Company to satisfy its withholding obligations for the payment of such taxes.

     (c) No Right to Employment or Services. The grant of an Award shall not be construed
as giving a Participant the right to be retained in the employ of the Company or any Affiliate, to
continue as a Consultant, or to remain on the Board, as applicable. Further, the Company or an
Affiliate may at any time dismiss a Participant from employment or terminate a consulting
relationship, free from any liability or any claim under the Plan, unless otherwise expressly
provided in the Plan, any Award Agreement or other agreement.

     (d) Governing Law. The validity, construction, and effect of the Plan and any rules
and regulations relating to the Plan shall be determined in accordance with the laws of the State
of Oklahoma, without regard to its conflict of laws principles.

     (e) Severability. If any provision of the Plan or any Award is or becomes or is
deemed to be invalid, illegal, or unenforceable in any jurisdiction or as to any Person or Award,
or would disqualify the Plan or any Award under any law deemed applicable by the Committee, such
provision shall be construed or deemed amended to conform to the applicable laws, or if it cannot
be construed or deemed amended without, in the determination of the Committee, materially altering
the intent of the Plan or the Award, such provision shall be stricken as to such
jurisdiction, person or Award and the remainder of the Plan and any such Award shall remain in
full force and effect.

     (f) Other Laws. The Committee may refuse to issue or transfer any Units or other
consideration under an Award if, in its sole discretion, it determines that the issuance or
transfer of such Units or such other consideration might violate any applicable law or regulation,
the rules of the principal securities exchange on which the Units are then traded, or entitle the
Partnership or an Affiliate to recover the same under Section 16(b) of the Exchange Act, and any
payment tendered to the Company by a Participant, other holder or beneficiary in connection with
the exercise of such Award shall be promptly refunded to the relevant Participant, holder or
beneficiary.

     (g) No Trust or Fund Created. Neither the Plan nor any Award shall create or be
construed to create a trust or separate fund of any kind or a fiduciary relationship between the
Company or any participating Affiliate and a Participant or any other Person. To the extent that

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any Person acquires a right to receive payments from the Company or any participating Affiliate
pursuant to an Award, such right shall be no greater than the right of any general unsecured
creditor of the Company or any participating Affiliate.

     (h) No Fractional Units. No fractional Units shall be issued or delivered pursuant to
the Plan or any Award, and the Committee shall determine whether cash, other securities, or other
property shall be paid or transferred in lieu of any fractional Units or whether such fractional
Units or any rights thereto shall be canceled, terminated, or otherwise eliminated.

     (i) Headings. Headings are given to the Sections and subsections of the Plan solely
as a convenience to facilitate reference. Such headings shall not be deemed in any way material or
relevant to the construction or interpretation of the Plan or any provision thereof.

     (j) Facility Payment. Any amounts payable hereunder to any person under legal
disability or who, in the judgment of the Committee, is unable to properly manage his financial
affairs, may be paid to the legal representative of such person, or may be applied for the benefit
of such person in any manner which the Committee may select, and the Company and its Affiliates
shall be relieved of any further liability for payment of such amounts.

     (k) Participation by Affiliates. In making Awards to Consultants and Employees
employed by an entity other than by the Company, the Committee shall be acting on behalf of the
Affiliate, and to the extent the Partnership has an obligation to reimburse the Company for
compensation paid to Consultants and Employees for services rendered for the benefit of the
Partnership, such payments or reimbursement payments may be made by the Partnership directly to the
Affiliate, and, if made to the Company, shall be received by the Company as agent for the
Affiliate.

     (l) Gender and Number. Words in the masculine gender shall include the feminine
gender, the plural shall include the singular and the singular shall include the plural.

     (m) No Guarantee of Tax Consequences. None of the Board, the Company, the Partnership
nor the Committee makes any commitment or guarantee that any federal, state or
local tax treatment will apply or be available to any person participating or eligible to
participate hereunder.

     SECTION 9. Term of the Plan.

     The Plan shall be effective on the date of its approval by the Board and shall continue until
the earlier of the date terminated by the Board or the date Units are no longer available for
issuance under the Plan. However, unless otherwise expressly provided in the Plan or in an
applicable Award Agreement, any Award granted prior to such termination, and the authority of the
Board or the Committee to amend, alter, adjust, suspend, discontinue, or terminate any such Award
or to waive any conditions or rights under such Award, shall extend beyond such termination date.

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Exhibit 10.3

Execution Copy

CONTRIBUTION, CONVEYANCE AND

ASSUMPTION AGREEMENT

WILLIAMS PARTNERS L.P.

 

 

TABLE OF CONTENTS

	 	 	 	 	 	 	 
	ARTICLE I DEFINITIONS; RECORDATION	 	 	4	 
	1.1
	 	Definitions	 	 	4	 
	 
	 	 	 	 	 	 
	ARTICLE II THE OFFERING AND RELATED TRANSACTIONS	 	 	7	 
	2.1
	 	Contribution of Gas Purchase Contract by WNGL to Holdings	 	 	7	 
	2.2
	 	Contribution of Gas Purchase Contract by Holdings to MCFS	 	 	7	 
	2.3
	 	Contribution by WES to GP LLC of an Interest in CTP	 	 	7	 
	2.4
	 	Contribution by GP LLC to the MLP of the CTP Interest	 	 	8	 
	2.5
	 	Contribution by WES to the MLP of its Remaining Interest in CTP	 	 	8	 
	2.6
	 	Contribution by WE to the MLP of an Interest in Discovery	 	 	8	 
	2.7
	 	Contribution by Williams Pipeline to the MLP of an Interest in Discovery	 	 	8	 
	2.8
	 	Contribution by Holdings to the MLP of All of Its Interests in MCFS	 	 	9	 
	2.9
	 	Public Cash Contribution	 	 	9	 
	2.10
	 	MLP Receipt of Cash Contribution	 	 	9	 
	2.11
	 	MLP Cash Distribution to Holdings and Williams Pipeline	 	 	9	 
	2.12
	 	Conveyance and Contribution by the MLP to the OLLC of its Interests in MCFS, CTP and Discovery	 	 	9	 
	 
