Document:

EXHIBIT 10.21

 

 

CREDIT AGREEMENT

 

 

PLAINS MARKETING, L.P., as Borrower,

 

 

FLEET NATIONAL BANK, as Administrative Agent,

 

 

FLEET SECURITIES, INC., as Lead Arranger and Book Manager,

 

 

and CERTAIN FINANCIAL INSTITUTIONS, as Lenders

 

 

$200,000,000 Uncommited Senior Secured

Discretionary Contango Facility

 

 

November 21, 2003

 

 

 

 

 

TABLE OF CONTENTS

 

	
  ARTICLE
  I - Definitions and References

  	
   

  
	
   

  	
  Section
  1.1.  Defined Terms

  	
   

  
	
   

  	
  Section
  1.2.  Exhibits and Schedules;
  Additional Definitions

  	
   

  
	
   

  	
  Section
  1.3.  Amendment of Defined Instruments

  	
   

  
	
   

  	
  Section
  1.4.  References and Titles

  	
   

  
	
   

  	
  Section
  1.5.  Calculations and Determinations

  	
   

  
	
   

  	
   

  	
   

  
	
  ARTICLE II - Loans and Letters of Credit

  	
   

  
	
   

  	
  Section
  2.1.  Financing Requests, Commitments
  and Fundings

  	
   

  
	
   

  	
  Section
  2.2.  Loans and Notes

  	
   

  
	
   

  	
  Section
  2.3.  Requests for Loans

  	
   

  
	
   

  	
  Section
  2.4.  Continuations and Conversions of
  Existing Loans

  	
   

  
	
   

  	
  Section
  2.5.  Use of Proceeds

  	
   

  
	
   

  	
  Section
  2.6.  Interest Rates and Fees

  	
   

  
	
   

  	
  Section
  2.7.  Optional Prepayments

  	
   

  
	
   

  	
  Section
  2.8.  Mandatory Prepayments and
  Payments

  	
   

  
	
   

  	
  Section
  2.9.  Extension of Request Period.

  	
   

  
	
   

  	
  Section
  2.10.  Letters of Credit

  	
   

  
	
   

  	
  Section
  2.11.  Requesting Letters of Credit

  	
   

  
	
   

  	
  Section
  2.12.  Reimbursement and
  Participations

  	
   

  
	
   

  	
  Section
  2.13.  Letter of Credit Fees

  	
   

  
	
   

  	
  Section
  2.14.  No Duty to Inquire

  	
   

  
	
   

  	
   

  	
   

  
	
  ARTICLE
  III - Payments to Lenders

  	
   

  
	
   

  	
  Section
  3.1.  General Procedures

  	
   

  
	
   

  	
  Section
  3.2.  Capital Reimbursement

  	
   

  
	
   

  	
  Section
  3.3.  Increased Cost of LIBOR Loans or
  Letters of Credit

  	
   

  
	
   

  	
  Section
  3.4.  Notice; Change of Applicable
  Lending Office

  	
   

  
	
   

  	
  Section
  3.5.  Availability

  	
   

  
	
   

  	
  Section
  3.6.  Funding Losses

  	
   

  
	
   

  	
  Section
  3.7.  Reimbursable Taxes

  	
   

  
	
   

  	
  Section 3.8.  Replacement of Lenders.

  	
   

  
	
   

  	
   

  	
   

  
	
  ARTICLE IV - Conditions Precedent to
  Lending

  	
   

  
	
   

  	
  Section
  4.1.  Documents to be Delivered

  	
   

  
	
   

  	
  Section
  4.2.  Additional Conditions Precedent

  	
   

  
	
   

  	
   

  	
   

  
	
  ARTICLE V - Representations and Warranties

  	
   

  
	
   

  	
  Section
  5.1.  No Default

  	
   

  
	
   

  	
  Section
  5.2.  Organization and Good Standing

  	
   

  
	
   

  	
  Section
  5.3.  Authorization

  	
   

  
	
   

  	
  Section
  5.4.  No Conflicts or Consents

  	
   

  
	
   

  	
  Section
  5.5.  Enforceable Obligations

  	
   

  

 

i

 

	
   

  	
  Section
  5.6.  Initial Financial Statements

  	
   

  
	
   

  	
  Section
  5.7.  Other Obligations and
  Restrictions.

  	
   

  
	
   

  	
  Section
  5.8.  Full Disclosure

  	
   

  
	
   

  	
  Section
  5.9.  Litigation

  	
   

  
	
   

  	
  Section
  5.10.  ERISA Plans and Liabilities

  	
   

  
	
   

  	
  Section
  5.11.  Compliance with Permits,
  Consents and Law

  	
   

  
	
   

  	
  Section
  5.12.  Environmental Laws

  	
   

  
	
   

  	
  Section
  5.13.  Accounts; Title to Properties

  	
   

  
	
   

  	
  Section
  5.14.  Government Regulation

  	
   

  
	
   

  	
  Section
  5.15.  Insider

  	
   

  
	
   

  	
  Section
  5.16.  Solvency

  	
   

  
	
   

  	
   

  	
   

  
	
  ARTICLE VI - Affirmative Covenants

  	
   

  
	
   

  	
  Section
  6.1.  Payment and Performance

  	
   

  
	
   

  	
  Section
  6.2.  Books, Financial Statements and
  Reports.

  	
   

  
	
   

  	
  Section
  6.3.  Other Information and
  Inspections

  	
   

  
	
   

  	
  Section
  6.4.  Notice of Material Events

  	
   

  
	
   

  	
  Section
  6.5.  Maintenance of Existence,
  Qualifications and Assets

  	
   

  
	
   

  	
  Section
  6.6.  Payment of Taxes, etc.

  	
   

  
	
   

  	
  Section
  6.7.  Insurance

  	
   

  
	
   

  	
  Section
  6.8.  Compliance with Agreements and
  Law

  	
   

  
	
   

  	
  Section
  6.9.  Agreement to Deliver Security
  Documents

  	
   

  
	
   

  	
  Section
  6.10.  Perfection and Protection of
  Security Interests and Liens

  	
   

  
	
   

  	
   

  	
   

  
	
  ARTICLE VII - Negative Covenants

  	
   

  
	
   

  	
  Section
  7.1.  Limitation on Liens

  	
   

  
	
   

  	
  Section
  7.2.  Limitation on Mergers

  	
   

  
	
   

  	
  Section
  7.3.  Limitation on Sales of
  Collateral

  	
   

  
	
   

  	
  Section
  7.4.  Limitation on New Businesses

  	
   

  
	
   

  	
  Section
  7.5.  No Negative Pledges

  	
   

  
	
   

  	
   

  	
   

  
	
  ARTICLE VIII - Events of Default and
  Remedies

  	
   

  
	
   

  	
  Section
  8.1.  Events of Default

  	
   

  
	
   

  	
  Section
  8.2.  Remedies

  	
   

  
	
   

  	
   

  	
   

  
	
  ARTICLE IX - Administrative Agent

  	
   

  
	
   

  	
  Section
  9.1.  Appointment and Authority

  	
   

  
	
   

  	
  Section
  9.2.  Exculpation, Administrative
  Agent’s Reliance, Etc.

  	
   

  
	
   

  	
  Section
  9.3.  Credit Decisions

  	
   

  
	
   

  	
  Section
  9.4.  Indemnification

  	
   

  
	
   

  	
  Section
  9.5.  Rights as Lender

  	
   

  
	
   

  	
  Section
  9.6.  Sharing of Set-Offs and Other
  Payments

  	
   

  
	
   

  	
  Section
  9.7.  Investments

  	
   

  
	
   

  	
  Section
  9.8.  Benefit of Article IX

  	
   

  
	
   

  	
  Section
  9.9.  Resignation

  	
   

  

 

ii

 

	
  ARTICLE
  X - Miscellaneous

  	
   

  
	
   

  	
  Section
  10.1.  Waivers and Amendments;
  Acknowledgments

  	
   

  
	
   

  	
  Section
  10.2.  Survival of Agreements;
  Cumulative Nature

  	
   

  
	
   

  	
  Section
  10.3.  Notices

  	
   

  
	
   

  	
  Section
  10.4.  Payment of Expenses; Indemnity

  	
   

  
	
   

  	
  Section
  10.5.  Parties in Interest;
  Assignments; Replacement Notes

  	
   

  
	
   

  	
  Section
  10.6.  Confidentiality

  	
   

  
	
   

  	
  Section
  10.7.  Governing Law; Submission to
  Process

  	
   

  
	
   

  	
  Section
  10.8.  Limitation on Interest

  	
   

  
	
   

  	
  Section
  10.9.  Right of Offset

  	
   

  
	
   

  	
  Section
  10.10.  Termination; Limited Survival

  	
   

  
	
   

  	
  Section
  10.11.  Severability

  	
   

  
	
   

  	
  Section
  10.12.  Counterparts

  	
   

  
	
   

  	
  Section
  10.13.  Waiver of Jury Trial, Punitive
  Damages, etc.

  	
   

  
	
   

  	
  Section
  10.14.  Replacement Credit Facility

  	
   

  

 

iii

 

	
  Schedules
  and Exhibits:

  	
   

  
	
   

  	
   

  	
   

  
	
  Schedule 1 - Lender Schedule

  	
   

  
	
  Schedule 2 -
  Disclosure Schedule

  	
   

  
	
  Schedule 3 - Security Schedule

  	
   

  
	
  Schedule 4 - Pricing Grid

  	
   

  
	
  Schedule 5 - Currently Approved Persons and
  Facilities

  	
   

  
	
   

  	
   

  	
   

  
	
  Exhibit A - Note

  	
   

  
	
  Exhibit
  B-1 - Financing Request-Initial

  	
   

  
	
  Exhibit
  B-2 - Financing Request-Final

  	
   

  
	
  Exhibit
  B-3 - Borrowing Notice

  	
   

  
	
  Exhibit C - Continuation/Conversion Notice

  	
   

  
	
  Exhibit
  D-1 - Opinion of In-House Counsel for Borrower

  	
   

  
	
  Exhibit
  D-2 - Opinion of Fulbright & Jaworski L.L.P., Counsel for Borrower

  	
   

  
	
  Exhibit E - Form of Letter of Credit

  	
   

  
	
  Exhibit F - Letter of Credit Application
  and Agreement

  	
   

  
	
  Exhibit G - Assignment and Acceptance
  Agreement

  	
   

  

 

iv

 

CREDIT AGREEMENT

 

 

THIS CREDIT
AGREEMENT is made as of November 21, 2003, by and among PLAINS MARKETING, L.P.,
a Delaware limited partnership (“Borrower”), FLEET NATIONAL BANK, as
administrative agent (in such capacity, “Administrative Agent”), FLEET
SECURITIES, INC., as lead arranger and book manager (in such capacity, “Lead
Arranger and Book Manager”) and the Lenders referred to below.  In consideration of the mutual covenants and
agreements contained herein the parties hereto agree as follows:

 

W I T N E S S E T H

 

In
consideration of the mutual covenants and agreements contained herein and in
consideration of the loans which may hereafter by made by Lenders, in each Lender’s sole and absolute discretion,
and the Letters of Credit which may be made available by LC Issuer to Borrower
upon Lenders’ election to participate in such Letters of Credit, in each Lender’s sole and absolute discretion,
and for other good and valuable consideration, the receipt and sufficiency of
which are hereby acknowledged, the parties hereto agree as follows:

 

ARTICLE I
- Definitions and References 

 

Section 1.1.  Defined Terms.  As used in this Agreement, each of the
following terms has the meaning given to such term in this Section 1.1 or in
the sections and subsections referred to below:

 

“Account”
shall have the meaning given that term in the UCC.

 

“Account Debtor”
means any Person who is or who may become obligated under, with respect to, or
on account of, an Account.

 

“Administrative
Agent” means Fleet National Bank, as Administrative Agent hereunder, and
its successors in such capacity.

 

“Affiliate”
means, as to any Person, each other Person that directly or indirectly (through
one or more intermediaries or otherwise) controls, is controlled by, or is
under common control with, such Person. 
A Person shall be deemed to be “controlled by” any other Person if such
other Person possesses, directly or indirectly, power to direct or cause the
direction of the management and policies of such Person whether by contract or
otherwise.

 

“Agreement”
means this Credit Agreement.

 

“Applicable
Lending Office” means, for each Lender and for each Type of Loan, the
“Lending Office” of such Lender (or of an Affiliate of such Lender) designated
for such Type of Loan on the Lender Schedule or such other office of such
Lender (or an Affiliate of such Lender) as such Lender may from time to time
specify to Administrative Agent and Borrower by written 

 

 

notice in accordance with the terms hereof as the office by which its
Loans of such Type are to be made and maintained.

 

“Applicable
Margin” means, as to any Type of Loan, 
the percent per annum set forth on the Pricing Grid as the “Applicable
Margin” for such Type of Loan, based on the Applicable Rating Level in effect
on such date.  Changes in the Applicable
Margin will occur automatically without prior notice as changes in the Applicable
Rating Level occur.  Administrative
Agent will give notice promptly to Borrower and Lenders of changes in the
Applicable Margin.

 

“Applicable
Rating Level” means for any day, the level set forth below that corresponds
to the PAA Debt Rating by the Ratings Agencies applicable on such day; provided,
in the event the PAA Debt Rating by the Ratings Agencies differs by one level,
the higher PAA Debt Rating shall apply; provided  further, in the
event the PAA Debt Rating by the Ratings Agencies differs by more than one
level, the PAA Debt Rating one level above the lower PAA Debt Rating shall
apply; provided, notwithstanding the foregoing, the Applicable Rating
Level for the period from the date hereof through and including February 21,
2004 shall be Level III.  As used in
this definition, “ >“ means a rating equal to or more favorable than
and “<“ means a rating less favorable than.

 

	
  Rating
  Level

  	
   

  	
  S&P

  	
   

  	
  Moody’s

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Level I

  	
   

  	
  > BBB+

  	
   

  	
  > Baa1

  	
   

  
	
  Level II

  	
   

  	
  BBB

  	
   

  	
  Baa2

  	
   

  
	
  Level III

  	
   

  	
  BBB-

  	
   

  	
  Baa3

  	
   

  
	
  Level IV

  	
   

  	
  < BBB-

  	
   

  	
  < Baa3

  	
   

  

 

If either of the Rating
Agencies shall not have in effect a PAA Debt Rating or if the rating system of
either of the Rating Agencies shall change, or if either of the Rating Agencies
shall cease to be in the business of rating corporate debt obligations,
Borrower and Majority Lenders shall negotiate in good faith to amend this
definition to reflect such changed rating system or the unavailability of
ratings from such Rating Agency, but until such an agreement shall be reached,
the Applicable Rating Level shall be based only upon the PAA Debt Rating by the
remaining Rating Agency.

 

“Approved
Eligible Receivables” means an Eligible Receivable (a) from a Person whose
Debt Rating is either at least Baa3 by Moody’s or at least BBB- by S&P; (b) fully
and unconditionally guaranteed as to payment by a Person whose Debt Rating is
either at least Baa3 by Moody’s or at least BBB- by S&P; (c) from any other
Person Currently Approved by Majority Lenders; or (d) fully covered by a letter
of credit from any national or state bank or trust company which is organized
under the laws of the United States of America or any state thereof or any
branch licensed to operate under the laws of the United States of America or
any state thereof, which is a branch of a bank organized under any country
which is a member of the Organization 

 

2

 

for Economic Cooperation and Development, in each case which has
capital, surplus and undivided profits of at least $500,000,000 and whose
commercial paper is rated at least P-1 by Moody’s or A-1 by S&P.

 

“Approved
Location” means (i) a Plains Terminal, (ii) storage locations or pipelines
Currently Approved by Majority Lenders for which Administrative Agent has
received a bailee letter in form and substance reasonably acceptable to
Administrative Agent with respect to any Collateral stored at such locations or
pipelines, or (iii) storage locations or pipelines Currently Approved by
Majority Lenders storing Financed Hedged Eligible Inventory not in excess of
five percent (5%) of all Financed Hedged Eligible Inventory.

 

“Base Rate”
means the higher of (i) the variable per annum rate of interest so designated
from time to time by Administrative Agent as its “prime rate”, or (ii) the Federal
Funds Rate plus one-half percent (0.5%) per annum.  The “prime rate” is a reference rate and does not necessarily
represent the lowest or best rate being charged to any customer.  Changes in the Base Rate resulting from
changes in the “prime rate” shall take place immediately without notice or
demand of any kind.

 

“Base Rate
Loan” means a Loan to Borrower which does not bear interest at a rate based
upon the LIBOR Rate.

 

“Borrower”
means Plains Marketing, L.P., a Delaware limited partnership.

 

“Borrowing”
means a borrowing of new Loans of a single Type pursuant to Section 2.3 or a
Continuation or Conversion of existing Loans into a single Type (and, in the
case of LIBOR Loans, with the same Interest Period) pursuant to Section 2.4.

 

“Borrowing
Notice” means a written or telephonic request, or a written confirmation,
made by a Borrower which meets the requirements of Section 2.3.

 

“Broker
Liens” means any Liens under or with respect to accounts with brokers or
counterparties with respect to Hedging Contracts in favor of such brokers or
counterparties, securing only obligations under such Hedging Contracts.

 

“Business
Day” means any day, other than a Saturday, Sunday or day which shall be in
the Commonwealth of Massachusetts a legal holiday or day on which banking
institutions are required or authorized to close.  Any Business Day in any way relating to LIBOR Loans (such as the
day on which an Interest Period begins or ends) must also be a day on which
commercial banks settle payments in London.

 

“Cash and
Carry Purchases” means purchases of Petroleum Products for physical storage
at an Approved Location which qualify as Hedged Eligible Inventory.

 

“Cash
Equivalents” means Investments in:

 

3

 

(a)  marketable obligations, maturing within 12
months after acquisition thereof, issued or unconditionally guaranteed by the
United States of America or the federal government of Canada or an
instrumentality or agency thereof and entitled to the full faith and credit of the
United States of America or the federal government of Canada, as the case may
be;

 

(b)  demand deposits and time deposits (including
certificates of deposit) maturing within 12 months from the date of deposit
thereof, (i) with any office of any Lender or (ii) with a domestic office
of any national, state or provincial bank or trust company which is organized
under the Laws of the United States of America or any state therein, or the
federal government of Canada or any province therein, which has capital,
surplus and undivided profits of at least $500,000,000, and whose long term
certificates of deposit are rated at least Aa3 by Moody’s or AA- by S&P;

 

(c) repurchase
obligations with a term of not more than seven days for underlying securities
of the types described in subsection (a) above entered into with (i) any Lender
or (ii) any other commercial bank meeting the specifications of subsection (b)
above;

 

(d)  open market commercial paper, maturing
within 270 days after acquisition thereof, which are rated at least P-1 by
Moody’s or A-1 by S&P; and

 

(e)  money market or other mutual funds
substantially all of whose assets comprise securities of the types described in
subsections (a) through (d) above.

 

“Change of
Control” means PAA shall cease to be, directly or indirectly, the sole
legal and beneficial owner (within the meaning of Rule 13d-3 under the
Securities Exchange Act of 1934, as amended) of all of the partnership
interests (including all securities which are convertible into partnership
interests) of Borrower.

 

“Code”
means the Internal Revenue Code of 1986, as amended from time to time, together
with all rules and regulations promulgated with respect thereto.

 

“Collateral”
means all property of any kind which is subject to a Lien in favor of Lenders
(or in favor of Administrative Agent for the benefit of Lenders) or which,
under the terms of any Security Document, is purported to be subject to such a
Lien, in each case granted or created to secure all or part of the Obligations.

 

“Consolidated”
refers to the consolidation of any Person, in accordance with GAAP, with its
properly consolidated subsidiaries. 
References herein to a Person’s Consolidated financial statements,
financial position, financial condition, liabilities, etc. refer to the consolidated
financial statements, financial position, financial condition, liabilities,
etc. of such Person and its properly consolidated subsidiaries.

 

“Continue”,
“Continuation” and “Continued” shall refer to the continuation
pursuant to Section 2.4 of a LIBOR Loan as a LIBOR Loan from one Interest
Period to the next Interest Period.

 

4

 

“Continuation/Conversion
Notice” means a written or telephonic request, or a written confirmation,
made by Borrower which meets the requirements of Section 2.4.

 

“Convert,
“Conversion” and “Convert” refers to a conversion pursuant to
Section 2.4 of one Type of Loan into another Type of Loan.

 

“Currently
Approved by Majority Lenders” means such Person (including a limit on the
maximum Hedged Eligible Inventory sold to any such Person), storage location,
pipeline, form of Letter of Credit or other matter as the case may be, as
reflected in Schedule 5 attached hereto and as amended from time to time by the
most recent written notice given by Administrative Agent to Borrower as being
approved by Majority Lenders.  Each such
amended Schedule 5 will supersede and revoke each prior Schedule 5.

 

“Default” means any Event of Default
and any default, event or condition which would, with the giving of any
requisite notices and the passage of any requisite periods of time, constitute
an Event of Default.

 

“Default
Rate” means, at the time in question, two percent (2%) per annum plus:

 

(a)  the LIBOR Rate plus the
Applicable Margin then in effect for each LIBOR Loan (up to the end of the
applicable Interest Period),

 

(b)  the Base Rate plus the
Applicable Margin then in effect for each Base Rate Loan,

 

provided, however, the Default
Rate shall never exceed the Highest Lawful Rate.

 

“Default
Rate Period” means (i) any period during which an Event of Default, other
than pursuant to Section 8.1 (a) or (b), is continuing, provided that such
period shall not begin until notice of the commencement of the Default Rate has
been given to Borrower by Administrative Agent upon the instruction by Majority
Lenders and (ii) any period during which any Event of Default pursuant to
Section 8.1 (a) or (b) is continuing unless Borrower has been notified
otherwise by Administrative Agent upon the instruction by Majority Lenders.

 

“Delivery
Month” has the meaning given to such term in Section 2.1(a).

 

“Disclosure
Schedule” means Schedule 2 hereto.

 

“Dollars”
and “$” means the lawful currency of the United States of America,
except where otherwise specified.

 

“Eligible Inventory”
means inventories of Petroleum Products in which Borrower has lawful and
absolute title (specifically excluding, however, tank bottoms and pipeline
linefill of Borrower classified as a long-term asset), which are not subject to
any Lien in favor of any Person (other than Permitted Inventory Liens), which
are subject to a fully perfected first priority security interest (subject only
to Permitted Inventory Liens) in favor of Administrative Agent pursuant to the
Loan Documents prior to the rights of, and enforceable as such against, any
other 

 

5

 

Person, which are otherwise satisfactory to Majority Lenders in their
reasonable business judgment and located at Approved Locations, minus without duplication the amount of
any Permitted Inventory Lien on any such inventory.

 

“Eligible
Receivables” means, at the time of any determination thereof (and without
duplication), each Account and, with respect to each determination made on or
after the 20th day of each calendar month and prior to the first day of the
next calendar month, each amount which will be, in the good faith estimate
reasonably determined by Borrower, an Account of the Borrower with respect to
sales and deliveries of Hedged Eligible Inventory during such calendar month or
deliveries of Hedged Eligible Inventory during the next calendar month under
firm written purchase and sale agreements, in either event as to which the
following requirements have been fulfilled (or as to future Accounts, will be
fulfilled as of the date of such sales and deliveries of Hedged Eligible
Inventory), to the reasonable satisfaction of Administrative Agent:

 

(i)                                     Borrower
has lawful and absolute title to such Account;

 

(ii)                                  such
Account is a valid, legally enforceable obligation of an Account Debtor payable
in Dollars, arising from the sale and delivery of Hedged Eligible Inventory to
such Person in the United States of America in the ordinary course of business
of Borrower, to the extent of the volumes of Hedged Eligible Inventory
delivered to such Person prior to the date of determination;

 

(iii)                               there
has been excluded from such Account (A) any portion that is subject to any
dispute, rejection, loss, non-conformance, counterclaim or other claim or
defense on the part of any Account Debtor or to any claim on the part of any
Account Debtor denying liability under such Account, and (B) the amount of any
account payable or other liability owed by Borrower to the Account Debtor on
such Account, whether or not a specific netting agreement may exist, excluding,
however, any portion of any such account payable or other liability which is at
the time in question covered by a Letter of Credit;

 

(iv)                              Borrower
has the full and unqualified right to assign and grant a security interest in
such Account to Administrative Agent as security for the Obligation;

 

(v)                                 such
Account (A) is evidenced by an invoice rendered to the Account Debtor, or (B)
represents the uninvoiced amount in respect of volumes of Hedged Eligible
Inventory scheduled to be delivered by Borrower in the current or
next-following calendar month, is governed by a purchase and sale agreement,
exchange agreement or other written agreement, and in either event such Account
is not evidenced by any promissory note or other instrument;

 

(vi)                              such
Account is not subject to any Lien in favor of any Person and is subject to a
fully perfected first priority security interest in favor of Administrative
Agent pursuant to the Loan Documents, prior to the rights of, and enforceable
as such against, any other Person except for a Lien in respect of First
Purchase Crude Payables;

 

6

 

(vii)                           such
Account is due not more than 30 days following the last day of the calendar
month in which the Hedged Eligible Inventory delivery occurred and is not more
than 30 days past due;

 

(viii)                        such
Account is not payable by an Account Debtor with more than twenty percent (20%)
of its Accounts to Borrower that are outstanding more than 60 days from the
invoice date;

 

(ix)                                the
Account Debtor in respect of such Account (A) is located, is conducting
significant business or has significant assets in the United States of America
or is a Person Currently Approved by Majority Lenders, (B) is not an
Affiliate of Borrower, and (C) is not the subject of any event of the type
described in Section 8.1(i); and

 

(x)                                   the
Account Debtor in respect of such Account is not a governmental authority,
domestic or foreign.

 

“Eligible
Transferee” means a Person which either (a) is a Lender, or
(b) is consented to as an Eligible Transferee by Administrative Agent and,
so long as no Default or Event of Default is continuing, by Borrower, which
consents in each case will not be unreasonably withheld; provided no
Person organized outside the United States may be an Eligible Transferee if
Borrower would be required to pay withholding taxes on interest or principal
owed to such Person.

 

“Environmental
Laws” means any and all Laws relating to the environment or to emissions,
discharges, releases or threatened releases of pollutants, contaminants,
chemicals, or industrial, toxic or hazardous substances or wastes into the
environment including ambient air, surface water, ground water, or land, or
otherwise relating to the manufacture, processing, distribution, use,
treatment, storage, disposal, transport, or handling of pollutants,
contaminants, chemicals, or industrial, toxic or hazardous substances or
wastes.

 

“ERISA”
means the Employee Retirement Income Security Act of 1974, as amended from time
to time, together with all rules and regulations promulgated with respect
thereto.

 

“ERISA
Affiliate” means Borrower and all members of a controlled group of
corporations and all trades or businesses (whether or not incorporated) under
common control that, together with Borrower, are treated as a single employer
under Section 414 of the Code.

 

“ERISA Plan”
means any employee pension benefit plan subject to Title IV of ERISA maintained
by any ERISA Affiliate with respect to which Borrower has a fixed or contingent
liability.

 

“Event of
Default” has the meaning given to such term in Section 8.1.