	 	 	 	 	 	 
	ARTICLE III ASSUMPTION OF CERTAIN LIABILITIES	 	 	10	 
	3.1
	 	Assumption of Gas Purchase Contract Liabilities by Holdings	 	 	10	 
	3.2
	 	Assumption of Gas Purchase Contract Liabilities by MCFS	 	 	10	 
	3.3
	 	Assumption of CTP Liabilities by GP LLC	 	 	10	 
	3.4
	 	Assumption of CTP Liabilities by the MLP	 	 	11	 
	3.5
	 	Assumption of CTP Remaining Liabilities by the MLP	 	 	11	 
	3.6
	 	Assumption of WE Discovery Liabilities by the MLP	 	 	11	 
	3.7
	 	Assumption of Williams Pipeline Discovery Liabilities by the MLP	 	 	11	 
	3.8
	 	Assumption of MCFS Liabilities by the MLP	 	 	12	 
	3.9
	 	Assumption of MLP Aggregate Liabilities by the OLLC	 	 	12	 
	3.10
	 	General Provisions Relating to Assumption of Liabilities	 	 	12	 
	 
	 	 	 	 	 	 
	ARTICLE IV FURTHER ASSURANCES	 	 	12	 
	4.1
	 	Further Assurances	 	 	12	 
	4.2
	 	Other Assurances	 	 	12	 
	 
	 	 	 	 	 	 
	ARTICLE V MISCELLANEOUS	 	 	13	 
	5.1
	 	Order of Completion of Transactions	 	 	13	 
	5.2
	 	Costs	 	 	13	 
	5.3
	 	Headings; References; Interpretation	 	 	13	 
	5.4
	 	Successors and Assigns	 	 	14	 
	5.5
	 	No Third Party Rights	 	 	14	 
	5.6
	 	Counterparts	 	 	14	 
	5.7
	 	Governing Law	 	 	14	 
	5.8
	 	Severability	 	 	14	 
	5.9
	 	Amendment or Modification	 	 	14	 
	5.10
	 	Integration	 	 	14	 

-i- 

 

Execution Copy

CONTRIBUTION, CONVEYANCE AND ASSUMPTION AGREEMENT

     THIS CONTRIBUTION, CONVEYANCE AND ASSUMPTION AGREEMENT, dated as of August 23, 2005, is
entered into by and among Williams Energy Services, LLC, a Delaware limited liability company
(“WES”); Williams Partners GP LLC, a Delaware limited liability company (“GP LLC”);
Williams Partners L.P., a Delaware limited partnership (the “MLP”); Williams Partners
Operating LLC, a Delaware limited liability company (the “OLLC”); Williams Energy, L.L.C.,
a Delaware limited liability company (“WE”); Williams Discovery Pipeline LLC, a Delaware
limited liability company (“Williams Pipeline”); Williams Partners Holdings LLC, a Delaware
limited liability company (“Holdings”); and Williams Natural Gas Liquids, Inc.
(“WNGL”). The foregoing shall be referred to individually as a “Party” and
collectively as the “Parties.” Certain capitalized terms used are defined in Article I
hereof.

RECITALS

     WHEREAS, WES and GP LLC have formed the MLP pursuant to the Delaware Revised Uniform Limited
Partnership Act (the “Delaware Limited Partnership Act”), for the purpose of, among other
things, owning, operating and acquiring certain assets of certain subsidiaries of The Williams
Companies, Inc., a Delaware corporation (“TWC”), used in the business of gathering,
transporting and processing natural gas and fractionating and storing natural gas liquids.

     WHEREAS, in order to accomplish the objectives and purposes in the preceding recital, the
following actions have been taken prior to the date hereof:

	 	1.	 	Williams Midstream Natural Gas Liquids, Inc. (“WMNGL”) contributed the
Conway Storage East, Conway West and Mitchell storage assets, certain Conway real
estate, several easements and a letter of credit for storage abandonment to
Mid-Continent Fractionation and Storage, LLC (“MCFS”) in exchange for a
membership interest in MCFS.
	 
	 	2.	 	WNGL contributed a 50% undivided interest in the Conway fractionator, all
applicable contracts or agreements relating to the contributed assets (including but
not limited to the Conway fractionator operating agreement) and certain Conway real
estate to MCFS in exchange for a membership interest in MCFS.
	 
	 	3.	 	ESPAGAS USA Inc. (“Espagas”) conveyed certain Conway real estate to
MCFS in exchange for a membership interest in MCFS.
	 
	 	4.	 	MAPCO Inc. (“MAPCO”) conveyed certain Conway real estate to MCFS in
exchange for a membership interest in MCFS.
	 
	 	5.	 	WES formed GP LLC under the terms of the Delaware Limited Liability Company Act
(the “Delaware LLC Act”) and contributed $1,000 in exchange for all of the
membership interests in GP LLC.
	 
	 	6.	 	GP LLC and WES formed the MLP, to which GP LLC contributed $20 and WES
contributed $980 in exchange for a 2% general partner interest and 98% limited partner
interest, respectively.

 

 

	 	7.	 	WES acquired 100% of the membership interests in ENI British Borneo Pipeline
LLC (“ENIBBP”). Upon acquisition, the legal name of ENIBBP was changed to
Williams Discovery Pipeline LLC.
	 
	 	8.	 	The MLP formed the OLLC pursuant to the Delaware LLC Act and contributed $1,000
in exchange for all of the membership interests in the OLLC.
	 
	 	9.	 	WNGL formed Holdings pursuant to the Delaware LLC Act and contributed $1,000 in
exchange for all of the membership interests in Holdings.
	 
	 	10.	 	WMNGL, WNGL, Espagas and MAPCO contributed all of the outstanding membership
interests in MCFS to Holdings in exchange for membership interests in Holdings.
	 
	 	11.	 	Williams Mobile Bay Producer Services, L.L.C. (“WMBPS”) formed
Carbonate Trend Pipeline LLC (“CTP”) pursuant to the Delaware LLC Act and
contributed the Carbonate Trend Pipeline to CTP in exchange for all of the membership
interests in CTP.
	 
	 	12.	 	WMBPS distributed all of the membership interests in CTP to Arctic Fox Assets,
L.L.C. (“AFA”).
	 
	 	13.	 	AFA distributed all of the membership interests in CTP to TWC, which in turn,
contributed those membership interests to WES.
	 
	 	14.	 	The MLP, TWC and certain other TWC subsidiaries entered into the Amended and
Restated Credit Agreement, to, among other things, allow the MLP to borrow up to $75
million under the Amended and Restated Credit Agreement for general partnership
purposes, including acquisitions.

     WHEREAS, on the date of this Agreement, the MLP will enter into a working capital loan
agreement with TWC providing for a $20 million revolving credit facility.

     WHEREAS, concurrently with the consummation of the transactions contemplated hereby, each of
the following shall occur:

	 	1.	 	WNGL will contribute the Gas Purchase Contract to Holdings which, in turn, will
contribute the Gas Purchase Contract to MCFS.
	 
	 	2.	 	WES will contribute membership interests in CTP with an aggregate value equal
to 2% of the equity value of the MLP at closing ($6.14 million) to GP LLC as a capital
contribution.
	 
	 	3.	 	GP LLC will contribute its membership interest in CTP to the MLP in exchange
for (a) a continuation of GP LLC’s 2% general partner interest in the Partnership and
(b) the Incentive Distribution Rights.

-2-

 

	 	4.	 	WES will contribute its remaining membership interest in CTP to the MLP in
exchange for (a) 253,557 Common Units representing a 1.77% limited partner interest in
the MLP and (b) 887,450 Subordinated Units representing a 6.21% limited partner
interest in the MLP.
	 
	 	5.	 	WE will contribute a 23.33% membership interest (the “WE Discovery
Interest”) in Discovery Producer Services LLC (“Discovery”) to the MLP in
exchange for (y) 715,693 Common Units representing a 5.01% limited partner interest in
the MLP and (z) 2,504,925 Subordinated Units representing a 17.53% limited partner
interest in the MLP.
	 
	 	6.	 	Williams Pipeline will contribute its 16.67% membership interest (the
“Williams Pipeline Discovery Interest”) in Discovery to the MLP, in exchange
for (y) 345,567 Common Units representing a 2.42% limited partner interest in the MLP
and (z) 1,209,486 Subordinated Units representing a 8.47% limited partner interest in
the MLP.
	 
	 	7.	 	Holdings will contribute all of the membership interests in MCFS to the MLP in
exchange for (a) 685,183 Common Units representing a 4.80% limited partner interest in
the MLP and (b) 2,398,139 Subordinated Units representing a 16.79% limited partner
interest in the MLP.
	 
	 	8.	 	The public, through the underwriters of the Offering, will contribute $107.5
million, $100.2 million net of the underwriters’ discounts and commissions and
structuring fees (the “Offering Proceeds”), to the MLP in exchange for
5,000,000 Common Units representing a 35.00% limited partner interest in the MLP.
	 
	 	9.	 	The MLP will use the Offering Proceeds to (a) pay the underwriting discounts
and commissions and structuring fees (which may be withheld by the underwriters from
the Offering Proceeds as payment thereof), (b) pay transaction costs estimated to be
$4.3 million (excluding the underwriters’ discounts and commissions and structuring
fees and net of a reimbursement for certain expenses received from the underwriters),
(c) provide $12.8 million of additional working capital, (d) distribute $35.0 million
to Williams Pipeline to reimburse for certain capital expenditures incurred prior to
formation, (e) distribute $18.6 million to Holdings to reimburse for certain capital
expenditures incurred prior to formation and for the Gas Purchase Contract, (f)
distribute $3.8 million to WE to reimburse for certain capital expenditures incurred
prior to formation, (g) distribute $1.3 million to WES to reimburse for certain
capital expenditures incurred prior to formation and (h) provide $24.4 million to make
a capital contribution to Discovery to fund an escrow account in connection with the
Tahiti pipeline lateral expansion.
	 
	 	10.	 	The MLP will convey its interests in MCFS, CTP and Discovery to the OLLC as a
capital contribution.

-3-

 

	 	11.	 	The agreements of limited partnership and the limited liability company
agreements of the aforementioned entities will be amended and restated to the extent
necessary to reflect the applicable matters set forth above and in Article II and
Article III of this Agreement.

     NOW, THEREFORE, in consideration of their mutual undertakings and agreements hereunder, the
Parties undertake and agree as follows:

ARTICLE I

DEFINITIONS; RECORDATION

     1.1
Definitions. The following capitalized terms have the meanings given below.

     “Acts” shall mean collectively the Delaware Limited Partnership Act and the Delaware
LLC Act.

     “Agreement” means this Contribution, Conveyance and Assumption Agreement.

     “Amended and Restated Credit Agreement” means the Amended and Restated Credit
Agreement, dated as of May 20, 2005, by and among TWC, the MLP, Northwest Pipeline Corporation and
Transcontinental Gas Pipe Line Corporation, as the borrowers, the lenders named therein, Citicorp
USA, Inc., as administrative agent and collateral agent, Citibank, N.A. and Bank of America, N.A.,
as the issuing banks, Bank of America, N.A., as syndication agent, JPMorgan Chase Bank, N.A., the
Bank of Nova Scotia and The Royal Bank of Scotland PLC, as co-documentation agents, and Citigroup
Global Markets Inc. and Banc of America Securities LLC, as joint lead arrangers and co-book
runners.

     “Common Units” has the meaning assigned to such term in the Partnership Agreement.

     “CTP” has the meaning assigned to such term in Item 11 of the second Recital of this
Agreement.

     “CTP Aggregate Liabilities” shall mean, collectively, the CTP Liabilities and the CTP
Remaining Liabilities.

     “CTP Full Interest” shall mean, collectively, the CTP Interest and the CTP Remaining
Interest.

     “CTP Interest” has the meaning assigned to such term in Section 2.3.

     “CTP Liabilities” shall mean all liabilities and obligations relating to the CTP
Interest.

     “CTP Remaining Interest” has the meaning assigned to such term in Section 2.5.

     “CTP Remaining Liabilities” shall mean all liabilities and obligations relating to the
CTP Remaining Interest.

-4-

 

     “Delaware LLC Act” has the meaning assigned to such term in Item 5 of the second
Recital of this Agreement.

     “Delaware Limited Partnership Act” has the meaning assigned to such term in the
initial Recital of this Agreement.

     “Discovery” has the meaning assigned to such term in Item 5 of the third Recital of
this Agreement.