 

“Existing
Agreements” means (i) that certain Second Amended and Restated Credit
Agreement [Revolving Credit Facility] dated July 2, 2002 among Borrower and
certain 

 

7

 

Affiliates,  Fleet National
Bank, as administrative agent, and the agents and lenders named therein, and
(ii) that certain Second Amended and Restated Credit Agreement [Letter of
Credit and Hedged Inventory Facility] dated July 2, 2003 among Borrower and
certain Affiliates, Fleet National Bank, as administrative agent, and the
agents and lenders named therein.

 

“Facility
Usage” means, at the time in question, the aggregate amount of Loans and LC
Obligations with respect to Letters of Credit outstanding at such time.

 

“Federal
Funds Rate” means, for any day, the rate per annum (rounded upwards, if
necessary, to the nearest 1/1000th of one percent) equal to the weighted
average of the rates on overnight Federal funds transactions with members of
the Federal Reserve System arranged by Federal funds brokers on such day, as
published by the Federal Reserve Bank of New York on the Business Day next
succeeding such day, provided that (i) if the day for which such rate is to be
determined is not a Business Day, the Federal Funds Rate for such day shall be
such rate on such transactions on the next preceding Business Day as so
published on the next succeeding Business Day, and (ii) if such rate is not so
published for any day, the Federal Funds Rate for such day shall be the average
rate quoted to Administrative Agent on such day on such transactions as
determined by Administrative Agent.

 

“Financed
Hedged Eligible Inventory” means all Hedged Eligible Inventory that one or
more Lenders have (i) committed to participate in letters of credit to secure
the purchase of such Hedged Eligible Inventory pursuant to Cash and Carry
Purchases and/or (ii) committed to finance (a) the purchase of such Hedged
Eligible Inventory pursuant to Cash and Carry Purchases or (b) the storage
of such Hedged Eligible Inventory at Approved Locations.

 

“First
Purchase Crude Payables” means the unpaid amount of any payable obligation
related to the purchase of Petroleum Products by Borrower secured by a
statutory Lien, including but not limited to the statutory Liens, if any,
created under the laws of Texas, New Mexico, Wyoming, Kansas, Oklahoma or any
other state to the extent such payable obligation is not at the time in
question covered by a Letter of Credit.

 

“Fiscal
Quarter” means a three-month period ending on March 31, June 30, September
30 or December 31 of any year.

 

“Fiscal
Year” means a twelve-month period ending on December 31 of any year.

 

“Funding
Date” has the meaning given to such term in Section 2.1(a).

 

“GAAP”
means those generally accepted accounting principles and practices which are
recognized as such by the Financial Accounting Standards Board (or any
generally recognized successor) and which, in the case of Borrower and its Consolidated
Subsidiaries, are applied for all periods after the date hereof in a manner
consistent with the manner in which such principles and practices were applied
to the Initial Financial Statements.  If
any change in any accounting principle or practice is required by the Financial
Accounting Standards Board (or any such successor) in order for such principle
or practice to continue as a generally accepted accounting principle or
practice, all reports and financial statements required hereunder with respect
to 

 

8

 

Borrower or with respect to Borrower and its Consolidated Subsidiaries
may be prepared in accordance with such change, but all calculations and
determinations to be made hereunder may be made in accordance with such change
only after notice of such change is given to each Lender and Majority Lenders
agree to such change insofar as it affects the accounting of Borrower or of
Borrower and its Consolidated Subsidiaries.

 

“GP Inc.”
means Plains Marketing GP Inc., a Delaware corporation, the sole general
partner of Borrower.

 

“Hazardous
Materials” means any substances regulated under any Environmental Law,
whether as pollutants, contaminants, or chemicals, or as industrial, toxic or
hazardous substances or wastes, or otherwise.

 

“Hedged
Eligible Inventory” means Petroleum Products scheduled to be purchased by
Borrower in the month following delivery of a Financing Request-Initial
specified as Hedged Eligible Inventory therein, which has been hedged by either
a NYMEX contract, an OTC contract or a contract for physical delivery to an
investment-grade counterparty or other counterparty Currently Approved by
Majority Lenders and which, upon such purchase by Borrower, shall qualify as
Eligible Inventory.

 

“Hedged
Value” means, as to Hedged Eligible Inventory specified in a Financing
Request-Initial or Financing Request-Final and the corresponding Hedging
Contract or Hedging Contracts with respect thereto, an amount equal to the
volume of such Hedged Eligible Inventory times the prices fixed in such
corresponding hedge, minus (i) all related storage, transportation and
other applicable costs of such Hedged Eligible Inventory, as set forth therein
and (ii) the amount secured by any Broker Liens, other than Broker Liens on
margin deposits with respect to such corresponding Hedging Contracts.

 

“Hedging
Contract” means (a) any agreement providing for options, swaps, floors,
caps, collars, forward sales or forward purchases involving interest rates,
commodities or commodity prices, equities, currencies, bonds, or indexes based
on any of the foregoing, (b) any option, futures or forward contract traded on
an exchange, and (c) any other derivative agreement or other similar agreement
or arrangement.

 

“Highest
Lawful Rate” means, with respect to each Lender Party to whom Obligations
are owed, the maximum nonusurious rate of interest that such Lender Party is
permitted under applicable Law to contract for, take, charge, or receive with
respect to such Obligations.  All determinations
herein of the Highest Lawful Rate, or of any interest rate determined by
reference to the Highest Lawful Rate, shall be made separately for each Lender
Party as appropriate to assure that the Loan Documents are not construed to
obligate any Person to pay interest to any Lender Party at a rate in excess of
the Highest Lawful Rate applicable to such Lender Party.

 

“Indebtedness”
of any Person means each of the following:

 

(a)  its obligations for the repayment of
borrowed money,

 

9

 

(b)  its obligations to pay the deferred purchase
price of property or services (excluding trade account payables arising in the
ordinary course of business), other than contingent purchase price or similar
obligations incurred in connection with an acquisition and not yet earned or
determinable,

 

(c)  its obligations evidenced by a bond,
debenture, note or similar instrument,

 

(d)  its obligations, as lessee, constituting
principal under Capital Leases,

 

(e)  its direct or contingent reimbursement
obligations with respect to the face amount of letters of credit pursuant to
the applications or reimbursement agreements therefor,

 

(f)  its obligations for the repayment of
outstanding banker’s acceptances, whether matured or unmatured,

 

(g)  its obligations under any synthetic lease,
tax retention operating lease, off-balance sheet loan or similar off-balance
sheet financing if the obligation under such synthetic lease, tax retention
operating lease, off-balance sheet loan or similar off-balance sheet financing
is considered indebtedness for borrowed money for tax purposes but is
classified as an operating lease in accordance with GAAP (excluding, to the
extent included herein, operating leases entered into in the ordinary course of
business), or

 

(h)  its obligations under guaranties of any
obligations of any other Person described in the foregoing clauses (a) through
(g).

 

“Initial
Financial Statements” means (i) the audited Consolidated financial
statements of PAA as of December 31, 2002, (ii) the unaudited consolidating
balance sheet and income statement of PAA as of September 30, 2003, (iii) the
unaudited Consolidated financial statements of Borrower as of December 31,
2002, and (iv) the unaudited consolidating balance sheet and income statement
of Borrower as of September 30, 2003.

 

“Interest
Payment Date” means (a) with respect to each Base Rate Loan, the last
day of each March, June, September and December beginning December 31, 2003,
and (b) with respect to each LIBOR Loan, the last day of the Interest Period
that is applicable thereto and, if such Interest Period is six or twelve months
in length, the dates specified by Administrative Agent which are approximately
three, six, and nine months (as appropriate) after such Interest Period begins;
provided that the last Business Day of each calendar month shall also be an
Interest Payment Date for each such Loan so long as any Event of Default exists
under Section 8.1(a) or (b).

 

“Interest
Period” means, with respect to each particular LIBOR Loan in a Borrowing,
the period specified in the Borrowing Notice or Continuation/Conversion Notice
applicable thereto, beginning on and including the date specified in such
Borrowing Notice or Continuation/Conversion Notice (which must be a Business
Day), and ending one, two, three, six or twelve months (if twelve months is
available for each Lender) thereafter (and, as to Loans, ending on a date less
than 30 days thereafter as may be specified by Borrower, if such lesser period
is available for 

 

10

 

each Lender), as Borrower may elect in such notice; provided that:  (a) any Interest Period which would
otherwise end on a day which is not a Business Day shall be extended to the
next succeeding Business Day unless such Business Day falls in another calendar
month, in which case such Interest Period shall end on the next preceding
Business Day; (b) any Interest Period which begins on the last Business Day in
a calendar month (or on a day for which there is no numerically corresponding
day in the calendar month at the end of such Interest Period) shall end on the
last Business Day in a calendar month; and (c) notwithstanding the foregoing,
no Interest Period may be selected for a Loan to Borrower that would end after
the Maturity Date.

 

“Investment”
means any investment made, directly or indirectly in any Person, whether by
acquisition of shares of capital stock, indebtedness or other obligations or
securities or by loan, advance, capital contribution or otherwise, and whether
made in cash, by the transfer of property or by any other means.

 

“Law”
means any statute, law, regulation, ordinance, rule, treaty, judgment, order,
decree, permit, concession, franchise, license, agreement or other governmental
restriction of the United States or Canada or any state, province, or political
subdivision thereof or of any foreign country or any department, state,
province or other political subdivision thereof.

 

“LC
Application” means any application for a Letter of Credit hereafter made by
Borrower to LC Issuer.

 

“LC-Backed
Purchase Contracts” has the meaning given to such term in Section 2.1(a).

 

“LC
Collateral” has the meaning given such term in Section 2.15(a).

 

“LC Issuer”
means Fleet National Bank, in its capacity as the issuer of Letters of Credit
hereunder, and its successors in such capacity.  Administrative Agent may, with the consent of Borrower and the
Lender in question, appoint any Lender hereunder as an LC Issuer in place of or
in addition to Fleet National Bank.

 

“LC
Obligations” means, at the time in question, the sum of all Matured LC
Obligations plus the maximum amounts which LC Issuer might then or thereafter
be called upon to advance under all Letters of Credit then outstanding.

 

“Lender
Parties” means Administrative Agent, LC Issuer and all Lenders.

 

“Lenders”
means each signatory hereto designated as a Lender, and the successors and
permitted assigns of each such party as holder of a Note.

 

“Lender
Schedule” means Schedule 1 hereto.

 

“Letter of
Credit” means any letter of credit issued by LC Issuer hereunder at the
application of Borrower.

 

11

 

“Letter of
Credit Fee Rate” means, on any day, the rate per annum set forth on the
Pricing Grid as the “LC Fee Rate” based on the Applicable Rating Level on such
date.  Changes in the applicable Letter
of Credit Fee Rate will occur automatically without prior notice as changes in
the Applicable Rating Level occur. 
Administrative Agent will give notice promptly to Borrower and Lenders
of changes in the Letter of Credit Fee Rate.

 

“Liabilities”
means, as to any Person, all indebtedness, liabilities and obligations of such
Person, whether matured or unmatured, liquidated or unliquidated, primary or
secondary, direct or indirect, absolute, fixed or contingent, and whether or
not required to be considered pursuant to GAAP.

 

“LIBOR Loan”
means a Loan that bears interest at a rate based upon the LIBOR Rate.

 

“LIBOR Rate”
means, as applicable to any LIBOR Loan within a Borrowing and with respect to
the related Interest Period therefor, the rate per annum (rounded upwards, if
necessary, to the nearest 1/100 of 1%) as determined on the basis of offered
rates for deposits in Dollars, for a period of time comparable to such Interest
Period which appears on Telerate Page 3750 (or any successor page) as of 11:00
a.m. London time on the day that is two Business Days preceding the first day
of such LIBOR Loan; provided, however, if the rate described above does not
appear on the Telerate system on any applicable interest determination date,
the LIBOR Rate shall be the rate (rounded upwards as described above, if
necessary) for deposits in dollars for a period substantially equal to such
Interest Period on the Reuters Page “LIBOR” (or such other page as may replace
the LIBOR Page on that service for the purpose of displaying such rates), as of
11:00 a.m. (London time), on the date that is two Business Days prior to the
beginning of such Interest Period; provided, however, if more than one rate is
specified on Reuters Screen LIBOR Page, the applicable rate shall be the
arithmetic mean of all such rates (rounded upwards, if necessary, to the
nearest 1/1000 of 1%).  If both the
Telerate and Reuters system are unavailable, then the LIBOR Rate for that date
will be determined on the basis of the offered rates for deposits in Dollars
for a period of time comparable to such Interest Period which are offered by
four major banks in the London interbank market at approximately 11:00 a.m.
London time, on the day that is two (2) Business Days preceding the first day
of such LIBOR Loan as selected by Administrative Agent.  The principal London office of each of the
four major London banks will be requested to provide a quotation of its Dollar
deposit offered rate.  If at least two
such quotations are provided, the rate for that date will be the arithmetic
mean of the quotations.  If fewer than
two quotations are provided as requested, the rate for that date will be
determined on the basis of the rates quoted for loans in Dollars to leading
European banks for a period of time comparable to such Interest Period offered
by major banks in New York City at approximately 11:00 a.m. New York City time,
on the day that is two Business Days preceding the first day of such LIBOR
Loan.  In the event that Administrative
Agent is unable to obtain any such quotation as provided above, it will be
deemed that the LIBOR Rate pursuant to such LIBOR Loan cannot be determined.  In the event that the Board of Governors of
the Federal Reserve System shall impose a Reserve Percentage with respect to
LIBOR deposits of any Lender, then for any period during which such Reserve
Percentage shall apply, the LIBOR Rate shall be equal to the amount determined
above divided by an amount equal to 1 minus the Reserve Percentage.  “Reserve Percentage” means the maximum
aggregate reserve requirement (including all basic, supplemental, marginal,
special, emergency and other reserves) which is imposed on member 

 

12

 

banks of the Federal Reserve System against “Euro-currency Liabilities”
as defined in Regulation D. 
Without limiting the effect of the foregoing, the Reserve Percentage
shall reflect any other reserves required to be maintained by such member banks
with respect to (a) any category of liabilities which includes deposits by
reference to which the LIBOR Rate is to be determined, or (b) any category of
extensions of credit or other assets which include LIBOR Loans.  The LIBOR Rate for any LIBOR Loan shall
change whenever the Reserve Percentage changes.

 

“Lien”
means, with respect to any property or assets, any right or interest therein of
a creditor to secure Liabilities owed to it or any other arrangement with such
creditor which provides for the payment of such Liabilities out of such
property or assets or which allows such creditor to have such Liabilities
satisfied out of such property or assets prior to the general creditors of any
owner thereof, including any lien, mortgage, security interest, pledge,
deposit, production payment, rights of a vendor under any title retention or
conditional sale agreement or lease substantially equivalent thereto, tax lien,
mechanic’s or materialman’s lien, or any other charge or encumbrance for security
purposes, whether arising by Law or agreement or otherwise, but excluding any
right of offset which arises without agreement in the ordinary course of
business.  “Lien” also means any filed
financing statement, any registration of a pledge (such as with an issuer of
uncertificated securities), or any other arrangement or action which would
serve to perfect a Lien described in the preceding sentence, regardless of
whether such financing statement is filed, such registration is made, or such
arrangement or action is undertaken before or after such Lien exists.

 

“Loan
Documents” means this Agreement, the Notes, the Letters of Credit, the LC
Applications, and all other agreements, certificates, documents, instruments
and writings at any time delivered in connection herewith or therewith
(exclusive of term sheets and commitment letters).

 

“Loans”
means loans by Participating Lenders to Borrower pursuant to Section 2.2.

 

“Majority
Lenders” means Lenders whose Percentage Shares equal or exceed fifty-one
percent (51%).

 

“Material
Adverse Change” means a material and adverse change, from the state of
affairs presented in the Initial Financial Statements or as represented or
warranted in any Loan Document, to (a) Borrower’s Consolidated financial
condition, (b) Borrower’s Consolidated operations, properties or prospects,
considered as a whole, (c) Borrower’s ability to timely pay its Obligations, or
(d) the enforceability of the material terms of any Loan Document.

 

“Matured LC
Obligations” means all amounts paid by LC Issuer on drafts or demands for
payment drawn or made under or purported to be under any Letter of Credit and
all other amounts due and owing to LC Issuer under any LC Application for any
such Letter of Credit, to the extent the same have not been repaid to LC Issuer
(with the proceeds of Loans or otherwise).

 

13

 

“Maturity
Date” means the Settlement Date occurring in the month following the
Funding Date of the Loans requested in the last Financing Request-Initial
accepted by one or more Participating Lenders prior to the Request Period
Termination Date.

 

“Maximum
Facility Amount” means $200,000,000, as such Maximum Facility Amount may be
increased from time to time pursuant to Section 2.1(e).

 

“Moody’s”
means Moody’s Investor Service, Inc., or its successor.

 

“Notes”
has the meaning given such term in Section 2.2 hereof.

 

“NYMEX”
means the New York Mercantile Exchange.

 

“Obligations”
means all Liabilities from time to time owing by Borrower to any Lender Party
under or pursuant to any of the Notes and Letters of Credit, including all LC
Obligations owing thereunder, or under or pursuant to any guaranty of the
obligations of Borrower or under the Loan Documents.  “Obligation” means any part of the Obligations.

 

“PAA”
means Plains All American Pipeline, L.P., a Delaware limited partnership.

 

“PAA Credit
Agreement” means that certain Credit Agreement [US/Canada Facilities] of
even date herewith among PAA, PMC (Nova Scotia) Company, Plains Marketing
Canada, L.P., Fleet National Bank, as administrative agent, The Bank of Nova
Scotia, as Canadian administrative agent, and the lenders named therein.

 

“PAA Debt
Rating” means the rating then in effect by a Rating Agency with respect to
the long term senior unsecured non-credit enhanced debt of PAA.

 

“Participating
Lender” has the meaning given to such term in Section 2.1(b).

 

“Percentage
Share” means (a) when used in Sections 2.1, 2.2 or 2.6 or in any Borrowing
Notice with respect to a Participating Lender, the percentage set forth
opposite such Participating Lender’s name on the Lender Schedule hereto, (b)
when no Letters of Credit or Loans are outstanding hereunder and no Lender has
any outstanding commitment to participate in any Letters of Credit or Loans,
with respect to each Lender, the percentage set forth opposite such Lender’s
name on the Lender Schedule hereto, and (c) when used otherwise, with respect
to each Lender, the percentage obtained by dividing (i) the sum of the unpaid
principal balance of such Lender’s Loans at the time in question plus
such Lender’s LC Obligations plus such Lender’s Percentage Share of any
Letters of Credit or Loans which such Lender has committed to participate in
pursuant to Section 2.1, by (ii) the sum of the aggregate unpaid principal
balance of all Loans at such time plus the aggregate amount of LC
Obligations outstanding at such time plus the aggregate amount of
Letters of Credit and Loans which one or more Lenders have committed to
participate in pursuant to Section 2.1.

 

“Permitted
Inventory Liens” means (i) any Lien, and the amount of any Liability
secured thereby, on Petroleum Products inventory imposed by any governmental
authority for taxes,

 

14

 

assessments or charges not yet due or the validity of which is being
contested in good faith and by appropriate proceedings, if necessary, for which
adequate reserves are maintained on the books of Borrower in accordance with
GAAP (so long as such Lien is inchoate) or (ii) carriers’, warehousemen’s,
mechanics’, materialmen’s, repairmen’s, landlord’s, or other like Liens
(including, without limitation, Liens on property of Borrower in the possession
of storage facilities, pipelines or barges) arising in the ordinary course of
business for amounts which are not more than 60 days past due or the validity
of which is being contested in good faith and by appropriate proceedings, if
necessary, and for which adequate reserves are maintained on the books of
Borrower in accordance with GAAP.

 

“Person”
means an individual, corporation, partnership, limited liability company,
association, joint stock company, trust or trustee thereof, estate or executor
thereof, unincorporated organization or joint venture, Tribunal, or any other
legally recognizable entity.

 

“Petroleum
Products” means crude oil, condensate, natural gas, natural gas liquids
(NGL’s), liquefied petroleum gases (LPG’s), refined petroleum products or any
blend thereof.

 

“Plains
Terminal” means any storage terminal, tankage or facility owned by Borrower
or by any Affiliate of Borrower that has executed and delivered a bailee letter
in form and substance reasonably acceptable to Administrative Agent with
respect to any Collateral stored at such terminal, tankage or facility.

 

“Pricing
Grid” means Schedule 3 attached hereto.

 

“Rating
Agency” means either S&P or Moody’s.

 

“Regulation
D” means Regulation D of the Board of Governors of the Federal Reserve
System as from time to time in effect.

 

“Request
Period” means the period from and including the date hereof until the
Request Period Termination Date (or, if earlier, the day on which any
commitment of any Lender to make Loans or participate in Letters of Credit, and
the obligation of LC Issuer to issue such Letters of Credit, has been terminated,
or the day on which any of the Notes first becomes due and payable in full).

 

“Request
Period Termination Date” means November 21, 2004, as such date may be
extended pursuant to Section 2.9.

 

“Restriction
Exception” means (i) any applicable Law or any instrument governing
Indebtedness or equity interests, or any applicable Law or any other agreement
relating to any property, assets or operations of a Person whose capital stock
or other equity interests are acquired, in whole or part, by Borrower pursuant
to an acquisition (whether by merger, consolidation, amalgamation or
otherwise), as such instrument or agreement is in effect at the time of such
acquisition (except with respect to Indebtedness incurred in connection with,
or in contemplation of, such acquisition), or such applicable Law is then or
thereafter in effect (as applicable), which is not applicable to Borrower, or
the property, assets or operations of 

 

15

 

Borrower, other than the acquired Person, or the property, assets or
operations of such acquired Person or such acquired Person’s Subsidiaries; provided
that in the case of Indebtedness, the incurrence of such Indebtedness is not
prohibited hereunder, or (ii) provisions with respect to the disposition or
distribution of assets in joint venture agreements or other similar agreements
entered into in the ordinary course of business.

 

“S&P”
means Standard & Poor’s Ratings Group (a division of McGraw Hill, Inc.) or
its successor.

 

“Sale/Storage
Month” has the meaning given to such term in Section 2.1(a).

 

“Sale Value”
means, as to Hedged Eligible Inventory specified in a Financing Request-Final
and the corresponding sales contracts with respect thereto, an amount equal to
the volumes of such Hedged Eligible Inventory times the sale price (or
the Hedged Value of stored Hedged Eligible Inventory not subject to sales
contracts) with respect to which Lenders are financing the Cash and Carry
Purchase (or refinancing the storage) thereof, minus all related storage,
transportation and other applicable costs, as set forth therein.

 

“Security
Documents” means the instruments listed in the Security Schedule and all
other security agreements, chattel mortgages, pledges, financing statements,
continuation statements, extension agreements and other agreements or
instruments now, heretofore, or hereafter delivered by Borrower to
Administrative Agent in connection with this Agreement or any transaction
contemplated hereby to secure or guarantee the payment of any part of the
Obligations or the performance of Borrower’s other duties and obligations under
the Loan Documents.

 

“Security
Schedule” means Schedule 3 hereto.

 

“Settlement
Date” means the US crude oil monthly settlement date, occurring on or about
the 20th day of each month.

 

“Subsidiary”
means, with respect to any Person, any corporation, association, partnership,
limited liability company, joint venture, or other business or corporate
entity, enterprise or organization which is directly or indirectly (through one
or more intermediaries) controlled or owned more than fifty percent by such
Person.

 

“Termination
Event” means (a) the occurrence with respect to any ERISA Plan of (i) a
reportable event described in Sections 4043(c)(5) or (6) of ERISA or (ii) any
other reportable event described in Section 4043(c) of ERISA other than a
reportable event not subject to the provision for 30-day notice to the Pension
Benefit Guaranty Corporation pursuant to a waiver by such corporation under
Section 4043(a) of ERISA, or (b) the withdrawal of any ERISA Affiliate from an
ERISA Plan during a plan year in which it was a “substantial employer” as
defined in Section 4001(a)(2) of ERISA, or (c) the filing of a notice of intent
to terminate any ERISA Plan or the treatment of any ERISA Plan amendment as a
termination under Section 4041 of ERISA, or (d) the institution of proceedings
to terminate any ERISA Plan by the Pension Benefit Guaranty Corporation under
Section 4042 of ERISA, or (e) any other event or condition which 

 

16

 

might constitute grounds under Section 4042 of ERISA for the
termination of, or the appointment of a trustee to administer, any ERISA Plan.

 

“Tribunal”
means any government, any arbitration panel, any court or any governmental
department, commission, board, bureau, agency or instrumentality of the United
States of America, the Dominion of Canada, or any state, province,
commonwealth, nation, territory, possession, county, parish, town, township,
village or municipality, whether now or hereafter constituted or existing.

 

“Type”
means, with respect to any Loans, the characterization of such Loans as Base
Rate Loans or LIBOR Loans.

 

“UCC”
means the Uniform Commercial Code as in effect in the State of New York.

 

Section 1.2.  Exhibits and Schedules; Additional
Definitions.  All Exhibits and
Schedules attached to this Agreement are a part hereof for all purposes.

 

Section 1.3.  Amendment of Defined Instruments.  Unless the context otherwise requires or
unless otherwise provided herein the terms defined in this Agreement which
refer to a particular agreement, instrument or document also refer to and
include all renewals, extensions, modifications, amendments and restatements of
such agreement, instrument or document, provided that nothing contained in this
section shall be construed to authorize any such renewal, extension,
modification, amendment or restatement.

 

Section 1.4.  References and Titles.  All references in this Agreement to
Exhibits, Schedules, articles, sections, subsections and other subdivisions
refer to the Exhibits, Schedules, articles, sections, subsections and other
subdivisions of this Agreement unless expressly provided otherwise.  Titles appearing at the beginning of any
subdivisions are for convenience only and do not constitute any part of such
subdivisions and shall be disregarded in construing the language contained in
such subdivisions.  The words “this
Agreement,” “this instrument,” “herein,” “hereof,” “hereby,” “hereunder” and
words of similar import refer to this Agreement as a whole and not to any
particular subdivision unless expressly so limited.  The phrases “this section” and “this subsection” and similar
phrases refer only to the sections or subsections hereof in which such phrases
occur.  The word “or” is not exclusive,
and the word “including” (in its various forms) means “including without
limitation.”  Pronouns in masculine,
feminine and neuter genders shall be construed to include any other gender, and
words in the singular form shall be construed to include the plural and vice
versa, unless the context otherwise requires. 
References to an “officer” or “officers” of Borrower shall mean and
include officers of such Person or the controlling management entity of such
Person as provided in such Person’s organizational documents, as applicable.

 

Section 1.5.  Calculations and Determinations.  All calculations under the Loan Documents of
interest chargeable with respect to LIBOR Loans and of fees shall be made on
the basis of actual days elapsed (including the first day but excluding the
last) and a year of 360 days.  All other
calculations of interest made under the Loan Documents shall be made on the
basis of actual days elapsed (including the first day but excluding the last)
and a year of 365 or 366 days,

 

17

 

as appropriate.  Each
determination by a Lender Party of amounts to be paid under Article III or any
other matters which are to be determined hereunder by a Lender Party (such as
any LIBOR Rate, Business Day, Interest Period, or Reserve Percentage) shall, in
the absence of manifest error, be conclusive and binding.  Unless otherwise expressly provided herein
or unless Majority Lenders otherwise consent all financial statements and reports
furnished to any Lender Party hereunder shall be prepared and all financial
computations and determinations pursuant hereto shall be made in accordance
with GAAP.