     “Discovery Aggregate Liabilities” shall mean, collectively, the WE Discovery
Liabilities and the Williams Pipeline Discovery Liabilities.

     “Discovery Interest” has the meaning assigned to such term in Section 2.12.

     “Effective Date” means August 23, 2005.

     “Effective Time” means the time when the transactions contemplated by Article II
hereof have been consummated.

     “Espagas” has the meaning assigned to such term in Item 3 of the second Recital of
this Agreement.

     “Gas Purchase Contract” shall mean that Base Contract for Sale and Purchase of Natural
Gas, dated August 15, 2005, between WNGL and Williams Power Company, Inc.

     “Gas Purchase Contract Liabilities” shall mean all liabilities and obligations
relating to the Gas Purchase Contract.

     “GP LLC” has the meaning assigned to such term in the first paragraph of this
Agreement.

     “Holdings” has the meaning assigned to such term in the first paragraph of this
Agreement.

     “Incentive Distribution Rights” has the meaning assigned to such term in the
Partnership Agreement.

     “Laws” means any and all laws, statutes, ordinances, rules or regulations promulgated
by a governmental authority, orders of a governmental authority, judicial decisions, decisions of
arbitrators or determinations of any governmental authority or court.

     “MAPCO” has the meaning assigned to such term in Item 4 of the second Recital of this
Agreement.

     “MCFS” has the meaning assigned to such term in Item 1 of the second Recital of this
Agreement.

     “MCFS Interest” has the meaning assigned to such term in Section 2.8.

-5-

 

     “MCFS Liabilities” shall mean all liabilities and obligations relating to the MCFS
Interest.

     “MLP” has the meaning assigned to such term in the first paragraph of this Agreement.

     “MLP Aggregate Interests” has the meaning assigned to such term in Section 2.12.

     “MLP Aggregate Liabilities” shall mean, collectively, the MCFS Liabilities, the CTP
Aggregate Liabilities and the Discovery Aggregate Liabilities.

     “Offering” means the initial public offering and transfer of title of 5,000,000 Common
Units by the MLP to the public.

     “Offering Proceeds” has the meaning assigned to such term in Item 8 of the third
Recital of this Agreement.

     “OLLC” has the meaning assigned to such term in the first paragraph of this Agreement.

     “Omnibus Agreement” means the Omnibus Agreement dated of even date herewith, among
WES, WE, Williams Pipeline, Holdings, GP LLC, the MLP, the OLLC, and, for purposes of Articles V
and VI thereof only, TWC.

     “Partnership Agreement” means the Agreement of Limited Partnership of the MLP, as it
may be amended and restated from time to time.

     “Partnership Group” has the meaning assigned to such term in the Omnibus Agreement.

     “Party and Parties” have the meanings assigned to such terms in the first paragraph of
this Agreement.

     “Registration Statement” means the registration statements on Form S-1 (File Nos.
333-124517 and 333-127655) filed by the MLP relating to the Offering.

     “Subordinated Units” has the meaning assigned to such term in the Partnership
Agreement.

     “TWC” has the meaning assigned to such term in the initial Recital of this Agreement.

     “WE” has the meaning assigned to such term in the first paragraph of this Agreement.

     “WE Discovery Interest” has the meaning assigned to such term in Item 5 of the third
Recital of this Agreement.

     “WE Discovery Liabilities” shall mean all liabilities and obligations relating to the
WE Discovery Interest.

     “WES” has the meaning assigned to such term in the first paragraph of this Agreement.

-6-

 

     “Williams Pipeline” has the meaning assigned to such term in the first paragraph of
this Agreement.

     “Williams Pipeline Discovery Interest” has the meaning assigned to such term in Item 6
of the third Recital of this Agreement.

     “Williams Pipeline Discovery Liabilities” shall mean all liabilities and obligations
relating to the Williams Pipeline Discovery Interest.

     “WMBPS” has the meaning assigned to such term in Item 11 of the second Recital of this
Agreement.

     “WMNGL” has the meaning assigned to such term in Item 1 of the second Recital of this
Agreement.

     “WNGL” has the meaning assigned to such term in the first paragraph of this Agreement.

ARTICLE II

THE OFFERING AND RELATED TRANSACTIONS

     2.1 Contribution of Gas Purchase Contract by WNGL to Holdings. WNGL hereby grants,
contributes, transfers, assigns and conveys to Holdings, its successor and assigns, for its and
their own use forever, all of its right, title and interest in and to the Gas Purchase Contract,
and Holdings hereby accepts the Gas Purchase Contract, subject to all matters to be contained in
the instruments of conveyance covering the Gas Purchase Contract to evidence such contribution and
conveyance, if any.

     TO HAVE AND TO HOLD the Gas Purchase Contract unto Holdings, its successors and assigns,
together with all and singular the rights and appurtenances thereto in anywise belonging, subject,
however, to the terms and conditions stated in this Agreement, and in such instruments of
conveyance, forever.

     2.2 Contribution of Gas Purchase Contract by Holdings to MCFS. Holdings hereby grants,
contributes, transfers, assigns and conveys to MCFS, its successor and assigns, for its and their
own use forever, all of its right, title and interest in and to the Gas Purchase Contract, and MCFS
hereby accepts the Gas Purchase Contract, subject to all matters to be contained in the instruments
of conveyance covering the Gas Purchase Contract to evidence such contribution and conveyance, if
any.

     TO HAVE AND TO HOLD the Gas Purchase Contract unto MCFS, its successors and assigns, together
with all and singular the rights and appurtenances thereto in anywise belonging, subject, however,
to the terms and conditions stated in this Agreement, and in such instruments of conveyance,
forever.

     2.3 Contribution by WES to GP LLC of an Interest in CTP. WES hereby grants, contributes, transfers, assigns and conveys to GP LLC, its successors
and assigns, for its and their own use forever, membership interests in CTP with an aggregate value
equal to 2% of the

-7-

 

equity value of the MLP at the closing of the Offering ($6.14 million) (the
“CTP Interest”), and GP LLC hereby accepts the CTP Interest.

     TO HAVE AND TO HOLD the CTP Interest unto GP LLC, its successors and assigns, together with
all and singular the rights and appurtenances thereto in anywise belonging, subject, however, to
the terms and conditions stated in this Agreement, forever.

     2.4 Contribution by GP LLC to the MLP of the CTP Interest. GP LLC hereby grants, contributes,
transfers, assigns and conveys to the MLP, its successors and assigns, for its and their own use
forever, all of the CTP Interest, and the MLP hereby accepts the CTP Interest as an additional
capital contribution in exchange for (a) a continuation of GP LLC’s 2% general partner interest in
the MLP and (b) the Incentive Distribution Rights.

     TO HAVE AND TO HOLD the CTP Interest unto the MLP, its successors and assigns, together with
all and singular the rights and appurtenances thereto in anywise belonging, subject, however, to
the terms and conditions stated in this Agreement, forever.

     2.5 Contribution by WES to the MLP of its Remaining Interest in CTP. WES hereby grants,
contributes, transfers, assigns and conveys to the MLP, its successors and assigns, for its and
their own use forever, all of its remaining membership interests in CTP (collectively, the “CTP
Remaining Interest”), and the MLP hereby accepts the CTP Remaining Interest as an additional
capital contribution in exchange for (a) 253,557 Common Units representing a 1.77% limited partner
interest in the MLP and (b) 887,450 Subordinated Units representing a 6.21% limited partner
interest in the MLP.

     TO HAVE AND TO HOLD the CTP Remaining Interest unto the MLP, its successors and assigns,
together with all and singular the rights and appurtenances thereto in anywise belonging, subject,
however, to the terms and conditions stated in this Agreement, forever.

     2.6 Contribution by WE to the MLP of an Interest in Discovery. WE hereby grants, contributes,
transfers, assigns and conveys to the MLP, its successors and assigns, for its and their own use
forever, the WE Discovery Interest, and the MLP hereby accepts the WE Discovery Interest as an
additional capital contribution in exchange for (a) 715,693 Common Units representing a 5.01%
limited partner interest in the MLP and (b) 2,504,925 Subordinated Units representing a 17.53%
limited partner interest in the MLP.

     TO HAVE AND TO HOLD the WE Discovery Interest unto the MLP, its successors and assigns,
together with all and singular the rights and appurtenances thereto in anywise belonging, subject,
however, to the terms and conditions stated in this Agreement, forever.

     2.7 Contribution by Williams Pipeline to the MLP of an Interest in Discovery. Williams Pipeline hereby grants, contributes, transfers, assigns and conveys to the MLP,
its successors and assigns, for its and their own use forever, the Williams Pipeline Discovery
Interest, and the MLP hereby accepts the Williams Pipeline Discovery Interest as an additional
capital contribution in exchange for (a) 345,567 Common Units representing a 2.42% limited partner
interest in the MLP and (b) 1,209,486 Subordinated Units representing a 8.47% limited partner
interest in the MLP.

-8-

 

     TO HAVE AND TO HOLD the Williams Pipeline Discovery Interest unto the MLP, its successors and
assigns, together with all and singular the rights and appurtenances thereto in anywise belonging,
subject, however, to the terms and conditions stated in this Agreement, forever.

     2.8 Contribution by Holdings to the MLP of All of Its Interests in MCFS. Holdings hereby
grants, contributes, transfers, assigns and conveys to the MLP, its successors and assigns, for its
and their own use forever, all of its right, title and interest in and to its 100% membership
interest in MCFS (the “MCFS Interest”), and the MLP hereby accepts the MCFS Interest as an
additional capital contribution in exchange for (a) 685,183 Common Units representing a 4.80%
limited partner interest in the MLP and (b) 2,398,139 Subordinated Units representing a 16.79%
limited partner interest in the MLP.

     TO HAVE AND TO HOLD the MCFS Interest unto the MLP, its successors and assigns, together with
all and singular the rights and appurtenances thereto in anywise belonging, subject, however, to
the terms and conditions stated in this Agreement, forever.

     2.9 Public Cash Contribution. The Parties acknowledge the cash contribution of the Offering
Proceeds from the public, through the underwriters, to the MLP in connection with the Offering in
exchange for 5,000,000 Common Units representing a 35.00% limited partner interest in the MLP.

     2.10 MLP Receipt of Cash Contribution. The MLP acknowledges receipt of the Offering Proceeds
in cash as a capital contribution to the MLP, and the Parties acknowledge that the MLP has used all
of such capital contribution to (a) pay the underwriting discounts and commissions and structuring
fees (which may be withheld by the underwriters from the Offering Proceeds as payment thereof), (b)
pay transaction costs estimated to be $4.3 million (excluding the underwriters’ discount and
commissions and structuring fees and net of a reimbursement for certain expenses received from the
underwriters), (c) provide $12.8 million of additional working capital, (d) distribute $35.0
million to Williams Pipeline to reimburse for certain capital expenditures incurred prior to
formation, (e) distribute $18.6 million to Holdings to reimburse for certain capital expenditures
incurred prior to formation and for the Gas Purchase Contract, (f) distribute $3.8 million to WE to
reimburse for certain capital expenditures incurred prior to formation, (g) distribute $1.3
million to WES to reimburse for certain capital expenditures incurred prior to formation and (h)
provide $24.4 million to make a capital contribution to Discovery to fund an escrow account in
connection with the Tahiti pipeline lateral expansion.

     2.11 MLP Cash Distribution to Holdings and Williams Pipeline. The Parties acknowledge the
distribution by the MLP of $35.0 million to Holdings, $18.6 million to Williams Pipeline, $3.8
million to WE and $1.3 million to WES, respectively, and the receipt by Holdings, Williams
Pipeline, WES and WE, respectively, of such amounts from the MLP. A portion of each of the above
distributions has been made to satisfy the reimbursement for capital expenditures of the above
respective parties.

     2.12 Conveyance and Contribution by the MLP to the OLLC of its Interests in MCFS, CTP and
Discovery. The MLP hereby grants, contributes, transfers, assigns and conveys to the OLLC, its
successors and assigns, for its and their own use forever, all of its right,

-9-

 

title and interest in and to (a) the MCFS Interest, (b) the CTP Full Interest and (c) its 40% membership interest in
Discovery (the “Discovery Interest” and, together with the MCFS Interest and the CTP Full
Interest, the “MLP Aggregate Interests”) and the OLLC hereby accepts the MLP Aggregate
Interests as an additional capital contribution.