 

ARTICLE II - Loans
and Letters of Credit 

 

Section 2.1.  Financing Requests, Commitments and
Fundings.

 

(a) Borrower
Financing Requests.  During the
Request Period, Borrower may, not later than 12:00 noon, Eastern time on the
third Business Day prior to the end of each calendar month, submit to Lenders a
Financing Request-Initial in the form of Exhibit B-1 (i) specifying volumes of
Hedged Eligible Inventory to be subject to Cash and Carry Purchases in the
month (the “Delivery Month”) following the month Borrower submits such
corresponding Financing Request-Initial, or stored at and to remain stored at
Approved Locations during the Delivery Month, including hedged price, Hedged
Value and Approved Locations where such Hedged Eligible Inventory is to be
delivered and/or stored during the Delivery Month, (ii) specifying the Hedging
Contracts (including Master ISDA Agreements, counterparties and confirmations
thereunder) covering such Hedged Eligible Inventory, and (iii) to the extent
available, listing any corresponding sale contracts (with purchaser, date,
volumes, prices, delivery dates and such other identifying information as
Administrative Agent may reasonably request) pursuant to which Borrower has
contracted to sell such Hedged Eligible Inventory, or otherwise specifying the
Approved Locations where such Hedged Eligible Inventory is to be sold from
and/or stored in the month following the Delivery Month (the “Sale/Storage
Month”).  Pursuant to such Financing
Request-Initial, Borrower may request Lenders to commit to make pro rata
advances on the Settlement Date for the Delivery Month (the “Funding Date”)
of up to 90% of the lesser of (x) the Sale Value of such Hedged Eligible
Inventory and (y) 110% of the Hedged Value of such Hedged Eligible Inventory,
to fund the purchase of such Hedged Eligible Inventory or to refinance such
stored Hedged Eligible Inventory, which commitment shall include Lenders’
participation on a pro rata basis in letters of credit, in an amount not to
exceed 90% of the Hedged Value of such Hedged Eligible Inventory, to secure the
purchase of such Hedged Eligible Inventory, if Borrower shall at its sole
option so elect prior to such Funding Date.

 

(b) Lender
Evaluation of Financing Requests-Initial. 
Each Lender shall independently evaluate each Financing Request-Initial
and related contracts and shall determine, in
its sole and absolute discretion, whether or not it desires to
commit to such requested financing. 
Each Lender shall notify Agent by 12:00 noon, Eastern time on the second
Business Day following such Financing Request-Initial as to whether or not such
Lender is willing to commit to such requested financing, and Agent shall
promptly thereafter notify Borrower of each Lender’s response with respect to
Borrower’s Financing Request-Initial.

 

18

 

No Lender shall have any commitment or obligation to commit
to any requested financing, participate in any Letter of Credit and/or make any
Loan hereunder unless and until such Lender affirmatively commits to such
requested financing.  Nothing contained
herein shall otherwise commit or obligate any Lender, or be interpreted as a
promise or commitment by any Lender to make or elect to make any such Loan or
participate or elect to participate in any such Letter of Credit.

 

Once a Lender affirmatively
commits to a requested financing (a “Participating Lender”), such
commitment shall be binding on such Participating Lender with respect to, but
only with respect to, such requested financing, and shall not bind such
Participating Lender to participate in any subsequent requested financing.  Furthermore, notwithstanding a Participating
Lender’s commitment to a requested financing, such Participating Lender shall
have no commitment or obligation to participate in such requested financing in
an amount in excess of its Percentage Share of such requested financing or in
an amount that would cause such Lender’s outstanding Loans and Percentage Share
of LC Obligations to exceed such Lender’s Percentage Share of the Maximum
Facility Amount.  At Borrower’s election,
Borrower may subsequently request Participating Lenders with respect to any
Financing Request-Initial to increase their commitments with respect to such
Financing Request-Initial in an amount not to exceed the aggregate Percentage
Share of any Lenders declining to participate in such Financing
Request-Initial.  No Participating
Lender shall have any commitment or obligation to participate in such requested
increase.  In the event a Participating
Lender affirmatively commits to any such requested increase, such Participating
Lender’s corresponding commitments to participate in Letters of Credit and
Loans with respect thereto pursuant to Section 2.1(c) and 2.1(d) shall be
increased accordingly.

 

(c) Letters
of Credit Securing LC-Backed Purchase Contracts.  With respect to a Financing Request-Initial, if one or more
Participating Lenders shall have committed to participate in the requested
financing, the LC Issuer shall, at Borrower’s request prior to the applicable
Funding Date, issue one or more Letters of Credit pursuant to Section 2.10, naming
the sellers of such Hedged Eligible Inventory under such purchase contracts as
Borrower may specify (“LC-Backed Purchase Contracts”), as beneficiaries,
in an amount equal to the aggregate Percentage Share of Participating Lenders
times the requested face amount of such Letters of Credit; provided,
Borrower shall specify to Administrative Agent the seller, date, volumes,
prices, delivery dates and such other identifying information as Administrative
Agent may reasonably request with respect to each such LC-Backed Purchase
Contract.  Each such Letter of Credit
shall by its terms identify the specific LC-Backed Purchase Contracts to which
it relates and shall automatically reduce upon receipt by the beneficiary thereof
of any payments made by Borrower to such beneficiary for such Hedged Eligible
Inventory referencing such Letter of Credit.

 

19

 

(d) Loans
to Finance Cash and Carry Purchases/Storage of Hedged Eligible Inventory.  With respect to a Financing Request-Initial,
if one or more Participating Lenders shall have committed to finance Cash and
Carry Purchases of Hedged Eligible Inventory (or refinance the storage of
Hedged Eligible Inventory), Borrower shall, prior to the end of the applicable
Delivery Month, submit to Lenders a Financing Request-Final in the form of
Exhibit B-2 with respect to such Hedged Eligible Inventory pursuant to Section
2.3(a) listing the corresponding sale contracts (with purchaser, date,
volumes, prices, delivery dates and such other identifying information as
Administrative Agent may reasonably request) pursuant to which Borrower will
sell such Hedged Eligible Inventory during the applicable Sale/Storage Month,
including specifying volumes, sale price and Sale Value, or (b) Approved
Locations where such Hedged Eligible Inventory is to be stored during the
applicable Sale/Storage Month, with volumes, hedged price and Hedged
Value.  On the applicable Funding Date,
each Participating Lender shall make its Loan pursuant to Section 2.2, net
of any prior Loans by such Participating Lender due and payable on such Funding
Date, and Administrative Agent shall (i) net against such aggregate Loans the
aggregate amount of any other Loans due and payable on such Funding Date, (ii)
repay such matured Loans to the Lenders thereof and (iii) make the balance
available to Borrower pursuant to Section 2.3.

 

(e) Increase
of Maximum Facility Amount. 
Borrower shall have the right, without the consent of the Lenders but
with the prior approval of the Administrative Agent, not to be unreasonably
withheld, to cause from time to time an increase in the Maximum Facility Amount
by adding to this Agreement one or more additional Lenders or by allowing one
or more Lenders to increase their portion of the Maximum Facility Amount;
provided however (i) no Event of Default shall have occurred hereunder which is
continuing, (ii) no such increase shall result in the Maximum Facility Amount
to exceed $300,000,000, and (iii) no Lender’s portion of the Maximum Facility Amount
shall be increased without such Lender’s consent.

 

Section 2.2.  Loans and Notes.  Subject to the terms and conditions hereof,
each Participating Lender with respect to a Financing Request-Initial and
corresponding Financing Request-Final and Borrowing Notice agrees to make a
Loan to Borrower on the Funding Date corresponding thereto in an amount equal
to such Participating Lender’s Percentage Share of the lesser of (x) 90% of the
Sale Value and (y) 110% of the Hedged Value of the Hedged Eligible Inventory
described therein; provided that (a) subject to Sections 3.3, 3.4
and 3.6, all such Participating Lenders are requested to make Loans of the same
Type in accordance with their respective Percentage Shares and as part of the
same Borrowing, (b) after giving effect to such Loans (and the repayment
of any outstanding Loans on such date pursuant to netting with respect thereto
as set forth in the last sentence of Section 2.1(d)), the Facility Usage does
not exceed the Maximum Facility Amount determined as of the date on which the
requested Loans are to be made, and (c) after giving effect to such Loans
(and the repayment of any outstanding Loans on such date pursuant to netting
with respect thereto as set forth in the last sentence of Section 2.1(d)),
the Loans by such Participating Lender plus the existing LC Obligations of such
Participating Lender with respect to Letters of Credit do not exceed such
Lender’s Percentage Share of the Maximum Facility Amount.  The aggregate amount of all Loans in any
Borrowing must be equal to $2,000,000 or any higher integral multiple of
$250,000.  The obligation of Borrower to
repay to each Lender the aggregate amount of all Loans made by such Lender to
Borrower, together with interest accruing in connection therewith, shall be
evidenced by a single

 

20

 

promissory note (herein called such Lender’s “Note”) made by
Borrower payable to the order of such Lender in the form of Exhibit A with
appropriate insertions.  The amount of principal
owing on any Lender’s Note at any given time shall be the aggregate amount of
all Loans theretofore made by such Lender to Borrower minus all payments of
principal theretofore received by such Lender on such Note.  Interest on each Note shall accrue and be
due and payable as provided herein and therein.  Each Note shall be due and payable as provided herein and
therein, and shall be due and payable in full on the Maturity Date.  Subject to the terms and conditions of this
Agreement, Borrower may borrow, repay, and reborrow under this
Section 2.2.  Borrower may have no
more than seven Borrowings of LIBOR Loans outstanding at any time.  All payments of principal and interest on
the Loans shall be made in Dollars.

 

Section 2.3.  Requests for Loans.  Borrower must give to Administrative Agent
written notice (or telephonic notice promptly confirmed in writing) of any
requested Borrowing.  Each such notice
constitutes a “Borrowing Notice” hereunder and must:

 

(a)  specify the corresponding
Financing Request-Final, each Participating Lender therein, and (A) the
aggregate amount of any such Borrowing and the Funding Date on which Base Rate
Loans are to be advanced, or (B) the aggregate amount of any such Borrowing of
new LIBOR Loans, the Funding Date on which such LIBOR Loans are to be advanced
(which shall be the first day of the Interest Period which is to apply
thereto), and the length of the applicable Interest Period; and

 

(b)  be received by
Administrative Agent not later than 11:00 a.m., Boston, Massachusetts time, on
(i) the day on which any such Base Rate Loans are to be made, or (ii) the third
Business Day preceding the day on which any such LIBOR Loans are to be made.

 

Each such written request or
confirmation must be made in the form and substance of the “Borrowing Notice”
attached hereto as Exhibit B-3, duly completed.  Each such telephonic request shall be deemed a representation,
warranty, acknowledgment and agreement by Borrower as to the matters which are
required to be set out in such written confirmation.  Upon receipt of any such Borrowing Notice, Administrative Agent
shall give each Lender prompt notice of the terms thereof.  If all conditions precedent to such new
Loans have been met, each Participating Lender therein will on the Funding Date
promptly remit to Administrative Agent at its office in Boston, Massachusetts
the amount of such Participating Lender’s new Loan in immediately available
funds, and upon receipt of such funds, unless to its actual knowledge any
conditions precedent to such Loans have been neither met nor waived as provided
herein, Administrative Agent shall promptly make such Loans available to
Borrower.  Unless Administrative Agent
shall have received prompt notice from a Participating Lender that such
Participating Lender will not make available to Borrower such Lender’s new
Loan, Administrative Agent may in its discretion assume that such Participating
Lender has made such Loan available to Administrative Agent in accordance with
this section, and Administrative Agent may if it chooses, in reliance upon such
assumption, make such Loan available to Borrower.  If and to the extent such Participating Lender shall not so make
its new Loan available to Administrative Agent, such Participating Lender and
Borrower severally agree to pay or repay to Administrative Agent within three
days after demand the amount of such Loan together with interest thereon, for
each

 

21

 

day from the date such amount
was made available to Borrower until the date such amount is paid or repaid to
Administrative Agent, with interest at (i) the Federal Funds Rate, if such
Participating Lender is making such payment, and (ii) the interest rate
applicable at the time to the other new Loans made on such date, if Borrower is
making such repayment.  If neither such
Participating Lender nor Borrower pays or repays to Administrative Agent such
amount within such three-day period, Administrative Agent shall be entitled to
recover from Borrower, on demand in lieu of the interest provided for in the
preceding sentence, interest thereon at the Default Rate, calculated from the
date such amount was made available to Borrower.  The failure of any Participating Lender to make any new Loan to
be made by it hereunder shall not relieve any other Participating Lender of its
obligation hereunder, if any, to make its new Loan, but no Participating Lender
shall be responsible for the failure of any other Participating Lender to make
any new Loan to be made by such other Participating Lender.  All Borrowings of Loans shall be advanced in
Dollars.

 

Section 2.4.  Continuations and Conversions of Existing
Loans.  Borrower may make the
following elections with respect to Loans already outstanding: (i) to Convert,
in whole or in part, Base Rate Loans to LIBOR Loans, (ii) to Convert, in whole
or in part, LIBOR Loans to Base Rate Loans on the last day of the Interest
Period applicable thereto, and (iii) to Continue, in whole or in part, LIBOR
Loans beyond the expiration of such Interest Period by designating a new
Interest Period to take effect at the time of such expiration.  In making such elections, Borrower may
combine existing Loans to Borrower made pursuant to separate Borrowings into
one new Borrowing or divide existing Loans to Borrower made pursuant to one
Borrowing into separate new Borrowings, provided that Borrower may have no more
than seven Borrowings of LIBOR Loans outstanding at any time.  To make any such election, Borrower must
give to Administrative Agent written notice (or telephonic notice promptly
confirmed in writing) of any such Conversion or Continuation of existing Loans,
with a separate notice given for each new Borrowing.  Each such notice constitutes a “Continuation/Conversion Notice”
hereunder and must:

 

(i)  specify the existing Loans
which are to be Continued or Converted;

 

(ii)  specify (A) the aggregate
amount of any Borrowing of Base Rate Loans into which such existing Loans are
to be Continued or Converted and the date on which such Continuation or
Conversion is to occur, or (B) the aggregate amount of any Borrowing of LIBOR
Loans into which such existing Loans are to be Continued or Converted,  the date on which such Continuation or
Conversion is to occur (which shall be the first day of the Interest Period
which is to apply to such LIBOR Loans), and the length of the applicable
Interest Period; and

 

(iii) be received by Administrative Agent not later than 11:00 a.m.
Boston, Massachusetts time, on (i) the day on which any such Continuation or
Conversion to Base Rate Loans is to occur, or (ii) the third Business Day
preceding the day on which any such Continuation or Conversion to LIBOR Loans
is to occur.

 

Each such written request or
confirmation must be made in the form and substance of the “Continuation/Conversion
Notice” attached hereto as Exhibit C, duly completed.  Each such 

 

22

 

telephonic request shall be
deemed a representation, warranty, acknowledgment and agreement by Borrower as
to the matters which are required to be set out in such written
confirmation.  Upon receipt of any such
Continuation/Conversion Notice, Administrative Agent shall give each Lender
prompt notice of the terms thereof. 
Each Continuation/Conversion Notice shall be irrevocable and binding on
Borrower.  During the continuance of any
Default, Borrower may not make any election to Convert existing Loans into
LIBOR Loans or Continue existing Loans as LIBOR Loans beyond the expiration of
their respective and corresponding Interest Period then in effect.  If (due to the existence of a Default or for
any other reason) Borrower fails to timely and properly give any
Continuation/Conversion Notice with respect to a Borrowing of existing LIBOR
Loans at least three days prior to the end of the Interest Period applicable to
such LIBOR Loans, any such LIBOR Loans, to the extent not prepaid at the end of
such Interest Period, shall automatically be Converted into Base Rate Loans at
the end of such Interest Period.  No new
funds shall be repaid by Borrower or advanced by any Lender in connection with
any Continuation or Conversion of existing Loans pursuant to this section, and
no such Continuation or Conversion shall be deemed to be a new advance of funds
for any purpose; such Continuations and Conversions merely constitute a change
in the interest rate applicable to such already outstanding Loans.

 

Section 2.5.  Use of Proceeds.  Borrower shall use all Loans to finance Cash
and Carry Purchases of Hedged Eligible Inventory and to refinance Matured LC
Obligations.  Any Loans used to purchase
Hedged Eligible Inventory under LC-Backed Purchase Contracts shall be used by
Borrower on the Funding Date to pay the sellers thereunder, with reference in
each case to the outstanding Letter of Credit issued with respect to such
LC-Backed Purchase Contract, and Borrower shall provide documentation to
Administrative Agent with respect thereto. Borrower shall use all Letters of
Credit solely for the purposes set forth in Section 2.10(d).  In no event shall the funds from any Loans
or any Letters of Credit be used directly or indirectly by any Person for
personal, family, household or agricultural purposes or for the purpose,
whether immediate, incidental or ultimate, of purchasing, acquiring or carrying
any “margin stock” (as such term is defined in Regulation U promulgated by the
Board of Governors of the Federal Reserve System) or to extend credit to others
directly or indirectly for the purpose of purchasing or carrying any such
margin stock.  Borrower represents and
warrants that it is not engaged principally, or as one of its important
activities, in the business of extending credit to others for the purpose of
purchasing or carrying such margin stock.

 

Section 2.6.  Interest Rates and Fees.

 

(a)  Interest Rates.

 

(i)  Each Loan shall bear interest as follows:
(A) unless the Default Rate shall apply, each Base Rate Loan shall bear
interest on each day outstanding at the Base Rate plus the Applicable Margin in
effect on such day, and each LIBOR Loan shall bear interest on each day during
the related Interest Period at the related LIBOR Rate plus the Applicable
Margin in effect on such day, and (B) during a Default Rate Period, all Loans
shall bear interest on each day outstanding at the applicable Default Rate.

 

23

 

(ii)  If an Event of Default based upon Section
8.1(a), Section 8.1(b) or Section 8.1(h)(i), (h)(ii) or (h)(iii) exists
and the Loans are not bearing interest at the Default Rate, the past due
principal and past due interest shall bear interest on each day outstanding at
the applicable Default Rate.

 

(iii)  The interest rate shall change whenever the
applicable Base Rate, LIBOR Rate or Applicable Margin changes.  In no event shall the interest rate on any
Loan exceed the Highest Lawful Rate.

 

(b)  Facility Fee.  In consideration of Lenders’ agreement to
consider financing requests of Borrower hereunder, Borrower agrees to pay to
Administrative Agent for the account of each Lender in proportion to its
Percentage Share, a facility fee equal to one-twentieth percent (0.05%) of the
Maximum Facility Amount, due and payable on the date hereof.

 

(c)  Administrative Agent’s Fees.  In addition to all other amounts due to
Administrative Agent under the Loan Documents, Borrower will pay fees to
Administrative Agent as described in the fee letter dated October 20, 2003
between Administrative Agent and Borrower.

 

Section 2.7.  Optional Prepayments.  Borrower may, upon three Business Days’
notice, as to LIBOR Loans, or same Business Day’s notice, as to Base Rate
Loans, to Administrative Agent (and Administrative Agent will promptly give
notice to the other Lenders) from time to time and without premium or penalty
prepay the Loans, in whole or in part, so long as the aggregate amounts of all
partial prepayments of principal on the Loans equals $2,500,000 or any higher
integral multiple of $250,000.  Upon
receipt of any such notice, Administrative Agent shall give each Lender prompt
notice of the terms thereof.  Each
prepayment of principal of a Loan under this section shall be accompanied by
all interest then accrued and unpaid on the principal so prepaid.  Any principal or interest prepaid pursuant
to this section shall be in addition to, and not in lieu of, all payments
otherwise required to be paid under the Loan Documents at the time of such
prepayment.  Following notice by
Borrower pursuant to the foregoing, Borrower shall make such prepayment, and
the prepayment amount specified in such notice shall be due and payable, on the
date specified in such notice.

 

Section 2.8.  Mandatory Prepayments and Payments.

 

(a)  If at any time the Facility Usage exceeds
the Maximum Facility Amount, Borrower shall immediately upon demand prepay the
principal of the Loans in an amount at least equal to such excess.  Each prepayment of principal under this
section shall be accompanied by all interest then accrued and unpaid on the
principal so prepaid.  Any principal or
interest prepaid pursuant to this section shall be in addition to, and not in lieu
of, all payments otherwise required to be paid under the Loan Documents at the
time of such prepayment.

 

(b) If any
contract pursuant to which the Sale Value of any Hedged Eligible Inventory is
modified, sold or exchanged in any way that would negatively affect the Sale
Value of such Hedged Eligible Inventory following the delivery of the Financing
Request-Final with respect thereto, Borrower shall immediately (i) notify
Administrative Agent of such decreased Sale Value, and the Financing
Request-Final shall be deemed supplemented thereby, and (ii) prepay 

 

24

 

any outstanding Loans with respect to such Hedged Eligible Inventory in
an amount equal to 90% of such decrease in Sale Value.

 

(c) Each Loan
by a Participating Lender hereunder shall constitute a term loan due and
payable on the Settlement Date occurring in the month next following the month
in which such Loan was funded, accompanied by all interest then accrued and
unpaid on such Loan.

 

(d) On the
Request Period Termination Date (i) any outstanding Letters of Credit shall
continue to be outstanding according to their terms until their expiration or
retirement/cancellation pursuant to a related Loan as set forth herein, (ii)
any outstanding Loans shall be due and payable as set forth in Section 2.8(c)
above, and (iii) any commitments to participate in Letters of Credit or make
Loans for Cash and Carry Purchases of Hedged Eligible Inventory, and any
Letters of Credit issued or Loans made thereafter pursuant thereto, shall
remain outstanding as set forth herein; provided, all such commitments,
Letters of Credit and Loans shall be terminated, cancelled or paid in full on
or before the Maturity Date.

 

Section 2.9.  Extension of Request Period.

 

(a) Borrower
may, at its option and from time to time during the Request Period, request
that Lenders extend the Request Period Termination Date by delivering to
Administrative Agent a written request made by Borrower to each Lender to
extend the Request Period Termination Date for an additional year not more than
forty-five days and not less than thirty days prior to the then current Request
Period Termination Date.  Administrative
Agent shall forthwith provide a copy of the request to each Lender.  Upon receipt from Administrative Agent of
such request, each Lender shall, within fifteen days after the date of such
Lender’s receipt of such request from Administrative Agent, notify
Administrative Agent of its acceptance (and the terms and conditions, if any,
upon which such Lender is prepared to extend the Request Period Termination
Date) or rejection of such request.  The
failure of a Lender to so notify Administrative Agent within such twenty day
period shall be deemed to be notification by such Lender to Administrative
Agent that such Lender has denied such request.

 

(b)  Following any Lender’s or Lenders’ notice to
Administrative Agent pursuant to Section 2.9(a) that such Lender or Lenders
accept such request, such acceptance having common terms and conditions, Administrative
Agent shall deliver to Borrower such offer incorporating the said terms and
conditions.  Such offer shall be open
for acceptance by Borrower until the fifth Business Day immediately preceding
the then current Request Period Termination Date.  Upon written notice by Borrower to Administrative Agent accepting
such offer and agreeing to the terms and conditions, if any, specified therein
(the date of such notice of acceptance being called the “Extension Date”),
the Request Period Termination Date shall be extended to the date one year from
the Extension Date and the terms and conditions specified in such offer shall
be immediately effective.

 

(c)  Upon Borrower’s acceptance of Lenders’ offer
to extend the Request Period Termination Date, any Lender that rejected
Borrower’s extension request shall have no obligation to evaluate any Financing
Request-Initial received on or after the Extension Date, but any such Lender
that is a Participating Lender with respect to any previously approved
Financing Request-

 

25

 

Initial shall be obligated to participate in Letters of Credit issued
after the Extension Date pursuant to such approved Financing Request-Initial
and/or make Loans after the Extension Date pursuant to such approved Financing
Request-Initial.

 

(d)  Borrower understands that the consideration
of any request constitutes an independent credit decision which each Lender
retains the absolute and unfettered discretion to make and that no commitment
in this regard is hereby given by a Lender and that any offer to extend the
Request Period Termination Date may be on such terms and conditions in addition
to those set out herein as the extending Lenders stipulate.

 

Section 2.10.  Letters of Credit.  Subject to the terms and conditions hereof,
Borrower may request LC Issuer to issue any Letter of Credit that Participating
Lenders have agreed to participate in pursuant to and subject to the terms of
Section 2.1(c) (or amend, or extend the expiration date of, one or more
such Letters of Credit), provided that, after taking such Letter of Credit (or
amendment or extension) into account:

 

(a)  the Facility Usage does not
exceed the Maximum Facility Amount;

 

(b) the face amount of such Letter of Credit does not exceed the
aggregate Percentage Share of Participating Lenders with respect to such Letter
of Credit times ninety percent (90%) of the Hedged Value of the Hedged Eligible
Inventory subject to the Cash and Carry Purchase thereof pursuant to the
LC-Backed Purchase Contract secured by such Letter of Credit;

 

(c) the expiration date of such Letter of Credit is prior to 70 days
after the date of issuance of such Letter of Credit;

 

(d) such Letter of Credit is used to secure the Cash and Carry Purchase
by Borrower of Hedged Eligible Inventory pursuant to an LC-Backed Purchase
Contract and is substantially in the form of Exhibit E hereto or such other
form and terms as shall be acceptable to LC Issuer in its sole and absolute
discretion;

 

(e)  the issuance of such Letter
of Credit will be in compliance with all applicable governmental restrictions,
policies, and guidelines and will not subject LC Issuer to any cost which
is not reimbursable under Article III; and

 

(f)  all other conditions in
this Agreement to the issuance of such Letter of Credit have been satisfied.

 

LC Issuer will honor any such
request if the foregoing conditions (a) through (f) (in the following Section
2.11 called the “LC Conditions”) have been met as of the date of
issuance, amendment, or extension of the expiration, of such Letter of
Credit.  Letters of Credit shall be
issued in Dollars.

 

Section 2.11.  Requesting Letters of Credit.  Borrower must make written application for
any Letter of Credit at least two Business Days before the date on which Borrower
desires for LC Issuer to issue such Letter of Credit.  By making any such written application, unless otherwise 

 

26

 

expressly stated therein, Borrower shall be deemed to have represented
and warranted that the LC Conditions described in Section 2.10 will be met as
of the date of issuance of such Letter of Credit.  Each such written application for a Letter of Credit must be made
in writing in the form and substance of Exhibit F, and the terms and provisions
of which are hereby incorporated herein by reference (or in such other form as
may mutually be agreed upon by LC Issuer and Borrower).  If all LC Conditions for a Letter of Credit
have been met as described in Section 2.10 on any Business Day before 11:00
a.m. Boston, Massachusetts time, LC Issuer will issue such Letter of Credit on
the same Business Day at LC Issuer’s office in Boston, Massachusetts.  If the LC Conditions are met as described in
Section 2.10 on any Business Day on or after 11:00 a.m. Boston, Massachusetts
time, LC Issuer will issue such Letter of Credit on the next succeeding
Business Day at LC Issuer’s office in Boston, Massachusetts.  If any provisions of any LC Application
conflict with any provisions of this Agreement, the provisions of this
Agreement shall govern and control.