     TO HAVE AND TO HOLD the MLP Aggregate Interests unto the OLLC, its successors and assigns,
together with all and singular the rights and appurtenances thereto in anywise belonging, subject,
however, to the terms and conditions stated in this Agreement, forever.

ARTICLE III

ASSUMPTION OF CERTAIN LIABILITIES

     3.1 Assumption of Gas Purchase Contract Liabilities by Holdings. In connection with the
contribution by WNGL of the Gas Purchase Contract to Holdings, as set forth in Section 2.1 above,
Holdings hereby assumes and agrees to duly and timely pay, perform and discharge all of the Gas
Purchase Contract Liabilities, to the full extent that WNGL has been heretofore or would have been
in the future obligated to pay, perform and discharge the Gas Purchase Contract Liabilities were it
not for the execution and delivery of this Agreement; provided, however, that said assumption and
agreement to duly and timely pay, perform and discharge the Gas Purchase Contract Liabilities shall
not (a) increase the obligation of Holdings with respect to the Gas Purchase Contract Liabilities
beyond that of WNGL, (b) waive any valid defense that was available to WNGL with respect to the Gas
Purchase Contract Liabilities or (c) enlarge any rights or remedies of any third party under any of
the Gas Purchase Contract Liabilities.

     3.2 Assumption of Gas Purchase Contract Liabilities by MCFS. In connection with the
contribution by Holdings of the Gas Purchase Contract to MCFS, as set forth in Section 2.2 above,
MCFS hereby assumes and agrees to duly and timely pay, perform and discharge all of the Gas
Purchase Contract Liabilities, to the full extent that Holdings has been heretofore or would have
been in the future obligated to pay, perform and discharge the Gas Purchase Contract Liabilities
were it not for the execution and delivery of this Agreement; provided, however, that said
assumption and agreement to duly and timely pay, perform and discharge the Gas Purchase Contract
Liabilities shall not (a) increase the obligation
of MCFS with respect to the Gas Purchase Contract Liabilities beyond that of Holdings, (b)
waive any valid defense that was available to Holdings with respect to the Gas Purchase Contract
Liabilities or (c) enlarge any rights or remedies of any third party under any of the Gas Purchase
Contract Liabilities.

     3.3 Assumption of CTP Liabilities by GP LLC. In connection with the contribution by WES of
the CTP Interest to GP LLC, as set forth in Section 2.3 above, GP LLC hereby assumes and agrees to
duly and timely pay, perform and discharge all of the CTP Liabilities, to the full extent that WES
has been heretofore or would have been in the future obligated to pay, perform and discharge the
CTP Liabilities were it not for the execution and delivery of this Agreement; provided, however,
that said assumption and agreement to duly and timely pay, perform and discharge the CTP
Liabilities shall not (a) increase the obligation of GP LLC with respect to the CTP Liabilities
beyond that of WES, (b) waive any valid defense that was available to WES with respect to the CTP
Liabilities or (c) enlarge any rights or remedies of any third party under any of the CTP
Liabilities.

-10-

 

     3.4 Assumption of CTP Liabilities by the MLP. In connection with the contribution by GP LLC
to the MLP of the CTP Interest as set forth in Section 2.4 above, the MLP hereby assumes and agrees
to duly and timely pay, perform and discharge all of the CTP Liabilities, to the full extent that
GP LLC has been heretofore or would have been in the future obligated to pay, perform and discharge
such obligations and liabilities were it not for the execution and delivery of this Agreement;
provided, however, that said assumption and agreement to duly and timely pay, perform and discharge
the CTP Liabilities shall not (a) increase the obligation of the MLP with respect to the CTP
Liabilities beyond that of GP LLC, (b) waive any valid defense that was available to GP LLC with
respect to the CTP Liabilities or (c) enlarge any rights or remedies of any third party under any
of the CTP Liabilities.

     3.5 Assumption of CTP Remaining Liabilities by the MLP. In connection with the contribution
by WES to the MLP of the CTP Remaining Interest as set forth in Section 2.5 above, the MLP hereby
assumes and agrees to duly and timely pay, perform and discharge all of the CTP Remaining
Liabilities, to the full extent that WES has been heretofore or would have been in the future
obligated to pay, perform and discharge such obligations and liabilities were it not for the
execution and delivery of this Agreement; provided, however, that said assumption and agreement to
duly and timely pay, perform and discharge the CTP Remaining Liabilities shall not (a) increase the
obligation of the MLP with respect to the CTP Remaining Liabilities beyond that of WES, (b) waive
any valid defense that was available to WES with respect to the CTP Remaining Liabilities or (c)
enlarge any rights or remedies of any third party under any of the CTP Remaining Liabilities.

     3.6 Assumption of WE Discovery Liabilities by the MLP. In connection with the contribution by
WE to the MLP of the WE Discovery Interest as set forth in Section 2.6 above, the MLP hereby
assumes and agrees to duly and timely pay, perform and discharge all of the WE Discovery
Liabilities, to the full extent that WE has been
heretofore or would have been in the future obligated to pay, perform and discharge such
obligations and liabilities were it not for the execution and delivery of this Agreement; provided,
however, that said assumption and agreement to duly and timely pay, perform and discharge the WE
Discovery Liabilities shall not (a) increase the obligation of the MLP with respect to the WE
Discovery Liabilities beyond that of WE, (b) waive any valid defense that was available to WE with
respect to the WE Discovery Liabilities or (c) enlarge any rights or remedies of any third party
under any of the WE Discovery Liabilities.

     3.7 Assumption of Williams Pipeline Discovery Liabilities by the MLP. In connection with the
contribution by Williams Pipeline to the MLP of the Williams Pipeline Discovery Interest as set
forth in Section 2.7 above, the MLP hereby assumes and agrees to duly and timely pay, perform and
discharge all of the Williams Pipeline Discovery Liabilities, to the full extent that Williams
Pipeline has been heretofore or would have been in the future obligated to pay, perform and
discharge such obligations and liabilities were it not for the execution and delivery of this
Agreement; provided, however, that said assumption and agreement to duly and timely pay, perform
and discharge the Williams Pipeline Discovery Liabilities shall not (a) increase the obligation of
the MLP with respect to the Williams Pipeline Discovery Liabilities beyond that of Williams
Pipeline, (b) waive any valid defense that was available to Williams Pipeline with respect to the
Williams Pipeline Discovery Liabilities or (c) enlarge any rights or remedies of any third party
under any of the Williams Pipeline Discovery Liabilities.