 

Section 2.12.  Reimbursement and Participations.

 

(a)  Reimbursement by Borrower.  Each Matured LC Obligation shall constitute
a loan by LC Issuer to Borrower. 
Borrower promises to pay to LC Issuer, or to LC Issuer’s order, on
demand, the full amount of each Matured LC Obligation, together with interest
thereon  (i) at the Base Rate plus the
Applicable Margin to and including the second Business Day after the Matured LC
Obligation is incurred and (ii) at the Default Rate on each day thereafter.

 

(b)  Letter of Credit Advances.  If the beneficiary of any Letter of Credit
makes a draft or other demand for payment thereunder then Borrower may, during
the interval between the making thereof and the honoring thereof by LC Issuer,
request Lenders to make Loans to Borrower in the amount of such draft or
demand, which Loans shall be made concurrently with LC Issuer’s payment of such
draft or demand and shall be immediately used by LC Issuer to repay the amount
of such resulting Matured LC Obligation. 
Such a request by Borrower shall be made in compliance with all of the
provisions hereof, provided that for the purposes of the first sentence of
Section 2.1, the amount of such Loans shall be considered, but the amount of
the Matured LC Obligation to be concurrently paid by such Loans shall not be
considered.

 

(c)  Participation by Lenders.  LC Issuer irrevocably agrees to grant and
hereby grants to each Lender, and — to induce LC Issuer to issue Letters of
Credit hereunder — each Lender irrevocably agrees to accept and purchase and
hereby accepts and purchases from LC Issuer, on the terms and conditions
hereinafter stated and for such Lender’s own account and risk an undivided
interest equal to such Lender’s Percentage Share of LC Issuer’s obligations and
rights under each Letter of Credit issued hereunder and the amount of each
Matured LC Obligation paid by LC Issuer thereunder.  Each Lender unconditionally and irrevocably agrees with LC Issuer
that, if a Matured LC Obligation is paid under any Letter of Credit for which
LC Issuer is not reimbursed in full by Borrower in accordance with the terms of
this Agreement and the related LC Application (including any reimbursement by
means of concurrent Loans or by the application of LC Collateral), such Lender
shall (in all circumstances and without set-off or counterclaim) pay to LC
Issuer, on demand, in immediately available funds at such LC Issuer’s address
for notices hereunder, such Lender’s Percentage Share of such Matured LC
Obligation (or any portion thereof which has not been reimbursed by
Borrower).  Each Lender’s obligation to 

 

27

 

pay LC Issuer pursuant to the terms of this subsection is irrevocable
and unconditional.  If any amount
required to be paid by any Lender to LC Issuer pursuant to this subsection is
paid by such Lender to LC Issuer within three Business Days after the date such
payment is due, LC Issuer shall in addition to such amount be entitled to
recover from such Lender, on demand, interest thereon calculated from such due
date at the Federal Funds Rate.  If any
amount required to be paid by any Lender to LC Issuer pursuant to this
subsection is not paid by such Lender to LC Issuer within three Business Days
after the date such payment is due, LC Issuer shall in addition to such amount
be entitled to recover from such Lender, on demand, interest thereon calculated
from such due date at the Base Rate plus the Applicable Margin.

 

(d)  Distributions to Participants.  Whenever LC Issuer has in accordance with
this section received from any Lender payment of such Lender’s Percentage Share
of any Matured LC Obligation, if LC Issuer thereafter receives any payment of
such Matured LC Obligation or any payment of interest thereon (whether directly
from Borrower or by application of LC Collateral or otherwise, and excluding
only interest for any period prior to LC Issuer’s demand that such Lender make
such payment of its Percentage Share), LC Issuer will distribute to such Lender
its Percentage Share of the amounts so received by LC Issuer; provided, however,
that if any such payment received by LC Issuer must thereafter be returned by
LC Issuer, such Lender shall return to LC Issuer the portion thereof which LC
Issuer has previously distributed to it.

 

(e)  Calculations.  A written advice setting forth in reasonable
detail the amounts owing under this section, submitted by LC Issuer to the
Borrower or any Lender from time to time, shall be conclusive, absent manifest
error, as to the amounts thereof.

 

Section 2.13.  Letter of Credit Fees.  In consideration of LC Issuer’s issuance of
any Letter of Credit, Borrower agrees to pay (i) to Administrative Agent for
the account of each Lender in proportion to its Percentage Share, a Letter of
Credit fee equal to the Letter of Credit Fee Rate applicable each day times the
undrawn face amount of such Letter of Credit and (ii) to LC Issuer for its own
account, a letter of credit fronting fee at a rate equal to one-eighth percent
(.125%) per annum times the undrawn face amount of such Letter of Credit.  Each such fee will be calculated on the
undrawn face amount of each Letter of Credit outstanding on each day at the
above applicable rates and will be payable quarterly in arrears on the last day
of each March, June, September and December. 
In addition, Borrower will pay to LC Issuer a minimum administrative
issuance fee and such other fees and charges customarily charged by LC Issuer
in respect of any issuance, amendment or negotiation of any Letter of Credit
requested by Borrower in accordance with LC Issuer’s published schedule of such
charges effective as of the date of such amendment or negotiation.

 

28

 

Section 2.14.  No Duty to Inquire.

 

(a)  Drafts and Demands.  LC Issuer is authorized and instructed to
accept and pay drafts and demands for payment under any Letter of Credit
without requiring, and without responsibility for, any determination as to the
existence of any event giving rise to said draft, either at the time of
acceptance or payment or thereafter.  LC
Issuer is not under any duty to determine the proper identity of anyone
presenting such a draft or making such a demand (whether by tested telex or
otherwise) as the officer, representative or agent of any beneficiary under any
Letter of Credit, and payment by LC Issuer to any such beneficiary when
requested by any such purported officer, representative or agent is hereby
authorized and approved.  Borrower
releases each Lender Party from, and agrees to hold each Lender Party harmless
and indemnified against, any liability or claim in connection with or arising
out of the subject matter of this section, which
indemnity shall apply whether or not any such liability or claim is in any way
or to any extent caused, in whole or in part, by any negligent act or omission
of any kind by any Lender Party, provided only that no Lender Party
shall be entitled to indemnification for that portion, if any, of any liability
or claim which is proximately caused by its own individual gross negligence or
willful misconduct, as determined in a final judgment.

 

(b)  Extension of Maturity.  If the maturity of any Letter of Credit is
extended by its terms or by Law or governmental action, if any extension of the
maturity or time for presentation of drafts or any other modification of the
terms of any Letter of Credit is made at the request of Borrower, or if the
amount of any Letter of Credit is increased at the request of Borrower, this
Agreement shall be binding upon Borrower with respect to such Letter of Credit
as so extended, increased or otherwise modified, with respect to drafts and
property covered thereby, and with respect to any action taken by LC Issuer, LC
Issuer’s correspondents, or any Lender Party in accordance with such extension,
increase or other modification.

 

(c)  Transferees of Letters of Credit.  If any Letter of Credit provides that it is
transferable, LC Issuer shall have no duty to determine the proper identity of
anyone appearing as transferee of such Letter of Credit, nor shall LC Issuer be
charged with responsibility of any nature or character for the validity or
correctness of any transfer or successive transfers, and payment by LC Issuer
to any purported transferee or transferees as determined by LC Issuer is hereby
authorized and approved, and Borrower releases each Lender Party from, and
agrees to hold each Lender Party harmless and indemnified against, any
liability or claim in connection with or arising out of the foregoing, which
indemnity shall apply whether or not any such liability or claim is in any way
or to any extent caused, in whole or in part, by any negligent act or omission
of any kind by any Lender Party, provided only that no Lender Party shall be
entitled to indemnification for that portion, if any, of any liability or claim
which is proximately caused by its own individual gross negligence or willful
misconduct, as determined in a final judgment.

 

Section 2.15.  LC Collateral.

 

(a)  LC Obligations in Excess of Maximum
Facility Amount.  If, after the
making of all mandatory prepayments required under Section 2.8, the outstanding
LC Obligations will exceed 

 

29

 

the Maximum Facility Amount, Borrower will immediately deposit with LC
Issuer an amount equal to such excess. 
LC Issuer will hold such amount as collateral security for such
remaining LC Obligations (all such amounts held as collateral security for LC
Obligations being herein collectively called “LC Collateral”) and the
other Obligations, respectively, and such collateral may be applied from time
to time to any Matured LC Obligations or, if any Event of Default shall then
exist, any other Obligations which are due and payable; provided, upon
the reduction of such outstanding LC Obligations pursuant to the termination or
cancellation of any Letter of Credit with respect thereto, LC Issuer shall
release LC Collateral in an amount equal to the amount of such terminated or
canceled Letter of Credit, and in the event the LC Obligations shall no longer
exceed the Maximum Facility Amount LC Issuer shall release all such LC
Collateral.  Neither this subsection nor
the following subsection shall, however, limit or impair any rights which LC
Issuer may have under any other document or agreement relating to any Letter of
Credit, LC Collateral or LC Obligations, including any LC Application, or any
rights which any Lender Party may have to otherwise apply any payments by
Borrower and any LC Collateral under Section 3.1.

 

(b)  Acceleration of LC Obligations.  If the Obligations or any part thereof
become immediately due and payable pursuant to Section 8.1 then, unless all
Lenders otherwise specifically elect to the contrary (which election may
thereafter be retracted by any Lender at any time), all LC Obligations shall
become immediately due and payable without regard to whether or not actual
drawings or payments on the Letters of Credit have occurred, and Borrower shall
be obligated to deposit with LC Issuer immediately an amount equal to the
aggregate LC Obligations with respect to Letters of Credit which are then
outstanding to be held as LC Collateral by LC Issuer as set forth above.

 

(c)  Investment of LC Collateral.  Pending application thereof, all LC
Collateral shall be invested by LC Issuer in such Cash Equivalents as LC Issuer
may choose in its sole discretion.  All
interest on (and other proceeds of) such Investments shall be reinvested or
applied to Matured LC Obligations or the Loans which are due and payable.  With respect to any LC Collateral delivered
pursuant to clause (b) above, when all Obligations have been satisfied in full,
including all LC Obligations, all Letters of Credit have expired or been
terminated, and all of Borrower’s reimbursement obligations in connection
therewith have been satisfied in full, LC Issuer shall release any remaining LC
Collateral.  Borrower hereby assigns and
grants to LC Issuer for the benefit of Lenders a continuing security interest
in all LC Collateral paid by it to LC Issuer, all Investments purchased with
such LC Collateral, and all proceeds thereof to secure its Matured LC
Obligations and its Obligations under this Agreement, each Note and the other
Loan Documents.  Borrower further agrees
that LC Issuer shall have all of the rights and remedies of a secured party
under the Uniform Commercial Code as adopted in the State of New York with
respect to such security interest and that an Event of Default under this
Agreement shall constitute a default for purposes of such security interest.

 

(d)  Payment of LC Collateral.  When Borrower is required to provide LC
Collateral for any reason and fails to do so on the day when required, LC
Issuer or Administrative Agent may without prior notice to Borrower provide
such LC Collateral (whether by transfers from other accounts maintained with LC
Issuer or otherwise) using any available funds of Borrower or any other Person
also liable to make such payments, and LC Issuer or Administrative Agent will
give 

 

30

 

notice thereof to Borrower promptly after such application or
transfer.  Any such amounts which are
required to be provided as LC Collateral and which are not provided on the date
required shall be considered past due Obligations owing hereunder, and LC
Issuer is hereby authorized to exercise its respective rights to obtain such
amounts.

 

ARTICLE III
- Payments to Lenders 

 

Section 3.1.  General Procedures.  Borrower shall pay all amounts owing with
respect to any Obligations (whether for principal, interest, fees, or
otherwise) to Administrative Agent for the account of the Lender Party to whom
such payment is owed in Dollars, without set-off, deduction or counterclaim
(other than netting with respect to Loans being made on a particular date and
repayment of prior Loans on such date as set forth in the last sentence of
Section 2.1(d), in immediately available funds.  Each payment under the Loan Documents must be received by
Administrative Agent not later than noon, Boston, Massachusetts time, on the
date such payment becomes due and payable. Any payment received by
Administrative Agent after such time will be deemed to have been made on the
next following Business Day.  Should any
such payment become due and payable on a day other than a Business Day, the
maturity of such payment shall be extended to the next succeeding Business Day,
and, in the case of a payment of principal or past due interest, interest shall
accrue and be payable thereon for the period of such extension as provided in the
Loan Document under which such payment is due. 
Each payment under a Loan Document to a Lender Party shall be due and
payable at the place provided therein and, if no specific place of payment is
provided, shall be due and payable at the place of payment of Administrative
Agent’s Note.

 

(a)  When Administrative Agent collects or
receives money on account of the Obligations, Administrative Agent shall
distribute all money so collected or received, and each Lender Party shall
apply all such money so distributed, as follows:

 

(i)  first, for the payment of
all Obligations which are then due (and if such money is insufficient to pay
all such Obligations, first to any reimbursements due Administrative Agent
under Section 10.4 and then to the partial payment of all other Obligations
then due in proportion to the amounts thereof, or as Lender Parties shall
otherwise agree);

 

(ii)  then for the prepayment of
amounts owing under the Loan Documents (other than principal on the Notes) if
so specified by Borrower;

 

(iii)  then for the prepayment
of principal on the Notes, together with accrued and unpaid interest on the
principal so prepaid, and then held as LC Collateral pursuant to Section 2.15;
and

 

(iv)  last, for the payment or
prepayment of any other Obligations.

 

All payments applied to
principal or interest on any Note shall be applied first to any interest then
due and payable, then to principal then due and payable, and last to any
prepayment of principal and accrued interest thereon in compliance with Sections
2.7 and 2.8, as applicable.  All
distributions of amounts described in any of subsections (ii), (iii), or (iv)
above shall be made by 

 

31

 

Administrative Agent pro rata
to each Lender Party then owed Obligations described in such subsection in
proportion to all amounts owed to all Lender Parties which are described in
such subsection; provided that if any Lender then owes payments to LC Issuer
for the purchase of a participation under Section 2.12(c) or to Administrative
Agent under Section 9.4, any amounts otherwise distributable under this section
to such Lender shall be deemed to belong to LC Issuer or Administrative Agent,
respectively, to the extent of such unpaid payments, and Administrative Agent shall
apply such amounts to make such unpaid payments rather than distribute such
amounts to such Lender.

 

Section 3.2.  Capital Reimbursement.  If either (a) the introduction or
implementation of or the compliance with or any change in or in the interpretation
of any Law, or (b) the introduction or implementation of or the compliance with
any request, directive or guideline from any central bank or other governmental
authority (whether or not having the force of Law) affects or would affect the
amount of capital required or expected to be maintained by any Lender Party or
any corporation controlling any Lender Party, then, within five Business Days
after demand by such Lender Party, Borrower will pay to Administrative Agent
for the benefit of such Lender Party, from time to time as specified by such
Lender Party, such additional amount or amounts which such Lender Party shall
determine to be appropriate to compensate such Lender Party or any corporation
controlling such Lender Party in light of such circumstances, to the extent
that such Lender Party reasonably determines that the amount of any such
capital would be increased or the rate of return on any such capital would be
reduced by or in whole or in part based on the existence of the face amount of
such Lender Party’s Loans, Letters of Credit, participations in Letters of
Credit or commitments under this Agreement.

 

Section 3.3.  Increased Cost of LIBOR Loans or Letters
of Credit.  If any applicable Law
(whether now in effect or hereinafter enacted or promulgated, including
Regulation D) or any interpretation or administration thereof by any
governmental authority charged with the interpretation or administration
thereof (whether or not having the force of Law):

 

(a)  shall change the basis of taxation of payments
to any Lender Party of any principal, interest, or other amounts attributable
to any LIBOR Loan or Letter of Credit or otherwise due under this Agreement in
respect of any LIBOR Loan or Letter of Credit (other than taxes imposed on, or
measured by, the overall net income of such Lender Party or any Applicable
Lending Office of such Lender Party by any jurisdiction in which such Lender
Party or any such Applicable Lending Office is located); or

 

(b)  shall change, impose, modify, apply or deem
applicable any reserve, special deposit or similar requirements in respect of
any LIBOR Loan or Letter of Credit (excluding those for which such Lender Party
is fully compensated pursuant to adjustments made in the definition of LIBOR
Rate) or against assets of, deposits with or for the account of, or credit
extended by, such Lender Party; or

 

(c)  shall impose on any Lender Party or the
interbank Eurocurrency deposit market any other condition affecting any LIBOR
Loan or Letter of Credit, the result of which is to increase the cost to any
Lender Party of funding or maintaining any LIBOR Loan or Letter of

 

32

 

Credit or to reduce the amount of any sum receivable by any Lender
Party in respect of any LIBOR Loan or Letter of Credit by an amount deemed by
such Lender Party to be material, then such Lender Party shall promptly notify
Administrative Agent and Borrower in writing of the happening of such event and
of the amount required to compensate such Lender Party for such event (on an
after-tax basis, taking into account any taxes on such compensation), whereupon
(i) Borrower shall, within five Business Days after demand therefor by such
Lender Party, pay such amount to Administrative Agent for the account of such
Lender Party and (ii) Borrower may elect, by giving to Administrative
Agent and such Lender Party not less than three Business Days’ notice, to
Convert all (but not less than all) of any such LIBOR Loans into Base Rate
Loans.

 

Section 3.4.  Notice; Change of Applicable Lending
Office.  A Lender Party shall notify
Borrower of any event occurring after the date of this Agreement that will
entitle such Lender Party to compensation under Section 3.2, 3.3, or 3.5 hereof
as promptly as practicable, but in any event within 180 days, after such Lender
Party obtains actual knowledge thereof; provided, that (i) if such
Lender Party fails to give such notice within 180 days after it obtains actual
knowledge of such an event, such Lender Party shall, with respect to compensation
payable pursuant to Section 3.2, 3.3, or 3.5 in respect of any costs
resulting from such event, only be entitled to payment under Section 3.2, 3.3,
or 3.5 hereof for costs incurred from and after the date 180 days prior to the
date that such Lender Party does give such notice and (ii) such Lender
Party will designate a different Applicable Lending Office for the Loans
affected by such event if such designation will avoid the need for, or reduce
the amount of, such compensation and will not, in the sole opinion of such
Lender Party, be disadvantageous to such Lender Party, except that such Lender
Party shall have no obligation to designate an Applicable Lending Office
located in the United States of America. 
Each Lender Party will furnish to Borrower a certificate setting forth
the basis and amount of each request by such Lender Party for compensation
under Section 3.2, 3.3, or 3.5 hereof.

 

Section 3.5.  Availability.  If (a) any change in applicable Laws, or in
the interpretation or administration thereof of or in any jurisdiction
whatsoever, domestic or foreign, shall make it unlawful or impracticable for
any Lender Party to fund or maintain LIBOR Loans or to issue or participate in
Letters of Credit, or shall materially restrict the authority of any Lender
Party to purchase or take offshore deposits of dollars (i.e., “Eurodollars”),
or (b) any Lender Party determines that matching deposits appropriate to fund
or maintain any LIBOR Loan are not available to it, or (c) any Lender Party
determines that the formula for calculating the LIBOR Rate does not fairly
reflect the cost to such Lender Party of making or maintaining loans based on
such rate, with respect to the transactions contemplated hereunder, then, upon
notice by such Lender Party to Borrower and Administrative Agent, Borrower’s
right to elect LIBOR Loans from such Lender Party (or, if applicable, to obtain
Letters of Credit) shall be suspended to the extent and for the duration of
such illegality, impracticability or restriction and all LIBOR Loans of such
Lender Party which are then outstanding or are then the subject of any
Borrowing Notice and which cannot lawfully or practicably be maintained or
funded shall immediately become or remain, or shall be funded as, Base Rate
Loans of such Lender Party.  With
respect to any commitment of any Lender hereunder, Borrower agrees to indemnify
each Lender Party extending credit pursuant thereto, and hold each such Lender
Party harmless against all costs,

 

33

 

expenses, claims, penalties, liabilities and damages which may result
from any such change in Law, interpretation or administration.  Such indemnification shall be on an
after-tax basis, taking into account any taxes imposed on the amounts paid as
indemnity.

 

Section 3.6.  Funding Losses.  In addition to its other obligations
hereunder, with respect to any commitment of any Lender hereunder, Borrower
will indemnify each Lender Party extending credit pursuant thereto against, and
reimburse each Lender Party on demand for, any loss or expense incurred or
sustained by such Lender Party (including any loss or expense incurred by
reason of the liquidation or reemployment of deposits or other funds acquired
by such Lender Party to fund or maintain LIBOR Loans), as a result of (a) any
payment or prepayment (whether or not authorized or required hereunder) of all
or a portion of a LIBOR Loan on a day other than the day on which the
applicable Interest Period ends, (b) any payment or prepayment, whether or not
required hereunder, of a Loan made after the delivery, but before the effective
date, of a Continuation/Conversion Notice, if such payment or prepayment
prevents such Continuation/Conversion Notice from becoming fully effective, (c)
the failure of any Loan to be made or of any Continuation/Conversion Notice to
become effective due to any condition precedent not being satisfied or due to
any other action or inaction of Borrower, or (d) any Conversion (whether or not
authorized or required hereunder) of all or any portion of any LIBOR Loan into
a Base Rate Loan or into a different LIBOR Loan on a day other than the day on
which the applicable Interest Period ends. 
Such indemnification shall be on an after-tax basis, taking into account
any taxes imposed on the amounts paid as indemnity.

 

Section 3.7.  Reimbursable Taxes.  With respect to any commitment by any Lender
hereunder, Borrower covenants and agrees with each Lender Party extending
credit pursuant thereto that:

 

(a)  Borrower will indemnify each such Lender Party
against and reimburse each such Lender Party for all present and future stamp
and other taxes, duties, levies, imposts, deductions, charges, costs, and
withholdings whatsoever imposed, assessed, levied or collected on or in respect
of this Agreement, any LIBOR Loans or Letters of Credit (whether or not legally
or correctly imposed, assessed, levied or collected), excluding, however, any
taxes imposed on or measured by the overall net income of Administrative Agent
or such Lender Party or any Applicable Lending Office of such Lender Party by
any jurisdiction in which such Lender Party or any such Applicable Lending
Office is located (all such non-excluded taxes, levies, costs and charges being
collectively called “Reimbursable Taxes” in this section).  Such indemnification shall be on an
after-tax basis, taking into account any taxes imposed on the amounts paid as
indemnity.

 

(b)  All payments on account of the principal of,
and interest on, each such Lender Party’s Loans and Note, and all other amounts
payable by Borrower to any such Lender Party hereunder, shall be made in full
without set-off or counterclaim and shall be made free and clear of and without
deductions or withholdings of any nature by reason of any Reimbursable Taxes,
all of which will be for the account of Borrower.  In the event of Borrower being compelled by Law to make any such
deduction or withholding from any payment to any such Lender Party, Borrower
shall pay on the due date of such payment, by way of additional interest, such
additional amounts as are needed to cause the amount receivable by such Lender
Party after such deduction or 

 

34

 

withholding to equal the amount which would have been receivable in the
absence of such deduction or withholding. 
If Borrower should make any deduction or withholding as aforesaid,
Borrower shall within 60 days thereafter forward to such Lender Party an
official receipt or other official document evidencing payment of such
deduction or withholding.

 

(c)  If Borrower is ever required to pay any
Reimbursable Tax with respect to any LIBOR Loan, Borrower may elect, by giving
to Administrative Agent and such Lender Party not less than three Business
Days’ notice, to Convert all (but not less than all) of any such LIBOR Loan
into a Base Rate Loan, but such election shall not diminish Borrower’s
obligation to pay all Reimbursable Taxes.

 

(d)  Notwithstanding the foregoing provisions of
this section, Borrower shall be entitled, to the extent it is required to do so
by Law, to deduct or withhold (and not to make any indemnification or
reimbursement for) income or other similar taxes imposed by the United States
of America (other than any portion thereof attributable to a change in federal
income tax Laws effected after the date hereof) from interest, fees or other
amounts payable hereunder for the account of such Lender Party, other than such
a Lender Party (i) who is a US person for Federal income tax purposes or
(ii) who has the Prescribed Forms on file with Administrative Agent (with
copies provided to the relevant Borrower) for the applicable year to the extent
deduction or withholding of such taxes is not required as a result of the
filing of such Prescribed Forms, provided that if Borrower shall so deduct or
withhold any such taxes, it shall provide a statement to Administrative Agent
and such Lender Party, setting forth the amount of such taxes so deducted or
withheld, the applicable rate and any other information or documentation which
such Lender Party may reasonably request for assisting such Lender Party to
obtain any allowable credits or deductions for the taxes so deducted or
withheld in the jurisdiction or jurisdictions in which such Lender Party is
subject to tax.  As used in this
section, “Prescribed Forms” means such duly executed forms or statements, and
in such number of copies, which may, from time to time, be prescribed by Law
and which, pursuant to applicable provisions of (x) an income tax treaty
between the United States and the country of residence of such Lender Party
providing the forms or statements, (y) the Code, or (z) any applicable rules or
regulations thereunder, permit Borrower to make payments hereunder for the
account of such Lender Party free of such deduction or withholding of income or
similar taxes.

 

Section 3.8.  Replacement of Lenders.  If any Lender Party seeks reimbursement for
increased costs under Sections 3.2 through 3.7, then within ninety days
thereafter — provided no Event of Default then exists — Borrower shall have the
right (unless such Lender Party withdraws its request for additional
compensation) to replace such Lender Party by requiring such Lender Party to
assign its Loans and Note and its commitments hereunder to an Eligible
Transferee reasonably acceptable to Administrative Agent and to Borrower,
provided that:  (i) all Obligations
of Borrower owing to such Lender Party being replaced (including such increased
costs and any breakage costs with respect to any outstanding LIBOR Loans, but
excluding principal and accrued interest on the Note being assigned) shall be
paid in full to such Lender Party concurrently with such assignment, and
(ii) the replacement Eligible Transferee shall purchase the Notes being
assigned by paying to such Lender Party a price equal to the principal amount
thereof plus accrued and unpaid interest. 
In connection with any such assignment Borrower, Administrative Agent,
such Lender Party and the replacement Eligible Transferee

 

35

 

shall otherwise comply with Section 10.5.  Notwithstanding the foregoing rights of
Borrower under this section, however, Borrower may not replace any Lender Party
which seeks reimbursement for increased costs under Section 3.2 through
3.7 unless Borrower is at the same time replacing all Lender Parties which are
then seeking such compensation.

 

ARTICLE IV - Conditions
Precedent to Lending

 

Section 4.1.  Documents to be Delivered.  No Lender has any obligation to make its
first Loan, and LC Issuer has no obligation to issue the first Letter of
Credit, unless Administrative Agent shall have received all of the following,
at Administrative Agent’s office in Boston, Massachusetts, duly executed and
delivered and in form, substance and date satisfactory to Administrative Agent,
each of which was so executed and delivered:

 

(a)  This Agreement and any
other document that Lenders are to execute in connection herewith.

 

(b)  Each Note and each Security Document.

 

(c)  Certain certificates
including:

 

(i)  An “Omnibus Certificate” of
the secretary or assistant secretary and any vice president of Plains Marketing
GP Inc., which shall contain the names and signatures of the officers of such
company authorized to execute Loan Documents and which shall certify to the
truth, correctness and completeness of the following exhibits attached
thereto:  (1) a copy of resolutions duly
adopted by the Board of Directors of such company and in full force and effect
at the time this Agreement is entered into, authorizing the execution of this Agreement
and the other Loan Documents delivered or to be delivered in connection
herewith and the consummation of the transactions contemplated herein and
therein, (2) a copy of the charter documents of Borrower and all amendments
thereto, certified by the appropriate official of its jurisdiction of
organization, and (3) a copy of the agreement of limited partnership of
Borrower;

 

(ii)  A certificate of the chief
financial officer of Plains Marketing GP Inc., regarding satisfaction of
Section 4.2; and

 

(d)  A certificate (or
certificates) of the due formation, valid existence and good standing of
Borrower in Delaware, issued by the Delaware Secretary of State.

 

(e)  Favorable opinions of Tim
Moore, Esq., General Counsel for Borrower, substantially in the form set forth
in Exhibit D-1, and Fulbright & Jaworski L.L.P., special Texas and New York
counsel to Borrower, substantially in the form set forth in Exhibit D-2.

 

(f) Financial projections for Borrower through December 2004, in form
and substance reasonably satisfactory to Administrative Agent.

 

36

 

(g)  Consolidated financial
statements of Borrower and its Subsidiaries as of September 30, 2003, together
with a certificate by the chief financial officer of GP Inc. certifying such
financial statements.

 

(h)  Administrative Agent shall
have received all documents and instruments which Administrative Agent has then
requested (including opinions of legal counsel for Borrower and Administrative
Agent; corporate documents and records; documents evidencing governmental
authorizations, consents, approvals, licenses and exemptions; and certificates
of public officials and of officers and representatives of Borrower and other
Persons), as to (i) the accuracy and validity of or compliance with all
representations, warranties and covenants made by Borrower in this Agreement
and the other Loan Documents, (ii) the satisfaction of all conditions contained
herein or therein, and (iii) all other matters pertaining hereto and thereto.  All such additional documents and
instruments shall be satisfactory to Administrative Agent in form and
substance.

 

(i)  Payment of all facility,
agency and other fees required to be paid to Administrative Agent or Lender
pursuant to any Loan Documents or any commitment agreement heretofore entered
into.

 

(j)  Evidence of the payment in
full of all outstanding Indebtedness under the Existing Agreements, the release
of all Liens securing such Indebtedness, and termination of the Existing
Agreements.

 

Section 4.2.  Additional Conditions Precedent.  No Lender has any obligation to make any
Loan (including its first), and LC Issuer has no obligation to issue any Letter
of Credit (including its first), unless the following conditions precedent have
been satisfied:

 

(a)  All representations and
warranties made by Borrower in any Loan Document shall be true on and as of the
date of such Loan or the date of issuance of such Letter of Credit as if such
representations and warranties had been made as of the date of such Loan or the
date of issuance of such Letter of Credit except to the extent that such
representation or warranty was made as of a specific date or updated, modified
or supplemented as of a subsequent date with the consent of Majority Lenders,
then in each such case, such other date.

 

(b)  No Default or “Default” (as
such term is used and defined in the PAA Credit Agreement) shall exist at the
date of such Loan or the date of issuance of such Letter of Credit or shall
result from such Loan or such issuance of such Letter of Credit.

 

ARTICLE V - Representations and Warranties 

 

To confirm
each Lender’s understanding concerning Borrower and its businesses, properties
and obligations, and to induce each Lender to enter into this Agreement,
consider financing requests of Borrower hereunder, and in each Lender’s sole
and absolute discretion extend credit hereunder, Borrower represents and
warrants to each Lender that:

 

37

 

Section 5.1.  No Default  No event has occurred and is continuing which constitutes a
Default, except as has been waived in accordance with this Agreement.

 

Section 5.2.  Organization and Good Standing.  Borrower is duly organized or formed,
validly existing and in good standing under the Laws of its jurisdiction of
organization or formation, having all requisite corporate or similar powers
required to carry on its business and enter into and carry out the transactions
contemplated hereby.  Borrower is duly
qualified, in good standing, and authorized to do business in all other
jurisdictions wherein the character of the properties owned or held by it or
the nature of the business transacted by it makes such qualification necessary
except where the failure to so qualify would not reasonably be expected to
cause a Material Adverse Change.

 

Section 5.3.  Authorization.  Borrower has duly taken all action necessary
to authorize the execution and delivery by it of the Loan Documents and to
authorize the consummation of the transactions contemplated thereby and the
performance of its obligations thereunder. 
Borrower is duly authorized to borrow funds hereunder.

 

Section 5.4.  No Conflicts or Consents.  The execution and delivery by Borrower of
the Loan Documents, the performance by it of its obligations, and the
consummation of the transactions contemplated thereby, do not and will not (i)
violate any provision of (1) Law applicable to it, (2) its organizational
documents or (3) any judgment, order or material license or permit applicable
to or binding upon it, (ii) result in the acceleration of any Indebtedness owed
by it or (iii) result in or require the creation of any consensual Lien upon
any of its material assets or properties except as expressly contemplated in,
or permitted by, the Loan Documents. 
Except as expressly contemplated in or permitted by the Loan Documents,
disclosed in the Disclosure Schedule or disclosed pursuant to Section 6.4, no
permit, consent, approval, authorization or order of, and no notice to or
filing, registration or qualification with, any Tribunal is required on the
part of Borrower pursuant to the provisions of any material Law applicable to
it as a condition to its execution, delivery or performance of any Loan
Document or (ii) to consummate any transactions contemplated by the Loan
Documents.

 

Section 5.5.  Enforceable Obligations.  This Agreement is, and the other Loan
Documents when duly executed and delivered will be, legal, valid and binding
obligations of Borrower, enforceable in accordance with their terms except as
such enforcement may be limited by bankruptcy, insolvency or similar Laws of
general application relating to the enforcement of creditors’ rights and
general principles of equity.

 

Section 5.6.  Initial Financial Statements.  Borrower has heretofore delivered to each
Lender true, correct and complete copies of the Initial Financial
Statements.  The Initial Financial
Statements fairly present PAA’s and Borrower’s Consolidated financial position
at the date thereof and the Consolidated results of PAA’s and Borrower’s
operations for the periods thereof, and in the case of the annual Initial
Financial Statements, Consolidated cash flows for the period thereof.  Since the date of the annual Initial
Financial Statements, no Material Adverse Change has occurred.  All Initial Financial Statements described
in clause (i) of that defined term were prepared in accordance with GAAP.

 

38

 

Section 5.7.  Other Obligations and Restrictions.  As of the closing date hereof, Borrower has
no outstanding payment obligations of any kind (including contingent
obligations, tax assessments and unusual forward or long-term commitments)
which are, in the aggregate, material to Borrower or material with respect to
Borrower’s Consolidated financial condition and not reflected in the Initial
Financial Statements, disclosed in the Disclosure Schedule or otherwise
permitted under Section 7.1.  Except as
disclosed in the Disclosure Schedule, Borrower is not subject to or restricted
by any franchise, contract, deed, charter restriction, or other instrument or
restriction which would reasonably be expected to cause a Material Adverse
Change.

 

Section 5.8.  Full Disclosure.  No certificate, statement or other
information delivered herewith or heretofore by Borrower to any Lender in
connection with the negotiation of this Agreement or in connection with any
transaction contemplated hereby contains any untrue statement of a material
fact or omits to state any material fact necessary to make the statements
contained herein or therein, in light of the circumstances under which they
were made, not misleading as of the date made or deemed made (or if such
information expressly relates or refers to an earlier date, as of such earlier
date).  All written information
furnished after the date hereof by or on behalf of Borrower to Administrative
Agent or any Lender Party in connection with this Agreement and the other Loan
Documents and the transactions contemplated hereby and thereby will be true,
complete and accurate in every material respect in light of the circumstances
in which made or based on reasonable estimates, in each case as of the date on
which such information is stated or certified (or if such information expressly
relates or refers to an earlier date, as of such earlier date).  There is no fact known to Borrower that has
not been disclosed to each Lender in writing which would reasonably be expected
to cause a Material Adverse Change.

 

Section 5.9.  Litigation.  Except as disclosed in the Initial Financial Statements or in the
Disclosure Schedule:  (i) there are
no actions, suits or legal, equitable, arbitrative or administrative
proceedings pending, or to the knowledge of Borrower overtly threatened,
against Borrower or affecting any Collateral (including, without limitation,
any which challenge or otherwise pertain to Borrower’s title to any Collateral)
before any Tribunal which would reasonably be expected to cause a Material
Adverse Change, and (ii) there are no outstanding judgments, injunctions,
writs, rulings or orders by any such Tribunal against Borrower or, to the
knowledge of Borrower, Borrower’s stockholders, partners, directors or officers
or affecting any Collateral which would reasonably be expected to cause a
Material Adverse Change.

 

Section 5.10.  ERISA Plans and Liabilities.  All currently existing ERISA Plans are
listed in the Disclosure Schedule or pursuant to Section 6.4.  Except as disclosed in the Initial Financial
Statements, in the Disclosure Schedule or pursuant to Section 6.4, no
Termination Event has occurred with respect to any ERISA Plan and all ERISA
Affiliates are in compliance with ERISA in all material respects, to the extent
that the non-compliance therewith would not be reasonably expected to cause a
Material Adverse Change.  No ERISA
Affiliate is required to contribute to, or has any other absolute or contingent
liability in respect of, any “multiemployer plan” as defined in Section 4001 of
ERISA.  Except as set forth in the
Disclosure Schedule:  (i) no “accumulated
funding deficiency” (as defined in Section 412(a) of the Code) exists with
respect to any ERISA Plan, whether or not waived by the Secretary of the
Treasury or his delegate, and 

 

39

 

(ii) the current value of each ERISA Plan’s benefits does not exceed
the current value of such ERISA Plan’s assets available for the payment of such
benefits by more than $5,000,000.

 

Section 5.11.  Compliance with Permits, Consents and Law.  Except as set forth in the Disclosure
Schedule or pursuant to Section 6.4, Borrower has all permits, licenses and
authorizations required in connection with the conduct of its businesses,
except to the extent failure to have any such permit, license or authorization
would not reasonably be expected to cause a Material Adverse Change.  Borrower is in compliance with the terms and
conditions of all such permits, licenses and authorizations, and is also in
compliance with all other limitations, restrictions, conditions, standards,
prohibitions, requirements, obligations, schedules and timetables contained in
any Law, including applicable Environmental Law, or in any regulation, code,
plan, order, decree, judgment, injunction, notice or demand letter issued,
entered, promulgated or approved thereunder, except to the extent that
non-compliance therewith would not reasonably be expected to cause a Material
Adverse Change or such term, restriction or otherwise is being contested in
good faith or a bona fide dispute exists with respect thereto.

 

Section 5.12.  Environmental Laws.  Except as set forth in the Disclosure
Schedule or disclosed pursuant to Section 6.4, (i) Borrower and its
Subsidiaries are conducting their businesses in material compliance with all
applicable Laws, including Environmental Laws, and have and are in compliance
with all licenses and permits required under any such Laws, unless failure to
so comply or have such licenses and permits would not reasonably be expected to
cause a Material Adverse Change; (ii) none of the operations or properties
of Borrower or any of its Subsidiaries is the subject of federal, provincial or
local investigation evaluating whether any material remedial action is needed
to respond to a release of any Hazardous Materials into the environment or to
the improper storage or disposal (including storage or disposal at offsite
locations) of any Hazardous Materials, unless such remedial action would not
reasonably be expected to cause a Material Adverse Change; and
(iii) neither Borrower nor any of its Subsidiaries (and to the actual
knowledge of Borrower, no other Person) has filed any notice under any Law
indicating that Borrower or any of its Subsidiaries is responsible for the
improper release into the environment, or the improper storage or disposal, of any
material amount of any Hazardous Materials or that any Hazardous Materials have
been improperly released, or are improperly stored or disposed of, upon any
property of any such Person, other than of an alleged improper release, storage
or disposal that would not reasonably be expected to cause a Material Adverse
Change.

 

Section 5.13.  Accounts; Title to Properties.  All Accounts arising from with respect to
contracts for the sale of Financed Eligible Hedged Inventory shall qualify as
Approved Eligible Receivables, and Borrower has complied in all respects with
the terms of each related contract for sale. 
Borrower has good and defensible title to all of its material properties
and assets, free and clear of all Liens (other than Permitted Liens) and of all
impediments to the use of such properties and assets in its business, other
than such impediments that would not reasonably be expected to cause a Material
Adverse Change.

 

Section 5.14.  Government Regulation.  Borrower is not subject to regulation under
the Public Utility Holding Company Act of 1935, the Investment Company Act of
1940 (as any of the preceding acts have been amended) or any other Law which
regulates the incurring by 

 

40

 

Borrower of Indebtedness, including Laws relating to common contract
carriers or the sale of electricity, gas, steam, water or other public utility
services.  Borrower is not subject to
regulation under the Federal Power Act which would violate, result in a default
of, or prohibit the effectiveness or the performance of any of the provisions
of the Loan Documents.

 

Section 5.15.  Insider.  Neither Borrower, nor any Person having “control” (as that term
is defined in 12 U.S.C. § 375b(9) or in regulations promulgated pursuant thereto)
of Borrower, is a “director” or an “executive officer” or “principal
shareholder” (as those terms are defined in 12 U.S.C. § 375b(8) or (9) or in
regulations promulgated pursuant thereto) of any Lender, of a bank holding
company of which any Lender is a Subsidiary or of any Subsidiary of a bank
holding company of which any Lender is a Subsidiary.

 

Section 5.16.  Solvency.  Upon giving effect to the issuance of the Notes, the execution of
the Loan Documents by Borrower and the consummation of the transactions
contemplated hereby, (i) Borrower will be solvent (as such term is used in
applicable bankruptcy, liquidation, receivership, insolvency or similar Laws),
and the sum of Borrower’s absolute and contingent liabilities, including the
Obligations or guarantees thereof, shall not exceed the fair market value of
Borrower’s assets, and (ii) Borrower’s capital should be adequate for the
businesses in which it is engaged and intends to be engaged.  Borrower has not incurred (whether under the
Loan Documents or otherwise), nor does Borrower intend to incur or reasonably
foreseeably believes that it will incur, debts which will be beyond its ability
to pay as such debts mature.

 

Section 5.17.  Not a “Reportable Transaction”.  Borrower does not intend to treat the
Borrowings and/or Letters of Credit and related transactions as being a
“reportable transaction” (within the meaning of Treasury Regulation
Section 1.6011-4).  In the event
Borrower determines to take any action inconsistent with such intention, it will
promptly notify the Administrative Agent thereof.  If Borrower takes any action inconsistent with such intention, or
if Borrower so notifies the Administrative Agent, then Borrower acknowledges
that, as a result of such action or notice, one or more of the Lenders may
treat its Loans and/or its interest in Letters of Credit as part of a
transaction that is subject to Treasury Regulation Section 301.6112-1, and such
Lender or Lenders will maintain the lists and other records required by such
Treasury Regulation.

 

ARTICLE VI - Affirmative
Covenants  

 

To conform
with the terms and conditions under which each Lender is willing to consider
financing requests of Borrower hereunder and in each Lender’s sole and absolute
discretion extend credit to Borrower, and to induce each Lender to enter into
this Agreement, consider financing requests of Borrower hereunder and in each
Lender’s sole and absolute discretion extend credit hereunder, Borrower
covenants and agrees that so long as any Obligations or any commitment of any
Participating Lender to extend credit hereunder remains outstanding, unless
Majority Lenders, or all Lenders as required under Section 10.1, have
previously agreed otherwise:

 

Section 6.1.  Payment and Performance.  Borrower will pay all amounts due from it
pursuant to the provisions of the Loan Documents to which it is a party in
accordance with the 

 

41

 

terms thereof and will observe, perform and comply with every covenant,
term and condition imposed on it pursuant to the provisions of such Loan
Documents.

 

Section 6.2.  Books, Financial Statements and Reports.  Borrower will at all times maintain full and
accurate books of account and records. Borrower will maintain a standard system
of accounting, will maintain its Fiscal Year, and will furnish the following
statements and reports to each Lender at Borrower’s expense:

 

(a)  Promptly upon the filing thereof, and in any
event within ninety (90) days after the end of each Fiscal Year: (i) a copy of PAA’s
Form 10-K, which report shall include PAA’s complete Consolidated financial
statements together with all notes thereto, prepared in reasonable detail in
accordance with GAAP, together with an opinion, without material qualification,
based on an audit using generally accepted auditing standards, by
PricewaterhouseCoopers LLP, or other independent certified public accountants,
stating that such Consolidated financial statements have been so prepared, and
(ii) Borrower’s complete unaudited Consolidated financial statements, prepared
in reasonable detail in accordance with GAAP. 
These financial statements shall contain a Consolidated balance sheet as
of the end of such Fiscal Year and Consolidated statements of earnings for such
Fiscal Year.  Such Consolidated
financial statements shall set forth in comparative form the corresponding
figures for the preceding Fiscal Year.

 

(b)  Promptly upon the filing thereof, and in any
event within sixty (60) days after the end of each of the first three Fiscal
Quarters of each Fiscal Year: (i) a copy of PAA’s Form 10-Q, which report
shall include PAA’s unaudited Consolidated balance sheet as of the end of such
Fiscal Quarter and Consolidated statements of PAA’s earnings and cash flows for
such Fiscal Quarter and for the period from the beginning of the then current
Fiscal Year to the end of such Fiscal Quarter, and (ii) Borrower’s unaudited
Consolidated balance sheet as of the end of such.  Fiscal Quarter and Consolidated statements of Borrower’s earnings
and cash flows for such Fiscal Quarter and for the period from the beginning of
the then current Fiscal Year to the end of such Fiscal Quarter.  In addition Borrower will, together with
each such set of financial statements and each set of financial statements
furnished under subsection (a) of this section, furnish a copy of the
certificate delivered to the administrative agent and lenders under the PAA
Credit Agreement pursuant to Section 6.2(b) thereof.

 

(c)  Prompt notice of any publicly announced
change in PAA’s Debt Rating by either Standard & Poor’s or Moody’s.

 

Documents required to be
delivered pursuant to Section 6.2(a)(i) or (b)(i) (to the extent any such
documents are included in materials otherwise filed with the Securities and
Exchange Commission) may be delivered electronically and if so delivered, shall
be deemed to have been delivered on the date on which PAA posts such documents,
or provides a link thereto, on PAA’s website on the Internet at the website
address listed in Section 10.3, and notifies Administrative Agent of such
posting or link.

 

Section 6.3.  Other Information and Inspections.  In each case subject to the last sentence of
this Section 6.3, Borrower will furnish to Administrative Agent any information
which Administrative Agent or any Lender may from time to time reasonably
request concerning any 

 

42

 

covenant, provision or condition of the Loan Documents or any matter in
connection with Borrower’s businesses and operations.  In each case subject to the last sentence of this
Section 6.3, Borrower will permit representatives appointed by
Administrative Agent (including independent accountants, auditors, agents,
attorneys, appraisers and any other Persons), upon reasonable prior notice, to
visit and inspect during normal business hours any of Borrower’s property,
including its books of account, other books and records, and any facilities or
other business assets, and to make extra copies therefrom and photocopies and
photographs thereof, and to write down and record any information such
representatives obtain, and Borrower shall permit Administrative Agent or its
representatives to investigate and verify the accuracy of the information
furnished to Administrative Agent or any Lender in connection with the Loan
Documents and to discuss all such matters with its officers, employees and,
upon reasonable prior notice to Borrower, its representatives.  Each of the foregoing inspections and
examinations shall be made subject to compliance with applicable safety
standards and the same conditions applicable to Borrower in respect of property
of Borrower on the premises of Persons other than Borrower or an Affiliate of
Borrower, and all information, books and records furnished or requested to be
made, all information to be investigated or verified and all discussion
conducted with any officer, employee or representative of Borrower shall be
subject to any applicable attorney-client privilege exceptions which Borrower
determines is reasonably necessary and compliance with conditions to
disclosures under non-disclosure agreements between Borrower and Persons other
than Borrower or an Affiliate of Borrower and the express undertaking of each
Person acting at the direction of or on behalf of any Lender Party to be bound
by the confidentiality provisions of Section 10.6 of this Agreement.

 

Section 6.4.  Notice of Material Events.  Borrower will notify each Lender Party, not
later than five (5) Business Days after any executive officer of Borrower has
knowledge thereof, stating that such notice is being given pursuant to this
Agreement, of:

 

(a)  the occurrence of any
Material Adverse Change,

 

(b)  the occurrence of any
Default,

 

(c)  the acceleration of the
maturity of any Indebtedness owed by Borrower or of any default by Borrower
under any indenture, mortgage, agreement, contract or other instrument to which
it is a party or by which it or any of its properties is bound, if such
acceleration or default would reasonably be expected to cause a Material
Adverse Change,

 

(d)  the occurrence of any
Termination Event,

 

(e)  any claim under any
Environmental Law adverse to Borrower or of potential liability with respect to
such claim, or any other adverse claim asserted against Borrower or with
respect to Borrower’s properties taken as a whole, in each case, which claim
would reasonably be expected to cause a Material Adverse Change, and

 

43

 

(f)  the filing of any suit or
proceeding, or the assertion in writing of a claim against Borrower or with
respect to Borrower’s properties, which would reasonably be expected to cause a
Material Adverse Change.

 

Upon the occurrence of any of
the foregoing Borrower will take all necessary or appropriate steps to remedy
promptly, if applicable, any such Material Adverse Change, Default,
acceleration, default or Termination Event, to protect against any such adverse
claim, to defend any such claim, suit or proceeding, and to resolve all
controversies on account of any of the foregoing.

 

Section 6.5.  Maintenance of Existence, Qualifications
and Assets.  Borrower (i) will
maintain and preserve its existence and its rights (including permits, licenses
and other authorizations required under Environmental Laws) and franchises in
full force and effect, (ii) will qualify to do business in all states or
jurisdictions where required by applicable Law, and (iii) keep all Collateral
and its other material assets that are useful in and necessary to its business
in good working order and condition (ordinary wear and tear and obsoleteness
excepted) except, in each case (a) where the failure so to maintain, preserve,
qualify or keep would not be reasonably expected to cause a Material Adverse
Change, (b) as permitted in Section 7.3 or as a result of statutory conversions
or (c) as a result of a release permitted pursuant to Section 6.9.  Borrower will also notify Administrative
Agent in writing at least twenty Business Days prior to the date that Borrower
changes its name or the location of its chief executive office or principal
place of business or the place where it keeps its books and records concerning
the Collateral, furnishing with such notice any necessary financing statement
amendments or requesting Administrative Agent to prepare the same.

 

Section 6.6.  Payment of Taxes, etc.  Borrower will (a) timely file all required
tax returns (including any extensions), (b) timely pay all taxes, assessments,
and other governmental charges or levies imposed upon it or upon its income,
profits or property, and (c) maintain appropriate accruals and reserves
for all of the foregoing as required by GAAP, except to the extent that (y) it
is in good faith contesting the validity thereof by appropriate proceedings, if
necessary, and has set aside on its books adequate reserves therefor which are
required by GAAP or (z) such non-filing, non-payment or non-maintenance would
not reasonably be expected to cause a Material Adverse Change.

 

Section 6.7.  Insurance.  In accordance with industry standards, Borrower will keep insured
(by responsible and reputable insurance companies or associations) or
self-insured, at the option of Borrower, in such amounts and against such risks
as are usually insured by Persons engaged in the same or similar businesses and
owning similar properties.  The
insurance coverages and amounts will be reasonably determined by Borrower,
based on coverages carried by prudent owners of similar property, and may be
maintained by PAA.

 

Section 6.8.  Compliance with Agreements and Law.  Borrower will strictly perform and comply
with the terms of each contract for the sale of Hedged Eligible Inventory and
will perform all other material obligations it is required to perform under the
terms of each indenture, mortgage, deed of trust, security agreement, lease,
franchise and other material agreement, contract or other instrument (including
all contractual obligations and agreements with respect to environmental
remediation or other environmental matters) to which it is a party or by which
it or 

 

44

 

any of its properties is bound to the extent that non-performance
therewith would not reasonably be expected to cause a Material Adverse
Change.  Borrower will conduct its
business and affairs in compliance, in all material respects, with all Laws
(including Environmental Laws) applicable thereto to the extent non-compliance
therewith would not reasonably be expected to cause a Material Adverse Change
or such requirement of Law is being contested in good faith or a bona fide dispute
exists with respect thereto.

 

Section 6.9.  Agreement to Deliver Security Documents.  Borrower will deliver, to further secure the
Obligations whenever requested by Administrative Agent in its sole and absolute
discretion, chattel mortgages, security agreements, financing statements and
other Security Documents in form and substance satisfactory to Administrative
Agent for the purpose of granting, confirming, and perfecting first and prior
liens or security interests, subject to applicable Liens permitted pursuant to
Section 7.1, in (i) all Financed Hedged Eligible Inventory, (ii) all Hedging
Contracts covering Financed Hedged Eligible Inventory, (iii) all contracts for
the sale of Financed Hedged Eligible Inventory and Accounts arising thereunder,
and (iv) all proceeds of the foregoing.

 

Section 6.10.  Perfection and Protection of Security
Interests and Liens.  Borrower will
from time to time deliver to Administrative Agent any financing statements,
continuation statements, extension agreements and other documents, properly
completed and executed (and acknowledged when required) by Borrower in form and
substance satisfactory to Administrative Agent, which Administrative Agent
requests for the purpose of perfecting, confirming, or protecting any Liens or
other rights in Collateral securing any Obligations.

 

ARTICLE VII - Negative
Covenants 

 

To conform
with the terms and conditions under which each Lender is willing to consider
financing requests of Borrower hereunder and in each Lender’s sole and absolute
discretion extend credit to Borrower, and to induce each Lender to enter into
this Agreement, consider financing requests of Borrower hereunder and in each
Lender’s sole and absolute discretion extend credit hereunder, Borrower
covenants and agrees that so long as any Obligations or any commitment of any
Participating Lender to extend credit hereunder remains outstanding, unless
Majority Lenders, or all Lenders as required under Section 10.1, have
previously agreed otherwise:

 

Section 7.1.  Limitation on Liens.  Borrower will not create, assume or permit
to exist:

 

(i) any
Lien upon any Collateral except (A) Liens created pursuant to the Security
Documents, (B) Permitted Inventory Liens, (C) statutory Liens in respect of
First Purchase Crude Payables, (D) Broker Liens on margin deposits with respect
to Hedging Contracts, and (E) any other Liens expressly permitted to encumber
such Collateral under any Security Document; or

 

(ii) any Lien
on any Petroleum Products commingled with Financed Hedged Eligible Inventory,
or on any sales contracts (and Accounts therefrom and proceeds thereof)
covering Petroleum Products in addition to Financed Hedged Eligible Inventory,
or with respect to any Hedging Contracts covering Financed Hedged Eligible
Inventory, other than Broker Liens on 

 

45

 

margin deposits with respect thereto, unless such lien creditor has
agreed in writing that Administrative Agent’s and Lenders’ rights with respect
to such Petroleum Products, sales contracts, Hedging Contracts and collateral
rights related thereto are first and prior to such lien creditor’s rights
therein;

 

Section 7.2.  Limitation on Mergers.  Except as expressly provided in this
section, Borrower will not (a) merge or consolidate or amalgamate with any
Person, or liquidate, wind up or dissolve or (b) sell, transfer, lease,
exchange or otherwise dispose of, in one transaction or a series of related
transactions, all or substantially all of its business or property, whether now
owned or hereafter acquired, to any Person; provided, Borrower may (A)
merge into or consolidate or amalgamate with any Subsidiary of PAA; provided,
Borrower is the surviving business entity and after giving effect thereto, no
Default exists.