-11-

 

     3.8 Assumption of MCFS Liabilities by the MLP. In connection with the contribution by
Holdings to the MLP of the MCFS Interest as set forth in Section 2.8 above, the MLP hereby assumes
and agrees to duly and timely pay, perform and discharge all of the MCFS Liabilities, to the full
extent that Holdings has been heretofore or would have been in the future obligated to pay, perform
and discharge such obligations and liabilities were it not for the execution and delivery of this
Agreement; provided, however, that said assumption and agreement to duly and timely pay, perform
and discharge the MCFS Liabilities shall not (a) increase the obligation of the MLP with respect to
the MCFS Liabilities beyond that of Holdings, (b) waive any valid defense that was available to
Holdings with respect to the MCFS Liabilities or (c) enlarge any rights or remedies of any third
party under any of the MCFS Liabilities.

     3.9 Assumption of MLP Aggregate Liabilities by the OLLC. In connection with the contribution
by the MLP to the OLLC of the MLP Aggregate Interests as set forth in Section 2.12 above, the OLLC
hereby assumes and agrees to duly and timely pay, perform and discharge all of the MLP Aggregate
Liabilities, to the full extent that the MLP has been heretofore or would have been in the future
obligated to pay, perform and discharge such obligations and liabilities were it not for the
execution and delivery of this Agreement; provided, however, that said assumption and agreement to
duly and timely pay, perform and discharge the MLP Aggregate Liabilities shall not (a) increase the
obligation of the OLLC with respect to the MLP Aggregate Liabilities beyond that of the MLP, (b)
waive any
valid defense that was available to the MLP with respect to the MLP Aggregate Liabilities or
(c) enlarge any rights or remedies of any third party under any of the MLP Aggregate Liabilities.

     3.10 General Provisions Relating to Assumption of Liabilities. Notwithstanding anything to
the contrary contained in this Agreement including, without limitation, the terms and provisions of
this Article III, none of the Parties shall be deemed to have assumed, and none of the interests
have been or are being contributed subject to, any liens or security interests securing consensual
indebtedness covering any of the interests, and all such liens and security interests shall be
deemed to be excluded from the assumptions of liabilities made under this Article III.

ARTICLE IV

FURTHER ASSURANCES

     4.1 Further Assurances. From time to time after the date hereof, and without any further
consideration, the Parties agree to execute, acknowledge and deliver all such additional deeds,
assignments, bills of sale, conveyances, instruments, notices, releases, acquittances and other
documents, and will do all such other acts and things, all in accordance with applicable law, as
may be necessary or appropriate (a) more fully to assure that the applicable Parties own all of the
properties, rights, titles, interests, estates, remedies, powers and privileges granted by this
Agreement, or which are intended to be so granted, (b) more fully and effectively to vest in the
applicable Parties and their respective successors and assigns beneficial and record title to the
interests contributed and assigned by this Agreement or intended so to be and (c) to more fully and
effectively carry out the purposes and intent of this Agreement.

     4.2 Other Assurances. From time to time after the date hereof, and without any further
consideration, each of the Parties shall execute, acknowledge and deliver all such additional
instruments, notices and other documents, and will do all such other acts and things,

-12-

 

all in accordance with applicable law, as may be necessary or appropriate to more fully and effectively
carry out the purposes and intent of this Agreement. It is the express intent of the Parties that
the MLP or its subsidiaries own all assets necessary to operate the assets that are identified in
this Agreement and in the Registration Statement. To the extent any assets were not identified but
are necessary to the operation of assets that were identified, then the intent of the Parties is
that all such unidentified assets are intended to be conveyed to the appropriate members of the
Partnership Group. To the extent such assets are identified at a later date, the Parties shall
take the appropriate actions required in order to convey all such assets to the appropriate members
of the Partnership Group. Likewise, to the extent that assets are identified at a later date that
were not intended by the parties to be conveyed as reflected in the Registration Statement, the
Parties take the appropriate actions required in order to convey all such assets to the appropriate
party.

ARTICLE V

MISCELLANEOUS

     5.1 Order of Completion of Transactions. The transactions provided for in Article II and
Article III of this Agreement shall be completed on the Effective Date in the following order:

     First, the transactions provided for in Article II shall be completed in the order set
forth therein; and

     Second, the transactions provided for in Article III shall be completed in the order
set forth therein.

     5.2 Costs. The OLLC shall pay all sales, use and similar taxes arising out of the
contributions, conveyances and deliveries to be made hereunder, and shall pay all documentary,
filing, recording, transfer, deed, and conveyance taxes and fees required in connection therewith.

     5.3 Headings; References; Interpretation. All Article and Section headings in this Agreement
are for convenience only and shall not be deemed to control or affect the meaning or construction
of any of the provisions hereof. The words “hereof,” “herein” and “hereunder” and words of similar
import, when used in this Agreement, shall refer to this Agreement as a whole and not to any
particular provision of this Agreement. All references herein to Articles and Sections shall,
unless the context requires a different construction, be deemed to be references to the Articles
and Sections of this Agreement, respectively. All personal pronouns used in this Agreement,
whether used in the masculine, feminine or neuter gender, shall include all other genders, and the
singular shall include the plural and vice versa. The use herein of the word “including” following
any general statement, term or matter shall not be construed to limit such statement, term or
matter to the specific items or matters set forth immediately following such word or to similar
items or matters, whether or not non-limiting language (such as “without limitation,” “but not
limited to,” or words of similar import) is used with reference thereto, but rather shall be deemed
to refer to all other items or matters that could reasonably fall within the broadest possible
scope of such general statement, term or matter.

-13-

 

     5.4 Successors and Assigns. The Agreement shall be binding upon and inure to the benefit of
the parties signatory hereto and their respective successors and assigns.

     5.5 No Third Party Rights. The provisions of this Agreement are intended to bind the parties
signatory hereto as to each other and are not intended to and do not create rights in any other
person or confer upon any
other person any benefits, rights or remedies and no person is or is intended to be a third
party beneficiary of any of the provisions of this Agreement.