 

Section 7.3.  Limitation on Sales of Collateral.  Borrower will not sell, transfer, lease,
exchange, alienate or dispose of any Collateral except in the ordinary course
of business on ordinary trade terms.

 

Section 7.4.  Limitation on New Businesses.  Borrower will not materially or
substantially engage directly or indirectly in any business or conduct any
operations other than (i) marketing, gathering, transporting (by barge,
pipeline, ship, truck or other modes of hydrocarbon transportation),
terminalling, storing, producing, acquiring, developing, exploring for,
exploiting, producing, processing, dehydrating and otherwise handling
hydrocarbons, including, without limitation, constructing pipeline, platform,
dehydration, processing and other energy-related facilities, (ii) any other
business that generates gross income that constitutes “qualifying income” under
Section 7704(d) of the Internal Revenue Code of 1986, as amended, or (iii)
activities or services reasonably related or ancillary thereto including
entering into hedging obligations to support those businesses.

 

Section 7.5.  No Negative Pledges.  Except as described in the Disclosure
Schedule or pursuant to a Restriction Exception, the substance of which, in
detail satisfactory to Administrative Agent, is promptly reported to
Administrative Agent, Borrower will not, directly or indirectly, enter into,
create, or consent to be bound to any contract or other consensual restriction
that restricts the ability of Borrower to create or maintain Liens on its
assets in favor of Administrative Agent, LC Issuer and Lenders to secure, in
whole or part, the Obligations.

 

ARTICLE VIII -
Events of Default and Remedies 

 

Section 8.1.  Events of Default.  Each of the following events constitutes an
Event of Default under this Agreement:

 

(a)  Borrower fails to pay the principal
component of any Loan or any reimbursement obligation with respect to any
Letter of Credit when due and payable, whether at a date for the payment of a
fixed installment or as a contingent or other payment becomes due and payable
or as a result of acceleration or otherwise;

 

(b) Borrower
fails to pay any Obligation for which it is contractually liable (other than
the Obligations in subsection (a) above) when due and payable, whether at a
date for the payment of 

 

46

 

a fixed installment or as a contingent or other payment becomes due and
payable or as a result of acceleration or otherwise, within three Business Days
after the same becomes due;

 

(c) Borrower
fails to duly observe, perform or comply with any covenant, agreement or
provision of Section 6.4 or Article VII;

 

(d) Borrower
fails (other than as referred to in subsections (a), (b) or (c) above) to duly
observe, perform or comply with any of its obligations under any covenant,
agreement, condition or provision of any Loan Document to which it is a party,
and such failure remains unremedied for a period of thirty (30) days after
notice of such failure is given by Administrative Agent to Borrower;

 

(e)  Any representation or warranty previously,
presently or hereafter made in writing by or on behalf of Borrower in
connection with any Loan Document shall prove to have been false or incorrect
in any material respect on any date on or as of which made, or any Loan Document
at any time ceases to be valid, binding and enforceable as warranted in
Section 5.5 for any reason other than its release or subordination by
Administrative Agent;

 

(f) Borrower
shall default in the payment when due of any principal of or interest on any of
its other Indebtedness, or, as a result of an early termination event or
similar event, on any net hedging obligations, in excess of $15,000,000 in the
aggregate (other than such Indebtedness or hedging obligations the validity of
which is being contested in good faith, by appropriate proceedings (if
necessary) and for which adequate reserves with respect thereto are maintained
on the books of Borrower as required by GAAP), or any event specified in any
note, agreement, indenture or other document evidencing or relating to any such
Indebtedness or hedging obligations shall occur for a period beyond the
applicable grace, cure extension, forbearance or other similar period, if the
effect of such event is to cause, or (with the giving of any notice or the
lapse of time or both) to permit the holder or holders of such Indebtedness or
hedging obligations (or a trustee or agent on behalf of such holder or holders)
to cause, as applicable, such Indebtedness to become due, or to be prepaid in
full (whether by redemption, purchase, offer to purchase or otherwise), prior
to its stated maturity, or an early termination event or similar event to occur
and Borrower’s related net hedging obligations in excess of $15,000,000 to
become due and payable;

 

(g)  Either (i) any “accumulated funding
deficiency” (as defined in Section 
412(a) of the Code) in excess of $5,000,000 exists with respect to any
ERISA Plan, whether or not waived by the Secretary of the Treasury or his
delegate, or (ii) any Termination Event occurs with respect to any ERISA Plan
and the then current value of such ERISA Plan’s benefit liabilities exceeds the
then current value of such ERISA Plan’s assets available for the payment of
such benefit liabilities by more than $5,000,000 (or in the case of a Termination
Event involving the withdrawal of a substantial employer, the withdrawing
employer’s proportionate share of such excess exceeds such amount);

 

(h) Borrower,
any Subsidiary of Borrower, Plains All American GP LLC, Plains AAP, L.P., PAA,
or any “significant subsidiary” of PAA, as defined in Article 1, Rule 1-02 of

 

47

 

Regulation S-X, promulgated pursuant to the Securities Exchange Act of
1934 and the Securities Act of 1933, each as amended:

 

(i)  has entered against it a
judgment, decree or order for relief by a Tribunal of competent jurisdiction in
an involuntary proceeding commenced under any applicable bankruptcy, insolvency
or other similar Law of any jurisdiction now or hereafter in effect, including
the federal Bankruptcy Code, as from time to time amended, or has any such
proceeding commenced against it, in each case, which remains undismissed for a
period of sixty days; or

 

(ii)  commences a voluntary case
under any applicable bankruptcy, insolvency or similar Law now or hereafter in
effect, including the federal Bankruptcy Code, as from time to time amended; or
applies for or consents to the entry of an order for relief in an involuntary
case under any such Law; or makes a general assignment for the benefit of
creditors; or is generally unable to pay (or admits in writing its inability to
so pay) its debts as such debts become due; or takes corporate or other action
to authorize any of the foregoing; or

 

(iii)  has entered against it
the appointment of or taking possession by a receiver, liquidator, assignee,
custodian, trustee, sequestrator or similar official of any Collateral or all
or a substantial part of its assets in a proceeding brought against or
initiated by it, and such appointment or taking possession is neither made
ineffective nor discharged within sixty days after the making thereof, or such
appointment or taking possession is at any time consented to, requested by, or
acquiesced to by it;

 

(i) Borrower:

 

(i)  has entered against it a
final judgment for the payment of money in excess of $15,000,000 (in each case
not covered by insurance satisfactory to Administrative Agent in its
discretion), unless the same is stayed or discharged within thirty days after
the date of entry thereof (or longer period for which a stay of enforcement is
allowed by applicable Law) or an appeal or appropriate proceeding for review
thereof is taken within such period and a stay of execution pending such appeal
is obtained; or

 

(ii)  suffers a writ or warrant
of attachment or any similar process to be issued by any Tribunal against any
Collateral or all or any substantial part of its assets, and such writ or
warrant of attachment or any similar process is not stayed or released within
sixty days after the entry or levy thereof (or longer period for which a stay
of enforcement is allowed by applicable Law) or after any stay is vacated or
set aside;

 

(j)  Any Change in Control occurs; or

 

(k)  Any “Event of Default” shall occur, as such
term is used and defined in the PAA Credit Agreement.

 

48

 

Upon the occurrence of an Event
of Default described in subsection (h)(i), (h)(ii) or (h)(iii) of this section:
all Obligations shall thereupon be immediately due and payable, without demand,
presentment, notice of demand or of dishonor and nonpayment, protest, notice of
protest, notice of intention to accelerate, declaration or notice of
acceleration, or any other notice or declaration of any kind, all of which are
hereby expressly waived by Borrower. 
Upon any such acceleration, any obligation of any Lender to make any
further Loans and any obligation of LC Issuer to issue Letters of Credit
hereunder shall be permanently terminated. 
During the continuance of any other Event of Default, Administrative
Agent at any time and from time to time may (and upon written instructions from
Majority Lenders, Administrative Agent shall), without notice to Borrower, do
either or both of the following: 
(1) terminate or suspend any obligation of Lenders to make Loans
hereunder and any obligation of LC Issuer to issue Letters of Credit hereunder,
and (2) declare any or all of the Obligations immediately due and payable, and
all such Obligations shall thereupon be immediately due and payable, without
demand, presentment, notice of demand or of dishonor and nonpayment, protest,
notice of protest, notice of intention to accelerate, declaration or notice of
acceleration, or any other notice or declaration of any kind, all of which are
hereby expressly waived by Borrower.

 

Section 8.2.  Remedies.  If any Default shall occur and be continuing, each Lender Party
may protect and enforce its rights under the Loan Documents by any appropriate
proceedings, including proceedings for specific performance of any covenant or
agreement contained in any Loan Document, and each Lender Party may enforce the
payment of any Obligations due it or enforce any other legal or equitable right
which it may have.  All rights, remedies
and powers conferred upon Lender Parties under the Loan Documents shall be
deemed cumulative and not exclusive of any other rights, remedies or powers
available under the Loan Documents or at Law or in equity.

 

ARTICLE IX - Administrative
Agent 

 

Section 9.1.  Appointment and Authority. Each Lender
Party hereby irrevocably authorizes Administrative Agent, and Administrative
Agent hereby undertakes, to receive payments of principal, interest and other
amounts due hereunder as specified herein and to take all other actions and to
exercise such powers under the Loan Documents as are specifically delegated to
Administrative Agent by the terms hereof or thereof, together with all other
powers reasonably incidental thereto. 
The relationship of Administrative Agent to the other Lender Parties is
only that of one commercial lender acting as administrative agent for others,
and nothing in the Loan Documents shall be construed to constitute
Administrative Agent a trustee or other fiduciary for any Lender Party or any
holder of any participation in a Note nor to impose on Administrative Agent
duties and obligations other than those expressly provided for in the Loan
Documents.  With respect to any matters
not expressly provided for in the Loan Documents and any matters which the Loan
Documents place within the discretion of Administrative Agent,  Administrative Agent shall not be required
to exercise any discretion or take any action, and it may request instructions
from Lenders with respect to any such matter, in which case it shall be
required to act or to refrain from acting (and shall be fully protected and
free from liability to all Lender Parties in so acting or refraining from
acting) upon the instructions of Majority Lenders (including itself), provided,
however, that Administrative Agent shall not be required to take any action
which exposes it to a risk of personal liability that it considers unreasonable
or which is

 

49

 

contrary to the Loan Documents or to applicable Law.  Upon receipt by Administrative Agent from
Borrower of any communication calling for action on the part of Lenders or upon
notice from Borrower or any Lender to Administrative Agent of any Default or
Event of Default, Administrative Agent shall promptly notify each other Lender
thereof.

 

Section 9.2.  Exculpation, Administrative Agent’s
Reliance, Etc.  Neither
Administrative Agent nor any of its directors, officers, agents, attorneys, or
employees shall be liable for any action taken or omitted to be taken by any of
them under or in connection with the Loan Documents, including their negligence of any kind,
except that each shall be liable for its own gross negligence or willful
misconduct.  Without limiting the
generality of the foregoing, Administrative Agent (a) may treat the payee of
any Note as the holder thereof until Administrative Agent receives written
notice of the assignment or transfer thereof in accordance with this Agreement,
signed by such payee and in form satisfactory to Administrative Agent; (b) may
consult with legal counsel (including counsel for Borrower), independent public
accountants and other experts selected by it and shall not be liable for any
action taken or omitted to be taken in good faith by it in accordance with the
advice of such counsel, accountants or experts; (c) makes no warranty or
representation to any other Lender Party and shall not be responsible to any
other Lender Party for any statements, warranties or representations made in or
in connection with the Loan Documents; (d) shall not have any duty to ascertain
or to inquire as to the performance or observance of any of the terms,
covenants or conditions of the Loan Documents on the part of Borrower or to
inspect the property (including the books and records) of Borrower; (e) shall
not be responsible to any other Lender Party for the due execution, legality,
validity, enforceability, genuineness, sufficiency or value of any Loan
Document or any instrument or document furnished in connection therewith; (f)
may rely upon the representations and warranties of Borrower or Lender Party in
exercising its powers hereunder; and (g) shall incur no liability under or in
respect of the Loan Documents by acting upon any notice, consent, certificate
or other instrument or writing (including any facsimile, telegram, cable or
telex) believed by it to be genuine and signed or sent by the proper Person or
Persons.

 

Section 9.3.  Credit Decisions.  Each Lender Party acknowledges that it has,
independently and without reliance upon any other Lender Party, made its own analysis
of Borrower and the transactions contemplated hereby and its own independent
decision to enter into this Agreement and the other Loan Documents.  Each Lender Party also acknowledges that it
will, independently and without reliance upon any other Lender Party and based
on such documents and information as it shall deem appropriate at the time,
continue to make its own credit decisions in taking or not taking action under
the Loan Documents.

 

Section
9.4.  Indemnification.  Each
Lender agrees to indemnify Administrative Agent (to the extent not reimbursed
by Borrower within ten (10) days after demand) from and against such Lender’s
Percentage Share of any and all liabilities, obligations, claims, losses,
damages, penalties, fines, actions, judgments, suits, settlements, costs,
expenses or disbursements (including reasonable fees of attorneys, accountants,
experts and advisors) of any kind or nature whatsoever (in this section
collectively called “liabilities and costs”) which to any extent (in whole or
in part) may be imposed on, incurred by, or asserted against Administrative
Agent growing out of, resulting from or in any other way associated with any of
the Collateral, the Loan Documents and the 

 

50

 

transactions and
events (including the enforcement thereof) at any time associated therewith or
contemplated therein and Borrower’s use of loan proceeds (whether arising in
contract or in tort or otherwise and including any violation or noncompliance
with any Environmental Laws by any Person or any liabilities or duties of any
Person with respect to Hazardous Materials found in or released into the
environment).

 

The foregoing indemnification shall apply
whether or not such liabilities and costs are in any way or to any extent owed,
in whole or in part, under any claim or theory of strict liability or caused,
in whole or in part, by any negligent act or omission of any kind by
Administrative Agent, provided only that no Lender
shall be obligated under this section to indemnify Administrative Agent for
that portion, if any, of any liabilities and costs which is proximately caused
by Administrative Agent’s own individual gross negligence or willful
misconduct, as determined in a final judgment. 
Cumulative of the foregoing, each Lender agrees to reimburse
Administrative Agent promptly upon demand for such Lender’s Percentage Share of
any costs and expenses to be paid to Administrative Agent by Borrower under
Section 10.4(a) to the extent that Administrative Agent is not timely
reimbursed for such expenses by Borrower as provided in such section.  As used in this section the term
“Administrative Agent” shall refer not only to the Persons designated as such
in Section 1.1 but also to each director, officer, agent, attorney,
employee, representative and Affiliate of such Person.

 

Section 9.5.  Rights as Lender.  In its capacity as a Lender, Administrative
Agent shall have the same rights and obligations as any Lender and may exercise
such rights as though it were not Administrative Agent.  Administrative Agent may accept deposits
from, lend money to, act as trustee under indentures of, and generally engage
in any kind of business with Borrower or its Affiliates, all as if it were not
Administrative Agent hereunder and without any duty to account therefor to any
other Lender.

 

Section 9.6.  Sharing of Set-Offs and Other Payments.  Each Lender Party agrees that if it shall,
whether through the exercise of rights of banker’s lien, set off, or
counterclaim against Borrower or otherwise, obtain payment of a portion of the
aggregate Obligations owed to it which, taking into account all distributions
made by Administrative Agent under Section 3.1, causes such Lender Party to
have received more than it would have received had such payment been received
by Administrative Agent and distributed pursuant to Section 3.1, then (a) it
shall be deemed to have simultaneously purchased and shall be obligated to
purchase interests in the Obligations as necessary to cause all Lender Parties to
share all payments as provided for in Section 3.1, and (b) such other
adjustments shall be made from time to time as shall be equitable to ensure
that Administrative Agent and all Lender Parties share all payments of
Obligations as provided in Section 3.1; provided, however, that nothing herein
contained shall in any way affect the right of any Lender Party to obtain
payment (whether by exercise of rights of banker’s lien, set-off or
counterclaim or otherwise) of indebtedness other than the Obligations.  Borrower expressly consents to the foregoing
arrangements, subject to Section 10.9. 
If all or any part of any funds transferred pursuant to this section is
thereafter recovered from the seller under this section which received the
same, the purchase provided for in this section shall be deemed to have been
rescinded to the extent of such recovery, together with interest, if any, if
interest is 

 

51

 

required pursuant to the order of a Tribunal to be paid on account of
the possession of such funds prior to such recovery.

 

Section 9.7.  Investments.  Whenever Administrative Agent in good faith
determines that it is uncertain about how to distribute to Lender Parties any
funds which it has received, or whenever Administrative Agent in good faith
determines that there is any dispute among Lender Parties about how such funds
should be distributed, Administrative Agent may choose to defer distribution of
the funds which are the subject of such uncertainty or dispute.  If Administrative Agent in good faith
believes that the uncertainty or dispute will not be promptly resolved, or if
Administrative Agent is otherwise required to invest funds pending distribution
to Lender Parties, Administrative Agent shall invest such funds pending
distribution; all interest on any such Investment shall be distributed upon the
distribution of such Investment and in the same proportion and to the same
Persons as such Investment.  All moneys
received by Administrative Agent for distribution to Lender Parties (other than
to the Person who is Administrative Agent in its separate capacity as a Lender
Party) shall be held by Administrative Agent pending such distribution solely
as Administrative Agent for such Lender Parties, and Administrative Agent shall
have no equitable title to any portion thereof.

 

Section 9.8.  Benefit of Article IX.  The provisions of this Article are intended
solely for the benefit of Lender Parties, and Borrower shall not be entitled to
rely on any such provision or assert any such provision in a claim or defense
against any Lender (other than contained in Section 9.6 or the right to
reasonably approve a successor Administrative Agent under Section 9.9).  Lender Parties may waive or amend such
provisions as they desire without any notice to or consent of Borrower.

 

Section 9.9.  Resignation.  Administrative Agent may resign at any time
by giving written notice thereof to Lenders and Borrower.  Each such notice shall set forth the date of
such resignation.  Upon any such
resignation Majority Lenders shall have the right to appoint a successor
Administrative Agent, subject to the approval of Borrower, unless a Default has
occurred and is continuing, which approval will not be unreasonably withheld.  A successor must be appointed for any
retiring Administrative Agent, and such Administrative Agent’s resignation
shall become effective when such successor accepts such appointment.  If, within thirty days after the date of the
retiring Administrative Agent’s resignation, no successor Administrative Agent
has been appointed and has accepted such appointment, then the retiring
Administrative Agent may appoint a successor Administrative Agent, which shall
be a commercial bank organized or licensed to conduct a banking or trust business
under the Laws of the United States of America or of any state thereof.  Upon the acceptance of any appointment as
Administrative Agent hereunder by a successor Administrative Agent, the
retiring Administrative Agent shall be discharged from its duties and
obligations under this Agreement and the other Loan Documents.  After any retiring Administrative Agent’s
resignation hereunder the provisions of this Article IX shall continue to inure
to its benefit as to any actions taken or omitted to be taken by it while it
was Administrative Agent under the Loan Documents.

 

52

 

ARTICLE X
- Miscellaneous

 

Section 10.1.  Waivers and Amendments; Acknowledgments.

 

(a)  Waivers and Amendments.  No failure or delay (whether by course of

conduct or otherwise) by any
Lender in exercising any right, power or remedy which such Lender Party may
have under any of the Loan Documents shall operate as a waiver thereof or of
any other right, power or remedy, nor shall any single or partial exercise by
any Lender Party of any such right, power or remedy preclude any other or
further exercise thereof or of any other right, power or remedy.  No waiver of any provision of any Loan
Document and no consent to any departure therefrom shall ever be effective
unless it is in writing and signed as provided below in this section, and then
such waiver or consent shall be effective only in the specific instances and
for the purposes for which given and to the extent specified in such writing.  This Agreement and the other Loan Documents
set forth the entire understanding between the parties hereto with respect to
the transactions contemplated herein and therein and supersede all prior
discussions and understandings with respect to the subject matter hereof and
thereof, and no waiver, consent, release, modification or amendment of or
supplement to this Agreement or the other Loan Documents shall be valid or
effective against any party hereto unless the same is in writing and signed by
(i) if such party is Borrower, by Borrower, (ii) if such party is
Administrative Agent or LC Issuer, by such party, and (iii) if such party is a
Lender, by such Lender or by Administrative Agent on behalf of Lenders with the
written consent of Majority Lenders (which consent has already been given as to
the termination of the Loan Documents as provided in Section 10.9).  Notwithstanding the foregoing or anything to
the contrary herein, Administrative Agent shall not, without the prior consent
of each individual Lender, execute and deliver on behalf of such Lender any
waiver or amendment which would:  (1)
waive any of the conditions specified in Article IV (provided that
Administrative Agent may in its discretion withdraw any request it has made
under Section 4.1(h)), (2) increase the maximum amount which such Lender
has specified hereunder regarding consideration of financing requests, or
extend the termination date of such Lender’s agreement to consider financing
requests, (3) reduce any fees payable to such Lender hereunder, or the
principal of, or interest on, such Lender’s Note, (4) change any date
fixed for any payment of any such fees, principal or interest, or change
Section 9.6 in a manner that would alter pro rata sharing of payments required
thereby, (5) amend the definition herein of “Majority Lenders” or otherwise
change the Percentage Shares which are required for Administrative Agent,
Lenders or any of them to take any particular action under the Loan Documents,
or (6) except as expressly provided herein or in any other Loan Document,
release (i) Borrower from its obligation to pay such Lender’s Note, (ii) any
Collateral, or (iii) Borrower from the negative pledge covenant set forth in
Section 7.5 hereof.

 

(b)  Acknowledgments and Admissions.  Borrower hereby represents, warrants,
acknowledges and admits that  (i) it has
been advised by counsel in the negotiation, execution and delivery of the Loan
Documents to which it is a party, (ii) no Lender Party has any fiduciary
obligation toward Borrower with respect to any Loan Document or the
transactions contemplated thereby, (iii) the relationship pursuant to the Loan
Documents between Borrower, on one hand, and each Lender Party, on the other
hand, is and shall be solely that of debtor and creditor, respectively, and (iv)
no partnership or joint venture exists with respect to the Loan Documents
between Borrower and any Lender Party.

 

53

 

(c)  Representation by Lenders.  Each Lender hereby represents that it will
acquire its Notes for its own account in the ordinary course of its commercial
lending or investing business; however, the disposition of such Lender’s
property shall at all times be and remain within its control and, in particular
and without limitation, such Lender may sell or otherwise transfer its Note,
any participation interest or other interest in its Note, or any of its other
rights and obligations under the Loan Documents subject to compliance with
Sections 10.5(b) through (f), inclusive, and applicable Law.

 

(d)  Joint
Acknowledgment.  This written Agreement and the other Loan
Documents represent the final agreement between the parties and may not be
contradicted by evidence of prior, contemporaneous, or subsequent oral
agreements of the parties.

 

There are no
unwritten oral agreements between the parties.

 

Section 10.2.  Survival of Agreements; Cumulative Nature.  Borrower’s various representations,
warranties, covenants and agreements in the Loan Documents shall survive the
execution and delivery of this Agreement and the other Loan Documents and the
performance hereof and thereof, including the making or granting of the Loans
and the delivery of the Notes and the other Loan Documents, and shall further
survive until all of the Obligations are paid in full to each Lender Party and
all of Lender Parties’ obligations to Borrower are terminated.  The rights, powers, and privileges granted
to Lender Parties in the Loan Documents, are cumulative, and, except for expressly
specified waivers and consents, no Loan Document shall be construed in the
context of another to diminish, nullify, or otherwise reduce the benefit to any
Lender Party of any such right, power or privilege.

 

Section 10.3.  Notices.  All notices, requests, consents, demands and other communications
required or permitted under any Loan Document shall be in writing, unless
otherwise specifically provided in such Loan Document (provided that
Administrative Agent may give telephonic notices to the other Lender Parties),
and shall be deemed sufficiently given or furnished if delivered by personal
delivery, by facsimile or other electronic transmission, by delivery service
with proof of delivery, or by registered or certified United States mail,
postage prepaid, to Borrower at the address of Borrower specified on the
signature pages hereto and to each Lender Party at its address specified on the
signature pages hereto (unless changed by similar notice in writing given by
the particular Person whose address is to be changed).  Any such notice or communication shall be
deemed to have been given (a) in the case of personal delivery or delivery
service, as of the date of first attempted delivery during normal business
hours at the address provided herein, (b) in the case of facsimile or other
electronic transmission, upon receipt, or (c) in the case of registered or
certified United States mail, three days after deposit in the mail; provided,
however, that no Borrowing Notice or Continuation/Conversion Notice shall
become effective until actually received by Administrative Agent.

 

54

 

Section 10.4.  Payment of Expenses; Indemnity.

 

(a)  Payment of Expenses.  Whether or not the transactions contemplated
by this Agreement are consummated, Borrower will promptly (and in any event,
within 30 days after any invoice or other statement or notice) pay: (i) all
transfer, stamp, mortgage, documentary or other similar taxes, assessments or
charges levied by any governmental or revenue authority in respect of this
Agreement or any of the other Loan Documents or any other document referred to
herein or therein, (ii) all reasonable costs and expenses incurred by or on
behalf of Administrative Agent (including attorneys’ fees, consultants’ fees
and engineering fees, travel costs and miscellaneous expenses) in connection
with (1) the negotiation, preparation, execution and delivery of the Loan
Documents, and any and all consents, waivers or other documents or instruments
relating thereto, (2) the filing, recording, refiling and re-recording of any
Loan Documents and any other documents or instruments or further assurances
required to be filed or recorded or refiled or re-recorded by the terms of any
Loan Document, (3) the borrowings hereunder and other action reasonably
required in the course of administration hereof, (4) monitoring or confirming
(or preparation or negotiation of any document related to) Borrower’s
compliance with any covenants or conditions contained in this Agreement or in
any Loan Document, and (iii) all reasonable costs and expenses incurred by or
on behalf of any Lender Party (including attorneys’ fees, consultants’ fees and
accounting fees) in connection with the defense or enforcement of any of the
Loan Documents (including this section) or the defense of any Lender Party’s
exercise of its rights thereunder.  In
addition to the foregoing, until all Obligations have been paid in full,
Borrower will also pay or reimburse Administrative Agent for all reasonable
out-of-pocket costs and expenses of Administrative Agent or its agents or
employees in connection with the continuing administration of the Loans and the
related due diligence of Administrative Agent, including travel and
miscellaneous expenses and fees and expenses of Administrative Agent’s outside
counsel and consultants engaged in connection with the Loan Documents.

 

(b)  Indemnity.  Borrower agrees to indemnify each Lender Party, upon demand, from
and against any and all liabilities, obligations, claims, losses, damages,
penalties, fines, actions, judgments, suits, settlements, costs, expenses or
disbursements (including reasonable fees of attorneys, accountants, experts and
advisors) of any kind or nature whatsoever (in this section collectively called
“liabilities and costs”) which to any extent (in whole or in part) may be
imposed on, incurred by, or asserted against such Lender Party growing out of,
resulting from or in any other way associated with any of the Collateral, the
Loan Documents and the transactions and events (including the enforcement or
defense thereof) at any time associated therewith or contemplated therein and
Borrower’s use of Loan proceeds (whether arising in contract or in tort or
otherwise and including any violation or noncompliance with any Environmental
Laws by any Lender Party or any other Person or any liabilities or duties of
any Lender Party or any other Person with respect to Hazardous Materials found
in or released into the environment).

 

The foregoing indemnification shall apply
whether or not such liabilities and costs are in any way or to any extent owed,
in whole or in part, under any claim or theory of strict liability or caused,
in whole or in part, by any negligent act or omission of any kind by any Lender
Party, provided only that no Lender Party shall be
entitled under this section to receive indemnification for that portion, if
any, of any liabilities and costs which is proximately caused by its own
individual gross negligence or willful misconduct, as determined in a final
judgment.  If any Person (including
Borrower or any of its Affiliates) ever alleges such gross negligence or
willful misconduct by any Lender Party, the

 

55

 

indemnification provided for in
this section shall nonetheless be paid upon demand, subject to later adjustment
or reimbursement, until such time as a court of competent jurisdiction enters a
final judgment as to the extent and effect of the alleged gross negligence or
willful misconduct.  As used in this
section the term “Lender Party” shall refer not only to each Person designated
as such in Section 1.1 but also to each director, officer, trustee, agent,
attorney, employee, representative and Affiliate of such Persons.

 

(c)  Interest.  Borrower hereby promises to each Lender Party interest at the
Default Rate on all Obligations to pay fees or to reimburse or indemnify any
Lender Party which Borrower has promised to pay to such Lender Party pursuant
to this Section 10.4 and which are not paid when due.  Such interest shall accrue from the date such Obligations become
due until they are paid.

 

Section 10.5.  Parties in Interest; Assignments;
Replacement Notes.

 

(a)  All grants, covenants and agreements
contained in the Loan Documents shall bind and inure to the benefit of the
parties thereto and their respective successors and permitted assigns;
provided, however, that Borrower may not assign or transfer any of its rights
or delegate any of its duties or obligations under any Loan Document without
the prior consent of all Lenders. 
Neither Borrower nor any Affiliates of Borrower shall directly or
indirectly purchase or otherwise retire any Obligations owed to any Lender nor
will any Lender accept any offer to do so, unless each Lender shall have
received substantially the same offer with respect to the same Percentage Share
of the Obligations owed to it.  If
Borrower or any Affiliate of Borrower at any time purchases some but less than
all of the Obligations owed to all Lender Parties, such purchaser shall not be
entitled to any rights of any Lender under the Loan Documents unless and until
Borrower or its Affiliates have purchased all of the Obligations.

 

(b)  No Lender shall sell any participation
interest in its commitment hereunder or any of its rights under its Loans or
under the Loan Documents to any Person unless the agreement between such Lender
and such participant at all times provides: (i) that such participation exists
only as a result of the agreement between such participant and such Lender and
that such transfer does not give such participant any right to vote as a Lender
or any other direct claims or rights against any Person other than such Lender,
(ii) that such participant is not entitled to payment from Borrower under
Sections 3.2 through 3.6 of amounts in excess of those payable to such Lender
under such sections (determined without regard to the sale of such
participation), and (iii) unless such participant is an Affiliate of such
Lender, that such participant shall not be entitled to require such Lender to
take any action under any Loan Document or to obtain the consent of such
participant prior to taking any action under any Loan Document, except for
actions which would require the consent of all Lenders under subsection (a) of
Section 10.1.  No Lender selling such a
participation shall, as between the other parties hereto and such Lender, be
relieved of any of its obligations hereunder as a result of the sale of such
participation.  Each Lender which sells
any such participation to any Person (other than an Affiliate of such Lender)
shall give prompt notice thereof to Administrative Agent and Borrower;
provided, however, that no liability shall arise if any such Lender fails to
give such notice to Borrower.

 

(c)  Except for sales of participations under the
immediately preceding subsection, no Lender shall make any assignment or
transfer of any kind of its commitments or any of its rights 

 

56

 

under its Loans or under the Loan Documents, except for assignments to
an Eligible Transferee or, subject to the provisions of subsection (g) below,
to an affiliate, and then only if such assignment is made in accordance with
the following requirements:

 

(i)  In the case of an
assignment by a Lender of less than all of its Loans, LC Obligations and any
commitment hereunder, each such assignment shall apply to a consistent
percentage of all Loans and LC Obligations owing to the assignor Lender
hereunder and to the same percentage of the unused portion of the assignor
Lender’s Percentage Share of the Maximum Loan Amount, so that after such
assignment is made both the assignee Lender and the assignor Lender shall have
a fixed (and not a varying) Percentage Share in its Loans and LC Obligations
and be committed to make that Percentage Share of all future Loans and make
that Percentage Share of all future participations in LC Obligations, and the
Percentage Share of the Maximum Facility Amount of each of the assignor and
assignee shall equal or exceed $5,000,000.

 

(ii)  The parties to each such
assignment shall execute and deliver to Administrative Agent, for its
acceptance and recording in the “Register” (as defined below in this section),
an Assignment and Acceptance in the form of Exhibit G, appropriately completed,
together with the Note subject to such assignment and a processing fee payable
by such assignor Lender (and not at Borrower’s expense) to Administrative Agent
of $3,500.  Upon such execution,
delivery, and payment and upon the satisfaction of the conditions set out in
such Assignment and Acceptance, then (i) Borrower shall issue new Notes to
such assignor and assignee upon return of the old Notes to Borrower, and (ii)
as of the “Settlement Date” specified in such Assignment and Acceptance the
assignee thereunder shall be a party hereto and a Lender hereunder and
Administrative Agent shall thereupon deliver to Borrower and each Lender a
revised Schedule 1 hereto showing the revised Percentage Shares and total
Percentage Shares of such assignor Lender and such assignee Lender and the
revised Percentage Shares and total Percentage Shares of all other Lenders.

 

(iii)  Each assignee Lender
which is not a United States person (as such term is defined in Section
7701(a)(30) of the Code) for Federal income tax purposes, shall (to the extent
it has not already done so) provide Administrative Agent and Borrower with the
“Prescribed Forms” referred to in Section 3.7(d).

 

(d)  Any Lender may at any time pledge all or any
portion of its Loan and Note (and related rights under the Loan Documents
including any portion of its Note) to any of the twelve (12) Federal Reserve
Banks organized under Section 4 of the Federal Reserve Act, 12 U.S.C. Section
341.  No such pledge or enforcement
thereof shall release any such Lender from its obligations under any of the Loan
Documents; provided that all related costs, fees and expenses in connection
with any such pledge shall be for the sole account of such Lender.

 

(e)  By executing and delivering an Assignment
and Acceptance, each assignee Lender thereunder will be confirming to and
agreeing with Borrower, Administrative Agent and each other Lender Party that
such assignee understands and agrees to the terms hereof, including Article IX
hereof.

 

57

 

(f)  Administrative Agent shall maintain a copy
of each Assignment and Acceptance and a register for the recordation of the
names and addresses of Lenders and the Percentage Shares of, and principal
amount of the Loans owing to, each Lender from time to time (in this section
called the “Register”).  The entries in
the Register shall be conclusive, in the absence of manifest error, and
Borrower and each Lender Party may treat each Person whose name is recorded in
the Register as a Lender Party hereunder for all purposes.  The Register shall be available for
inspection by Borrower or any Lender Party at any reasonable time and from time
to time upon reasonable prior notice.

 

(g)  Any Lender may assign or transfer its
commitment or its rights under its Loans or under the Loan Documents to
(i) any Affiliate that is wholly-owned direct or indirect subsidiary of
such Lender or of any Person that wholly owns, directly or indirectly, such
Lender, or (ii) if such Lender is a fund that makes or invests in bank
loans, any other fund that makes or invests in bank loans and is advised or
managed by (A) the same investment advisor as any Lender or (B) any
Affiliate of such investment advisor that is a wholly-owned direct or indirect
subsidiary of any Person that wholly owns, directly or indirectly, such
investment advisor, subject to the following additional conditions (x), (y) and
(z), with respect to assignments pursuant to clause (i) above, and subject to
the following additional conditions (y) and (z) with respect to assignments
pursuant to clause (ii) above:

 

(x)  any right of such Lender
assignor and such assignee to vote as a Lender, or any other direct claims or
rights against any other Persons, shall be uniformly exercised by both such
assignor and assignee or pursued in the manner that such Lender assignor would
have so exercised such vote, claim or right if it had not made such assignment
or transfer; and

 

(y)  such assignee shall not be
entitled to payment from Borrower under Sections 3.2 through 3.7 of
amounts in excess of those payable to such Lender assignor under such sections
(determined without regard to such assignment or transfer); and

 

(z)  if such Lender assignor is
a Lender that assigns or transfers to such assignee any of such Lender’s
Percentage Share of any commitment hereunder, assignee may become primarily
liable for such commitment, but such assignment or transfer shall not relieve
or release such Lender from such commitment.

 

(h)  Upon receipt of an affidavit reasonably
satisfactory to Borrower of an officer of any Lender as to the loss, theft,
destruction or mutilation of its Note which is not of public record, and, in
the case of any such loss, theft, destruction or mutilation, upon cancellation
of such Note, Borrower will execute and deliver, in lieu thereof, a replacement
Note in the same principal amount thereof and otherwise of like tenor.

 

Section 10.6.  Confidentiality.  Each Lender Party agrees (on behalf of
itself and each of its Affiliates, and each of its and their directors,
officers, agents, attorneys, employees, and representatives) that it (and each
of them) will take all reasonable steps to keep confidential any non-public
information supplied to it by or at the direction of Borrower so identified
when 

 

58

 

delivered, provided, however, that this restriction shall not apply to
(a) information which has at the time in question entered the public domain,
other than as a result of a breach of this Section 10.6, (b) information which
is required to be disclosed by Law (whether valid or invalid) of any Tribunal,
(c) any disclosure to any Lender Party’s Affiliates, auditors, attorneys or
agents (provided each such Person first agrees to hold such information in
confidence on the terms provided in this Section 10.6), (d) any disclosure to
any other Lender Party or to any purchaser or prospective purchaser of
participations or other interests in any Loan or Loan Document (provided each
such Person first agrees to hold such information in confidence on the terms
provided in this section), or (e) any disclosure in the course of enforcing its
rights and remedies during the existence of an Event of Default.  Notwithstanding anything herein to the
contrary, confidential information shall not include, and each Lender Party and
Borrower may disclose and may permit to be disclosed to any and all Persons,
without limitation of any kind, the “tax treatment” and “tax structure” (in
each case, within the meaning of Treasury Regulation Section 1.6011-4) of
the transactions contemplated hereby and all materials of any kind (including
opinions or other tax analyses) that are or have been provided to such Lender
Party or Borrower relating to such tax treatment and tax structure.

 

Section 10.7.  Governing Law; Submission to Process.  Except to the extent that the Law of another jurisdiction is
expressly elected in a Loan Document, the Loan Documents shall be deemed
contracts and instruments made under the Laws of the State of New York and
shall be construed and enforced in accordance with and governed by the Laws of
the State of New York and the Laws of the United States of America, without
regard to principles of conflicts of law. 
Borrower hereby agrees that any legal action or proceeding against Borrower
with respect to this Agreement, the Notes or any of the Loan Documents may be
brought in the courts of the State of New York or of the United States of
America for the Southern District of New York as Lender Parties may elect, and,
by execution and delivery hereof, Borrower accepts and consents for itself and
in respect to its property, generally and unconditionally, the non-exclusive
jurisdiction of the aforesaid courts. 
Each Borrower agrees that Sections 5-1401 and 5-1402 of the General
Obligations Law of the State of New York shall apply to the Loan Documents and
waives any right to stay or to dismiss any action or proceeding brought before
said courts on the basis of forum non conveniens.  In furtherance of the foregoing, Borrower hereby irrevocably
designates and appoints Corporation Service Company, 80 State Street, Albany,
New York 12207, as agent of Borrower to receive service of all process brought
against Borrower with respect to any such proceeding in any such court in New
York, such service being hereby acknowledged by Borrower to be effective and
binding service in every respect. 
Copies of any such process so served shall also, if permitted by Law, be
sent by registered mail to Borrower at its address set forth below, but the
failure of Borrower to receive such copies shall not affect in any way the
service of such process as aforesaid. 
Borrower shall furnish to Lender Parties a consent of Corporation
Service Company agreeing to act hereunder prior to the effective date of this
agreement.  Nothing herein shall affect
the right of Lender Parties to serve process in any other manner permitted by
Law or shall limit the right of Lender Parties to bring proceedings

 

59

 

against Borrower in
the courts of any other jurisdiction. 
If for any reason Corporation Service Company shall resign or otherwise
cease to act as Borrower’s agent, Borrower hereby irrevocably agrees to (a)
immediately designate and appoint a new agent acceptable to Administrative
Agent to serve in such capacity and, in such event, such new agent shall be
deemed to be substituted for Corporation Service Company for all purposes
hereof and (b) promptly deliver to Administrative Agent the written consent (in
form and substance satisfactory to Administrative Agent) of such new agent
agreeing to serve in such capacity.

 

Section 10.8.  Limitation on Interest.  Lender Parties, Borrower and any other
parties to the Loan Documents intend to contract in strict compliance with
applicable usury Law from time to time in effect.  In furtherance thereof such Persons stipulate and agree that none
of the terms and provisions contained in the Loan Documents shall ever be
construed to create a contract to pay, for the use, forbearance or detention of
money, interest in excess of the maximum amount of interest permitted to be
contracted for, charged, or received by applicable Law from time to time in
effect.  Neither Borrower nor any
present or future guarantors, endorsers, or other Persons hereafter becoming
liable for payment of any Obligation shall ever be liable for unearned interest
thereon or shall ever be required to pay interest thereon in excess of the
maximum amount that may be lawfully contracted for, charged, or received under
applicable Law from time to time in effect, and the provisions of this section
shall control over all other provisions of the Loan Documents which may be in
conflict or apparent conflict herewith. 
Lender Parties expressly disavow any intention to contract for, charge,
or receive excessive unearned interest or finance charges in the event the
maturity of any Obligation is accelerated. 
If (a) the maturity of any Obligation is accelerated for any
reason, (b) any Obligation is prepaid and as a result any amounts held to
constitute interest are determined to be in excess of the legal maximum, or (c) any
Lender or any other holder of any or all of the Obligations shall otherwise
collect moneys which are determined to constitute interest which would
otherwise increase the interest on any or all of the Obligations to an amount
in excess of that permitted to be contracted for, charged or received by
applicable Law then in effect, then all sums determined to constitute interest
in excess of such legal limit shall, without penalty, be promptly applied to
reduce the then outstanding principal of the related Obligations or, at such
Lender’s or holder’s option, promptly returned to Borrower or other payor
thereof upon such determination.  In
determining whether or not the interest paid or payable, under any specific
circumstance, exceeds the maximum amount permitted under applicable Law, Lender
Parties and Borrower (and any other payors thereof) shall to the greatest
extent permitted under applicable Law, (i) characterize any non-principal
payment as an expense, fee or premium rather than as interest, (ii) exclude
voluntary prepayments and the effects thereof, and (iii) amortize,
prorate, allocate, and spread the total amount of interest throughout the
entire contemplated term of the instruments evidencing the Obligations in
accordance with the amounts outstanding from time to time thereunder and the
maximum legal rate of interest from time to time in effect under applicable Law
in order to lawfully charge the maximum amount of interest permitted under
applicable Law.  In the event applicable
Law provides for an interest ceiling under Chapter 303 of the Texas Finance
Code (the “Texas Finance Code”) as amended, to the extent that the Texas
Finance Code is mandatorily applicable to any Lender, for that day, the ceiling
shall be the “weekly ceiling” as defined in the Texas Finance Code, provided
that if any applicable Law permits greater interest, the Law

 

60

 

permitting the greatest interest shall apply.  In no event shall Chapter 346 of the Texas Finance Code apply to
this Agreement or any other Loan Document, or any transactions or loan
arrangement provided or contemplated hereby or thereby.

 

Section 10.9.  Right of Offset.  At any time and from time to time during the
continuance of any Event of Default, each Lender is hereby authorized to offset
against the Obligations then due and payable (without notice to Borrower), (a)
any and all moneys, securities or other property (and the proceeds therefrom)
of Borrower now or hereafter held or received by or in transit to any Lender
from or for the account of Borrower, whether for safekeeping, custody, pledge,
transmission, collection or otherwise, (b) any and all deposits (general or
special, time or demand, provisional or final) of Borrower with any Lender, and
(c) any other credits and claims of Borrower at any time existing against any
Lender, including claims under certificates of deposit.

 

Section 10.10.  Termination; Limited Survival.  In its sole and absolute discretion Borrower
may at any time that no Obligations are owing or outstanding elect in a written
notice delivered to Administrative Agent to terminate this Agreement.  Upon receipt by Administrative Agent of such
a notice, if no Obligations are then owing or outstanding this Agreement and
all other Loan Documents shall thereupon be terminated and the parties thereto
released from all prospective obligations thereunder.  Notwithstanding the foregoing or anything herein to the contrary,
any waivers or admissions made by Borrower in any Loan Document, any
Obligations under Sections 3.2 through 3.6, and any obligations which any
Person may have to indemnify or compensate any Lender Party shall survive any
termination of this Agreement or any other Loan Document.  At the request and expense of Borrower,
Administrative Agent shall prepare and execute all necessary instruments to
reflect and effect such termination of the Loan Documents.  Administrative Agent is hereby authorized to
execute all such instruments on behalf of all Lenders, without the joinder of
or further action by any Lender.

 

Section 10.11.  Severability.  If any term or provision of any Loan
Document shall be determined to be illegal or unenforceable all other terms and
provisions of the Loan Documents shall nevertheless remain effective and shall
be enforced to the fullest extent permitted by applicable Law.

 

Section 10.12.  Counterparts.  This Agreement may be separately executed in
any number of counterparts and by different parties hereto in separate
counterparts, each of which when so executed shall be deemed to constitute one
and the same Agreement.

 

Section 10.13.  Waiver of Jury Trial, Punitive Damages,
etc.  Borrower and Lender Parties mutually hereby
knowingly, voluntarily, and intentionally waive the right to a trial by jury in
respect of any claim based hereon, arising out of, under or in connection with,
this Agreement or any other Loan Documents contemplated to be executed in
connection herewith or any course of conduct, course of dealings, statements
(whether verbal or written) or actions of any party.  This waiver constitutes a material inducement for Lenders to
enter into this Agreement and the other Loan Documents and make the Loans.  Borrower and each Lender Party hereby
further (a) irrevocably waives, to the maximum 

 

61

 

extent not prohibited
by Law, any right it may have to claim or recover in any such litigation any
“Special Damages,” as defined below, (b) certifies that no party hereto nor any
representative or agent or counsel for any party hereto has represented,
expressly or otherwise, or implied that such party would not, in the event of
litigation, seek to enforce the foregoing waivers, and (c) acknowledges that it
has been induced to enter into this Agreement, the other Loan Documents and the
transactions contemplated hereby and thereby by, among other things, the mutual
waivers and certifications contained in this section.  As used in this section, “Special Damages” includes all special,
consequential, exemplary, or punitive damages (regardless of how named), but
does not include any payments or funds which any party hereto has expressly
promised to pay or deliver to any other party hereto.

 

Section 10.14.  Replacement Credit Facility.  Borrower states and acknowledges that this
Agreement is entered into by it in replacement of that certain Second Amended
and Restated Credit Agreement [Letter of Credit and Hedged Inventory Facility]
dated July 2, 2002 (the “Expiring LC Facility”), among Borrower, Fleet
National Bank as administrative agent and the lenders party thereto.  Borrower further states, acknowledges and
agrees that the preceding sentence does not and shall not alter or otherwise
modify in any regard, directly or indirectly, expressly or impliedly or
otherwise, (i) any termination of the Expiring LC Facility or, among other
things, the termination of the Liens created to secure the Expiring LC Facility
or (ii) the terms, provisions and conditions expressly set forth in, and
contemplated by, this Agreement, or the transactions contemplated hereby, which
in each case shall be governed solely by the terms, provisions and conditions
of this Agreement and the other Loan Documents without regard to this Section
10.14; and for the avoidance of any doubt, such preceding sentence does not and
shall not alter or modify in any regard, directly or indirectly, expressly or
impliedly or otherwise, the discretionary and un-committed nature of the credit
facility referred to herein.

 

[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK.]

 

62

 

IN WITNESS
WHEREOF, this Agreement is executed as of the date first written above.

 

	
  Borrower:

  	
  PLAINS
  MARKETING, L.P.

  
	
   

  	
   

  
	
   

  	
  By:

  	
  PLAINS
  MARKETING GP INC.,

  
	
   

  	
   

  	
  its general
  partner

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
  Al Swanson,
  Treasurer

  
	
   

  	
   

  
	
  Address for
  Borrower:

  	
  333 Clay
  Street, Suite 1600

  
	
   

  	
  Houston,
  Texas 77002

  
	
   

  	
  Attention:
  Al Swanson

  
	
   

  	
  Telephone:
  (713) 646-4455

  
	
   

  	
  Fax: (713)
  646-4564

  
	
   

  	
   

  
	
   

  	
  PAA Website:
  www.paalp.com

  

 

63

 

	
   

  	
  FLEET
  NATIONAL BANK,

  
	
   

  	
  Administrative
  Agent, LC Issuer and a Lender

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
  Terrence
  Ronan, Managing Director

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  FLEET
  SECURITIES, INC.,

  
	
   

  	
  Lead
  Arranger and Book Manager

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
  Michael P.
  Hannon, Managing Director

  

 

64

 

	
   

  	
  BNP PARIBAS,
  a Lender

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  
					

 

65

 

	
   

  	
  SOCIETE
  GENERALE, a Lender

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By

  	
   

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  
					

 

66

 

SCHEDULE 1

 

LENDER SCHEDULE

 

	
  Lender

  	
   

  	
  Percentage
  Share of Maximum Facility Amount

  	
   

  	
  Percentage
  Share(1)

  	
   

  
	
  Fleet National Bank

  	
   

  	
  $

  	
  100,000,000.00

  	
   

  	
  50.000000

  	
  %

  
	
  BNP Paribas

  	
   

  	
  $

  	
  75,000,000.00

  	
   

  	
  37.500000

  	
  %

  
	
  Societe Generale

  	
   

  	
  $

  	
  25,000,000.00

  	
   

  	
  12.500000

  	
  %

  
	
  TOTALS

  	
   

  	
  $

  	
  200,000,000.00

  	
   

  	
  100.000000

  	
  %

  

 

(1) Rounded to six decimal
places

 

 

LENDER INFORMATION

 

	
  Lender

  	
   

  	
  Contact

  	
   

  	
  Domestic
  Lending Office

  	
   

  	
  LIBOR
  Lending Office

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Fleet National Bank

  	
   

  	
  100 Federal Street

  Energy & Utilities

  MADE 10009H vice MADE 10008D

  Boston, Massachusetts  02110

  Attn: Terrence Ronan

  Phone: 617-434-5472

  Fax:  617-434-3652

  	
   

  	
  100 Federal Street

  Boston, Massachusetts  02110

  	
   

  	
  100 Federal Street

  Boston, Massachusetts  02110

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  BNP Paribas

  	
   

  	
  787 7th Avenue

  New York, New York 10019

  Attn: Ed Chin

  Phone: 212-841-2020

  Fax:  212-841-2536

  	
   

  	
  787 7th Avenue

  New York, New York 10019

  	
   

  	
  787 7th Avenue

  New York, New York 10019

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Societe Generale

  	
   

  	
  1221 Avenue of the
  Americas

  New York, New York 10020

  Attn: Jordan Nenoff

  Phone: 212-278-7407

  Fax: 212-278-7417

  	
   

  	
  1221 Avenue of the
  Americas

  New York, New York 10020

  	
   

  	
  1221 Avenue of the
  Americas

  New York, New York 10020

  

 

 

SCHEDULE 3

 

SECURITY SCHEDULE

 

1.                                       Security
Agreement of even date herewith by Borrower in favor of Administrative Agent,
for the benefit of Lenders, covering Hedged Eligible Inventory, Hedging
Contracts, Petroleum Product sales contracts and Accounts therefrom and
proceeds thereof as from time to time specified by Borrower (the “Security Agreement”).

 

2.                                       UCC-1
Financing Statement naming Borrower as debtor and Administrative Agent as
secured party, covering the Collateral described in the Security Agreement.

 

 

SCHEDULE 4

 

PRICING GRID

 

	
  Applicable

  Rating Level

  	
   

  	
  Applicable Margin

  Base Rate Loans

  	
   

  	
  Applicable Margin

  LIBOR Loans

  and LC Fee Rate

  	
   

  
	
  Level I

  	
   

  	
  0.000

  	
  %

  	
  0.375

  	
  %

  
	
  Level II

  	
   

  	
  0.000

  	
  %

  	
  0.500

  	
  %

  
	
  Level III

  	
   

  	
  0.000

  	
  %

  	
  0.750

  	
  %

  
	
  Level IV

  	
   

  	
  0.000

  	
  %

  	
  1.000

  	
  %

  

 

 

SCHEDULE 5

 

CURRENTLY APPROVED PERSONS AND FACILITIES

 

 

EXHIBIT A

 

NOTE

 

	
  $

  	
   

  	
  New York, New York

  	
   

  	
                  ,
  200   

  

 

FOR VALUE
RECEIVED, the undersigned, Plains Marketing, L.P., a Delaware limited
partnership (herein called “Borrower”), hereby promises to pay to the order of
                                   
(herein called “Lender”), the principal sum of
                             
($                        ),
or, if greater or less, the aggregate unpaid principal amount of the Loans made
under this Note by Lender to Borrower pursuant to the terms of the Credit
Agreement (as hereinafter defined), together with interest on the unpaid
principal balance thereof as hereinafter set forth, both principal and interest
payable as herein provided in lawful money of the United States of America at
the offices of Administrative Agent under the Credit Agreement, as from time to
time may be designated by the holder of this Note.