     5.6 Counterparts. This Agreement may be executed in any number of counterparts, all of which
together shall constitute one agreement binding on the parties hereto.

     5.7 Governing Law. This Agreement shall be governed by, and construed in accordance with, the
laws of the State of Texas applicable to contracts made and to be performed wholly within such
state without giving effect to conflict of law principles thereof, except to the extent that it is
mandatory that the law of some other jurisdiction, wherein the interests are located, shall apply.

     5.8 Severability. If any of the provisions of this Agreement are held by any court of
competent jurisdiction to contravene, or to be invalid under, the laws of any political body having
jurisdiction over the subject matter hereof, such contravention or invalidity shall not invalidate
the entire Agreement. Instead, this Agreement shall be construed as if it did not contain the
particular provision or provisions held to be invalid, and an equitable adjustment shall be made
and necessary provision added so as to give effect to the intention of the Parties as expressed in
this Agreement at the time of execution of this Agreement.

     5.9 Amendment or Modification. This Agreement may be amended or modified from time to time
only by the written agreement of all the Parties hereto and affected thereby.

     5.10 Integration. This Agreement and the instruments referenced herein supersede all previous
understandings or agreements among the Parties, whether oral or written, with respect to its
subject matter. This Agreement and such instruments contain the entire understanding of the
Parties with respect to the subject matter hereof and thereof. No understanding, representation,
promise or agreement, whether oral or written, is intended to be or shall be included in or form
part of this Agreement unless it is contained in a written amendment hereto executed by the Parties
hereto after the date of this Agreement.

-14-

 

     IN WITNESS WHEREOF, this Agreement has been duly executed by the parties hereto as of the date
first above written.

	 	 	 	 	 	 	 
	 	 	WILLIAMS ENERGY SERVICES, LLC,

a Delaware limited liability company	 	 
	 
	 	 	 	 	 	 
	 

	 	By:
	 	/s/ Alan S. Armstrong	 	 
	 

	 	 	 	 	 	 
	 	 	Name: Alan S. Armstrong	 	 
	 	 	Title: Senior Vice President	 	 
	 
	 	 	 	 	 	 
	 

	 	 	 	 “WES”	 	 
	 
	 	 	 	 	 	 
	 	 	WILLIAMS PARTNERS GP LLC,

a Delaware limited liability company	 	 
	 
	 	 	 	 	 	 
	 

	 	By:
	 	/s/ Alan S. Armstrong	 	 
	 

	 	 	 	 	 	 
	 	 	Name: Alan S. Armstrong	 	 
	 	 	Title: Chief Operating Officer	 	 
	 
	 	 	 	 	 	 
	 

	 	 	 	 “GP LLC”	 	 
	 
	 	 	 	 	 	 
	 	 	WILLIAMS PARTNERS L.P.,

a Delaware limited partnership	 	 
	 
	 	 	 	 	 	 
	 	 	By: Williams Partners GP LLC, its general partner	 	 
	 
	 	 	 	 	 	 
	 

	 	By:
	 	/s/ Alan S. Armstrong	 	 
	 

	 	 	 	 	 	 
	 	 	Name: Alan S. Armstrong	 	 
	 	 	Title: Chief Operating Officer	 	 
	 
	 	 	 	 	 	 
	 

	 	 	 	 “MLP”	 	 

 

 

	 	 	 	 	 	 	 
	 	 	WILLIAMS PARTNERS OPERATING LLC,

a Delaware limited liability company	 	 
	 
	 	 	 	 	 	 
	 	 	By: WILLIAMS PARTNERS L.P., its sole member	 	 
	 
	 	 	 	 	 	 
	 	 	By: Williams Partners GP LLC, its general partner	 	 
	 
	 	 	 	 	 	 
	 

	 	By:
	 	/s/ Alan S. Armstrong	 	 
	 

	 	 	 	 	 	 
	 	 	Name: Alan S. Armstrong	 	 
	 	 	Title: Chief Operating Officer	 	 
	 
	 	 	 	 	 	 
	 

	 	 	 	 “OLLC”	 	 
	 
	 	 	 	 	 	 
	 	 	WILLIAMS ENERGY, L.L.C.,

a Delaware limited liability company	 	 
	 
	 	 	 	 	 	 
	 

	 	By:
	 	/s/ Alan S. Armstrong	 	 
	 

	 	 	 	 	 	 
	 	 	Name: Alan S. Armstrong	 	 
	 	 	Title: Senior Vice President and General
Manager – Business 

          Development
	 
	 	 	 	 	 	 
	 

	 	 	 	 “WE”	 	 
	 
	 	 	 	 	 	 
	 	 	WILLIAMS DISCOVERY PIPELINE LLC,

a Delaware limited liability company	 	 
	 
	 	 	 	 	 	 
	 

	 	By:
	 	/s/ Alan S. Armstrong	 	 
	 

	 	 	 	 	 	 
	 	 	Name: Alan S. Armstrong	 	 
	 	 	Title: Senior Vice President and General Manager	 	 
	 
	 	 	 	 	 	 
	 

	 	 	 	 “Williams Pipeline”	 	 

 

 

	 	 	 	 	 	 	 
	 	 	WILLIAMS PARTNERS HOLDINGS LLC,

a Delaware limited liability company	 	 
	 
	 	 	 	 	 	 
	 

	 	By:
	 	/s/ Alan S. Armstrong	 	 
	 

	 	 	 	 	 	 
	 	 	Name: Alan S. Armstrong	 	 
	 	 	Title: Chief Operating Officer	 	 
	 
	 	 	 	 	 	 
	 

	 	 	 	 “Holdings”	 	 
	 
	 	 	 	 	 	 
	 	 	WILLIAMS NATURAL GAS LIQUIDS, INC.,

a Delaware corporation	 	 
	 
	 	 	 	 	 	 
	 

	 	By:
	 	/s/ Alan S. Armstrong	 	 
	 

	 	 	 	 	 	 
	 	 	Name: Alan S. Armstrong	 	 
	 	 	Title: Senior Vice President and General Manager	 	 
	 
	 	 	 	 	 	 
	 

	 	 	 	“WNGL”

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