 

This Note (a)
is issued and delivered under that certain Credit Agreement dated November 21,
2003 among Borrower, Fleet National Bank, as Administrative Agent, and the lenders
(including Lender) referred to therein (herein, as from time to time
supplemented, amended or restated, called the “Credit Agreement”), and is a
“Note” as defined therein, (b) is subject to the terms and provisions of the
Credit Agreement, which contains provisions for payments and prepayments
hereunder and acceleration of the maturity hereof upon the happening of certain
stated events, and (c) is guaranteed by and entitled to the benefits of certain
guaranties (as identified in the Credit Agreement).  Payments on this Note shall be made and applied as provided
herein and in the Credit Agreement. 
Reference is hereby made to the Credit Agreement for a description of
certain rights, limitations of rights, obligations and duties of the parties
hereto and for the meanings assigned to terms used and not defined herein and
to the guaranties for a description of the nature and extent of the guarantee
thereby provided and the rights of the parties thereto.

 

The principal
amount of this Note shall bear interest and shall be due and payable from time
to time as provided in the Credit Agreement with the remaining unpaid principal
balance of this Note being due and payable in full on or before the Maturity
Date.  Accrued and unpaid interest
hereon shall be due and payable on each Interest Payment Date as provided in
the Credit Agreement and on the Maturity Date.

 

Notwithstanding
the foregoing paragraph and all other provisions of this Note, in no event
shall the interest payable hereon, whether before or after maturity, exceed the
maximum interest which, under applicable Law, may be charged on this Note, and
this Note is expressly made subject to the provisions of the Credit Agreement
which more fully set out the limitations on how interest accrues hereon.

 

If this Note
is placed in the hands of an attorney for collection after default, or if all
or any part of the indebtedness represented hereby is proved, established or
collected in any court or in any bankruptcy, receivership, debtor relief,
probate or other court proceedings, Borrower and

 

1

 

all endorsers, sureties and
guarantors of this Note jointly and severally agree to pay reasonable
attorneys’ fees and collection costs to the holder hereof in addition to the
principal and interest payable hereunder.

 

Borrower and
all endorsers, sureties and guarantors of this Note hereby severally waive
demand, presentment, notice of demand and of dishonor and nonpayment of this
Note, protest, notice of protest, notice of intention to accelerate the
maturity of this Note, declaration or notice of acceleration of the maturity of
this Note, diligence in collecting, the bringing of any suit against any party
and any notice of or defense on account of any extensions, renewals, partial
payments or changes in any manner of or in this Note or in any of its terms,
provisions and covenants, or any releases or substitutions of any security, or
any delay, indulgence or other act of any trustee or any holder hereof, whether
before or after maturity.

 

This Note and the rights and duties
of the parties hereto shall be governed by the Laws of the State of New
York  (without regard to principles of
conflicts of law), except to the extent the same are governed by applicable
federal Law.

 

	
   

  	
  PLAINS
  MARKETING, L.P.

  	 

	
   

  	
   

  	 

	
   

  	
  By:

  	
  PLAINS
  MARKETING GP INC.,

  	 

	
   

  	
   

  	
  its general
  partner

  	 

	
   

  	
   

  	 

	
   

  	
   

  	 

	
   

  	
  By:

  	
   

  	 

	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  

 

2

 

EXHIBIT B-1

 

FINANCING REQUEST-INITIAL

 

Reference is
made to that certain Credit Agreement dated November 21, 2003 among Plains
Marketing, L.P. (“Borrower”), Fleet National Bank, as Administrative Agent, and
certain financial institutions (“Lenders”). 
Terms which are defined in the Agreement are used herein with the
meanings given them in the Agreement.

 

Pursuant to
the terms of the Agreement, Borrower hereby requests Lenders to finance Cash
and Carry Purchases or storage of Hedged Eligible Inventory as set forth on the
attached Schedule, by participating in Letters of Credit to secure such Cash and
Carry Purchases and/or make Loans to finance such Cash and Carry Purchases or
storage of such Hedged Eligible Inventory for the following:

 

Delivery
Month:
                                        ,
200     

 

Sale/Purchase
Month:
                                       ,
200     

 

Funding Date
(Settlement Date for Delivery Month):
                                        ,
200    

 

Hedged Value
of Hedged Eligible Inventory:
$                                        

 

Initial
Financing Request (90% of Hedged Value):
$                                        

 

To induce
Lenders to commit to finance such Cash and Carry Purchases or storage of such
Hedged Eligible Inventory, Borrower hereby represents, warrants, acknowledges,
and agrees to and with Administrative Agent and each Lender that:

 

(a)  The officer or authorized
agent of GP Inc. signing this instrument is the duly elected, qualified and
acting officer or authorized agent of GP Inc. as indicated below such officer’s
signature hereto having all necessary authority to act for the Borrower.

 

(b)  The representations and
warranties of Borrower set forth in the Agreement and the other Loan Documents
are true and correct on and as of the date hereof (except to the extent that
such representation or warranty was made as of a specific date, or updated,
modified or supplemented as of a subsequent date with the consent of Majority
Lenders, then in each such case, such other date), with the same effect as
though such representations and warranties had been made on and as of the date
hereof.

 

(c)  There does not exist on the
date hereof any condition or event which constitutes a Default which has not
been waived in writing as provided in Section 10.1(a) of the Agreement; nor
will any such Default exist upon receipt and application of the financing
requested hereby. Borrower will use all Letters of Credit and Loans hereby
requested in compliance with Section 2.5 of the Agreement.

 

1

 

(d)  The Facility Usage, after
the issuance of Letters of Credit and/or the making of the requested Loans
contemplated hereby, will not be in excess of the Maximum Facility Amount on
the date requested for the issuance of such Letters of Credit or the making of
such Loans.

 

(e) The Petroleum Products inventory described on the attached
Schedule, when purchased by Borrower, will (i) qualify as Hedged Eligible
Inventory as defined in the Agreement, (ii) be located at the Approved
Locations set forth on the attached Schedule and (iii) be subject to the
Hedging Contracts listed on the attached Schedule, with the Hedged Value set
forth thereon.  Borrower hereby grants a
lien on and security interest in all Petroleum Products listed on the attached
Schedule, the related Hedging Contracts specified thereon, to the extent such
Hedging Contracts pertain or relate to such Petroleum Products, all sales
contracts now or hereafter entered into with respect to such Petroleum
Products, to the extent such sales contracts pertain or relate to such
Petroleum Products, all Accounts arising therefrom, and all proceeds thereof,
in favor of Administrative Agent for the benefit of Lenders, and expressly
acknowledges and agrees that all such Petroleum Products, Hedging Contracts,
sales contracts, Accounts and proceeds constitute “Collateral” as defined in
the Security Agreement, and Borrower and Administrative Agent, by its
acceptance hereof, hereby agree that the Security Agreement, and the definition
of “Collateral” set forth therein, is hereby supplemented hereby.

 

(f)  The Loan Documents have not
been modified, amended or supplemented by any unwritten representations or
promises, by any course of dealing, or by any other means not provided for in
Section 10.1(a) of the Agreement.  The
Agreement and the other Loan Documents are hereby ratified, approved, and
confirmed in all respects.

 

The officer or
authorized agent of GP Inc. signing this instrument hereby certifies that, to
the best of his knowledge after due inquiry, the above representations,
warranties, acknowledgments, and agreements of Borrower are true, correct and
complete in all material respects.

 

IN WITNESS
WHEREOF, this instrument is executed as of
                                ,
       .

 

	
   

  	
  PLAINS
  MARKETING, L.P.

  
	
   

  	
   

  
	
   

  	
  By:

  	
  PLAINS
  MARKETING GP INC.,

  
	
   

  	
   

  	
  its general
  partner

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  
				

 

2

 

EXHIBIT B-2

 

FINANCING REQUEST-FINAL

 

Reference is
made to that certain Credit Agreement dated November 21, 2003 among Plains
Marketing, L.P. (“Borrower”), Fleet National Bank, as Administrative Agent, and
certain financial institutions (“Lenders”). 
Terms which are defined in the Agreement are used herein with the
meanings given them in the Agreement.

 

  Pursuant to the terms of the Agreement and
that certain Financing Request-Initial dated
                           ,
200     (the “Initial Request), Borrower hereby amends and
supplements such Initial Request and the Schedule thereto as follows:

 

Delivery
Month:
                                      ,
200    

 

Sale/Purchase
Month:
                                      ,
200    

 

Funding Date
(Settlement Date for Delivery Month):
                                   ,
200    

 

Sale Value of
Hedged Eligible Inventory:
$                                   

 

Final Financing
Request:
$                                   

(90% of lesser
of (i) Sale Value and

(ii) 110% of
Hedged Value as set forth in Initial Request)

 

[In addition,
Borrower hereby requests each Participating Lender consent to financing its
Percentage Share of an additional amount equal to the amount by which the Sale
Value of such Financed Hedged Eligible Inventory as set forth on the attached
Schedule exceeds 110% of the Hedged Value of such Financed Hedged Eligible
Inventory as set forth in the Initial Request].

 

To induce
Participating Lenders to make such Loans, Borrower hereby represents, warrants,
acknowledges, and agrees to and with Administrative Agent and each
Participating Lender that:

 

(a)  The officer or authorized
agent of GP Inc. signing this instrument is the duly elected, qualified and
acting officer or authorized agent of GP Inc. as indicated below such officer’s
signature hereto having all necessary authority to act for the Borrower.

 

(b)  The representations and
warranties of Borrower set forth in the Agreement and the other Loan Documents
are true and correct on and as of the date hereof (except to the extent that
such representation or warranty was made as of a specific date, or updated,
modified or supplemented as of a subsequent date with the consent of Majority
Lenders, then in each such case, such other date), with the same effect as
though such representations and warranties had been made on and as of the date
hereof.

 

1

 

(c)  There does not exist on the
date hereof any condition or event which constitutes a Default which has not
been waived in writing as provided in Section 10.1(a) of the Agreement; nor
will any such Default exist upon receipt and application of the Loans requested
hereby.  Borrower will use the Loans
hereby requested in compliance with Section 2.5 of the Agreement.

 

(d)  The Facility Usage, after
the making of the Loans requested hereby, will not be in excess of the Maximum
Facility Amount on the date requested for the making of such Loans.

 

(e) The Petroleum Products inventory described on the attached Schedule
(i) qualifies as Hedged Eligible Inventory as defined in the Agreement,
(ii) is located at the Approved Locations set forth on the attached Schedule,
(iii) is subject to the Hedging Contracts listed on the attached Schedule, (iv)
is subject to the sales contracts listed on the attached Schedule, with the
Sale Value set forth thereon.  Borrower
hereby grants a lien on and security interest in all Petroleum Products listed
on the attached Schedule, the related Hedging Contracts specified thereon, to
the extent such Hedging Contracts pertain or relate to such Petroleum Products,
the sales contracts listed on the attached Schedule and all other sales
contracts now or hereafter entered into with respect to such Petroleum
Products, to the extent such sales contracts pertain or related to such
Petroleum Products, all Accounts arising therefrom, and all proceeds thereof,
in favor of Administrative Agent for the benefit of Lenders, and expressly
acknowledges and agrees that all such Petroleum Products, Hedging Contracts,
sales contracts, Accounts and proceeds constitute “Collateral” as defined in
the Security Agreement, and Borrower and Administrative Agent, by its acceptance
hereof, hereby agree that the Security Agreement, and the definition of
“Collateral” set forth therein, is hereby supplemented hereby.

 

(f)  The Loan Documents have not
been modified, amended or supplemented by any unwritten representations or
promises, by any course of dealing, or by any other means not provided for in
Section 10.1(a) of the Agreement.  The
Agreement and the other Loan Documents are hereby ratified, approved, and
confirmed in all respects.

 

2

 

The officer or
authorized agent of GP Inc. signing this instrument hereby certifies that, to
the best of his knowledge after due inquiry, the above representations,
warranties, acknowledgments, and agreements of Borrower are true, correct and
complete in all material respects.

 

IN WITNESS
WHEREOF, this instrument is executed as of
                          ,
     .

 

	
   

  	
  PLAINS
  MARKETING, L.P.

  
	
   

  	
   

  
	
   

  	
  By:

  	
  PLAINS
  MARKETING GP INC.,

  
	
   

  	
   

  	
  its general
  partner

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  
				

 

3

 

EXHIBIT B-3

 

BORROWING NOTICE

 

Reference is
made to that certain Credit Agreement dated November 21, 2003 among Plains
Marketing, L.P. (“Borrower”), Fleet National Bank, as Administrative Agent, and
certain financial institutions (“Lenders”). 
Terms which are defined in the Agreement are used herein with the
meanings given them in the Agreement.

 

Pursuant to
the terms of the Agreement and that certain Financing Request-Final dated
                         ,
200     (the “Final Request”), Borrower hereby requests the
Participating Lenders set forth below to make Loans to Borrower in the
aggregate principal amount of $
                    
and specifies the Funding Date set forth below as the date Borrower desires for
Lenders to make such Loans and for Administrative Agent to deliver to Borrower
the proceeds thereof.

 

Delivery
Month:
                              ,
200    

 

Participating
Lenders:
                                                                                                      

 

Funding Date
(Settlement Date for Delivery Month):
                                ,
200     

 

Type of Loan:                      [LIBOR
Loans] [Base Rate Loans]

 

Length of
Interest Rate for LIBOR Loan (1 month):
                             

 

To induce Participating
Lenders to make such Loans, Borrower hereby represents, warrants, acknowledges,
and agrees to and with Administrative Agent and each Participating Lender that:

 

(a)  The officer or authorized
agent of GP Inc. signing this instrument is the duly elected, qualified and
acting officer or authorized agent of GP Inc. as indicated below such officer’s
signature hereto having all necessary authority to act for the Borrower.

 

(b)  The representations and
warranties of Borrower set forth in the Agreement and the other Loan Documents,
including the Final Request) are true and correct on and as of the date hereof
(except to the extent that such representation or warranty was made as of a
specific date, or updated, modified or supplemented as of a subsequent date
with the consent of Majority Lenders, then in each such case, such other date),
with the same effect as though such representations and warranties had been
made on and as of the date hereof.

 

(c)  There does not exist on the
date hereof any condition or event which constitutes a Default which has not
been waived in writing as provided in Section 10.1(a) of the Agreement; nor
will any such Default exist upon receipt and application of the

 

1

 

Loans requested
hereby.  Borrower will use the Loans
hereby requested in compliance with Section 2.5 of the Agreement.

 

(d)  The Facility Usage, after
the making of the Loans requested hereby, will not be in excess of the Maximum
Facility Amount on the date requested for the making of such Loans.

 

(e) The Loans requested hereby will not be in excess of 90% of the
lesser of (i) the Sale Value of the Hedged Eligible Inventory as set forth
in the Final Request and (ii) 110% of Hedged Value as set forth in Initial
Request (as defined in the Final Request).

 

(f)  The Loan Documents have not
been modified, amended or supplemented by any unwritten representations or
promises, by any course of dealing, or by any other means not provided for in
Section 10.1(a) of the Agreement.  The
Agreement and the other Loan Documents are hereby ratified, approved, and
confirmed in all respects.

 

The officer or
authorized agent of GP Inc. signing this instrument hereby certifies that, to
the best of his knowledge after due inquiry, the above representations,
warranties, acknowledgments, and agreements of Borrower are true, correct and
complete in all material respects.

 

IN WITNESS
WHEREOF, this instrument is executed as of
                           ,
       .

 

	
   

  	
  PLAINS
  MARKETING, L.P.

  
	
   

  	
   

  
	
   

  	
  By:

  	
  PLAINS
  MARKETING GP INC.,

  
	
   

  	
   

  	
  its general
  partner

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  
				

 

2

 

EXHIBIT C

 

CONTINUATION/CONVERSION NOTICE

 

Reference is
made to that certain Credit Agreement dated November 21, 2003 among Plains
Marketing, L.P. (“Borrower”), Fleet National Bank, as Administrative Agent, and
certain financial institutions (“Lenders”). 
Terms which are defined in the Agreement are used herein with the
meanings given them in the Agreement.

 

Borrower hereby
requests a conversion or continuation of existing Loans into a new Borrowing
pursuant to Section 2.4 of the Agreement as follows:

 

Existing
Borrowing(s) of Loans to be Continued or Converted:

 

$                             
of LIBOR Loans with Interest Period ending

 

 

$                             
of Base Rate Loans

 

	
  Aggregate
  amount of new Borrowing:

  	
   

  	
  $

  	
   

  
	
   

  	
   

  	
   

  
	
  Type of
  Loans in new Borrowing:

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  Date of
  Continuation or Conversion:

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  Length of
  Interest Period for LIBOR Loans

  	
   

  	
   

  
	
  (1, 2, 3, 6,
  or 12 months):

  	
   

  	
  months

  

 

Borrower
hereby represents, warrants, acknowledges, and agrees to and with each Lender
that:

 

(a)  The officer or authorized
agent of GP Inc. signing this instrument is the duly elected, qualified and
acting officer or authorized agent of GP Inc. as indicated below such officer’s
signature hereto having all necessary authority to act for the Borrower.

 

(b)  There does not exist on the
date hereof any condition or event which constitutes a Default which has not
been waived in writing as provided in Section 10.1(a) of the Agreement; nor
will any such Default exist upon receipt and application of the Loans requested
hereby.

 

(c)  The Loan Documents have not
been modified, amended or supplemented by any unwritten representations or
promises, by any course of dealing, or by any other means not provided for in
Section 10.1(a) of the Agreement.  The
Agreement and the other Loan Documents are hereby ratified, approved, and
confirmed in all respects.

 

1

 

The officer or
authorized agent of GP Inc. signing this instrument hereby certifies that, to
the best of his knowledge after due inquiry, the above representations,
warranties, acknowledgments, and agreements of Borrower are true, correct and
complete in all material respects.

 

IN WITNESS
WHEREOF, this instrument is executed as of
                          ,
     .

 

	
   

  	
  PLAINS
  MARKETING, L.P.

  
	
   

  	
   

  
	
   

  	
  By:

  	
  PLAINS
  MARKETING GP INC.,

  
	
   

  	
   

  	
  its general
  partner

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  
				

 

2

 

EXHIBIT D-1

 

OPINION OF IN-HOUSE COUNSEL TO BORROWER

 

3

 

EXHIBIT D-2

 

OPINION OF FULBRIGHT & JAWORSKI, L.L.P., COUNSEL TO BORROWER

 

4

 

EXHIBIT E

 

LETTER OF CREDIT APPLICATION AND AGREEMENT

 

5

 

EXHIBIT F

 

 

	
  Irrevocable
  Standby Letter of Credit

  	
  DATE:

  	
   

  
	
   

  	
   

  
	
  BENEFICIARY

  	
  CONFIRMING
  OUR CABLE OF TODAY

  
	
   

  	
   

  
	
   

  	
  Credit
  Number:

  	
   

  
				

 

 

Dear Sir or Madam:

 

BY ORDER OF:

PLAINS
MARKETING, L.P.

 

HOUSTON,
TX  77002

 

We hereby open in your favor
our Irrevocable Standby Letter of Credit for the account of PLAINS MARKETING,
L.P. for a sum of approximately US DOLLARS
                             
(                                                                          )
available by your draft(s) at SIGHT on OURSELVES effective
                              
and expiring at OUR COUNTERS on
                                  .

 

DRAFTS MUST BE ACCOMPANIED BY:

 

1.                                       COPY(IES)
OF COMMERCIAL INVOICE(S) MARKED “UNPAID” ISSUED TO PLAINS MARKETING, L.P.  COVERING CRUDE OIL DELIVERED IN
                        ,
         .

 

2.                                       WARRANTY
OF TITLE ISSUED TO PLAINS MARKETING, L.P. 
AND SIGNED BY AN AUTHORIZED REPRESENTATIVE OF
                                                                                      
CERTIFYING THAT “IN CONSIDERATION OF YOUR PAYMENT OF THE ATTACHED INVOICE, WE
HEREBY EXPRESSLY WARRANT THAT WE HAD MARKETABLE TITLE TO SUCH MATERIAL, AND
THAT WE HAD FULL RIGHT AND AUTHORITY TO TRANSFER AND EFFECT DELIVERY OF SUCH
MATERIAL TO YOU OR YOUR ASSIGNS AND HEREBY AGREE TO PROTECT, INDEMNIFY AND HOLD
PLAINS MARKETING, L.P. HARMLESS FROM AND AGAINST ANY AND ALL COSTS, DAMAGES,
EXPENSES, AND CLAIMS, INCLUDING BUT NOT LIMITED TO REASONABLE ATTORNEY’S FEES,
WHICH YOU MIGHT SUFFER OR INCUR ARISING OR RESULTING FROM ANY BREACH OF THE
ABOVE WARRANTY.”

 

3.                                       A
STATEMENT SIGNED BY AN AUTHORIZED REPRESENTATIVE OF
                                                                 
                       STATING
THAT:                                                                             
HEREBY CERTIFIES THAT INVOICED QUANTITIES OF

 

1

 

PRODUCT HAVE BEEN DELIVERED
FREE AND CLEAR OF ALL LIENS AND ENCUMBRANCES TO PLAINS MARKETING, L.P. WHICH
HAS FAILED TO PAY FOR THIS PRODUCT, AND THE MONIES HEREBY DRAWN ARE DUE AND
PAYABLE.

 

SPECIAL CONDITIONS:

 

A.                                   THIS
LETTER OF CREDIT IS AVAILABLE FOR PAYMENT AT SIGHT BUT NOT PRIOR TO
                              ,
                    .

 

B.                                     THE
AMOUNT AVAILABLE FOR DRAWING UNDER THIS LETTER OF CREDIT WILL BE REDUCED BY THE
AMOUNT OF ANY PAYMENT(S) MADE OUTSIDE THIS LETTER OF CREDIT TO
                                                        
                                               
BY PLAINS MARKETING, L.P. FOR THIS PRODUCT IF SUCH PAYMENT(S) IS/ARE MADE
THROUGH FLEET NATIONAL BANK, BOSTON, MA REFERENCING THIS LETTER OF CREDIT
NUMBER.

 

C.                                     ALL
BANKING CHARGES OTHER THAN THOSE OF FLEET NATIONAL BANK ARE FOR THE ACCOUNT OF
THE BENEFICIARY.

 

D.                                    PARTIAL
DRAWINGS AND PARTIAL SHIPMENTS ARE PERMITTED.

 

E.                                      COMMERCIAL
INVOICE(S) REFERENCED ABOVE IN EXCESS OF THE U.S. DOLLAR AMOUNT OF THIS LETTER
OF CREDIT IS (ARE) ACCEPTABLE; HOWEVER, PAYMENT NOT TO EXCEED THE VALUE OF THIS
LETTER OF CREDIT.

 

F.                                      DOCUMENTS
PRESENTED MORE THAN TWENTY-ONE DAYS AFTER THE TRANSPORT DATE BUT WITHIN THE
VALIDITY OF THIS CREDIT ARE ACCEPTABLE.

 

Except so far as otherwise
expressly stated herein, this letter of credit is subject to the “Uniform
Customs and Practice for Documentary Credits (1993 Revision), International
Chamber of Commerce Publication No. 500.”

 

We hereby agree that drafts
drawn under and in compliance with the terms of this letter of credit will be
duly honored if presented to the above-mentioned drawee bank on or before
                                 ,
           .

 

The word “approximately”,
insofar as it refers to the amount of this credit, is to be construed as
allowing a difference not to exceed 10% more or 10% less.

 

2

 

Kindly address all
correspondence regarding this letter of credit to the attention of our Letter
of Credit Operations, P.O. Box 1763, BOSTON, MA 02105, attention
                                      ,
mentioning our reference number as it appears above.  Telephone inquiries can be made to                                            
at                                         .

 

 

	
   

  	
  Very truly
  yours,

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  Authorized
  Official

  

 

3

 

EXHIBIT G

 

ASSIGNMENT AND ACCEPTANCE

 

Reference is
made to that certain Credit Agreement dated as of November 21, 2003 (as from
time to time amended, the “Agreement”), by and among Plains Marketing, L.P.
(“Borrower”), Fleet National Bank, as Administrative Agent, and certain
financial institutions (“Lenders”). 
Terms which are defined in the Agreement are used herein with the
meanings given them in the Agreement.

 

The “Assignor”
and the “Assignee” referred to on Schedule 1 agree as follows:

 

1.                                       The
Assignor hereby sells and assigns to the Assignee, without recourse and without
representation or warranty except as expressly set forth herein, and the
Assignee hereby purchases and assumes from the Assignor, an interest in and to
the Assignor’s rights and obligations under the Agreement and the other Loan
Documents as of the date hereof equal to the percentage interest specified on
Schedule 1 of all outstanding rights and obligations under the Agreement and
the other Loan Documents with respect to the Loans and commitment, if any.  After giving effect to such sale and
assignment, the Assignee’s amount of the Loans owing to the Assignee will be as
set forth on Schedule 1.

 

2.                                       The
Assignor (i) represents and warrants that it is the legal and beneficial owner
of the interest being assigned by it hereunder and that such interest is free
and clear of any adverse claim; (ii) makes no representation or warranty and
assumes no responsibility with respect to any statements, warranties or
representations made in or in connection with the Loan Documents or the
execution, legality, validity, enforceability, genuineness, sufficiency or
value of the Loan Documents or any other instrument or document furnished
pursuant thereto; (iii) makes no representation or warranty and assumes no
responsibility with respect to the financial condition of Borrower or the
performance or observance by Borrower of any of its obligations under the Loan
Documents or any other instrument or document furnished pursuant thereto; and
(iv) attaches the Note held by the Assignor and requests that Administrative
Agent exchange such Note for [a new Note payable to the order of the Assignee]
[new Notes in an amount equal to Assignee’s Percentage Share of the Maximum Facility
Amount assumed by the Assignee pursuant hereto and to the Assignor in an amount
equal to its Percentage Share of the Maximum Facility Amount retained by the
Assignor, if any], as specified on Schedule 1.

 

3.                                       The
Assignee (i) confirms that it has received a copy of the Agreement, together
with copies of the financial statements referred to in Section 6.2 thereof and
such other documents and information as it has deemed appropriate to make its
own credit analysis and decision to enter into this Assignment and Acceptance;
(ii) agrees that it will, independently and without reliance upon
Administrative Agent, the Assignor or any other Lender and based on such
documents and information as it shall deem appropriate at the time, continue to
make its own credit decisions in taking or not taking action under the
Agreement; (iii) confirms that it is an Eligible Transferee, (iv) appoints
and authorizes Administrative Agent to take such action as agent on its behalf
and to exercise such powers and discretion under the Agreement as are delegated
to Administrative Agent by the terms thereof, together with such powers and
discretion

 

1

 

as are reasonably incidental
thereto; (v) agrees that it will perform in accordance with their terms all of
the obligations that by the terms of the Agreement are required to be performed
by it as a Lender; and (vi) attaches any U.S. Internal Revenue Service or other
forms required under Section 10.5.

 

4.                                       Following
the execution of this Assignment and Acceptance, it will be delivered to
Administrative Agent for acceptance and recording by Administrative Agent.  The effective date for this Assignment and
Acceptance (the “Effective Date”) shall be the date of acceptance hereof
by Administrative Agent, unless otherwise specified on Schedule 1.

 

5.                                       Upon
such acceptance and recording by Administrative Agent, as of the Effective
Date, (i) the Assignee shall be a party to the Agreement and, to the extent
provided in this Assignment and Acceptance, have the rights and obligations of
a Lender thereunder and (ii) the Assignor shall, to the extent provided in this
Assignment and Acceptance, relinquish its rights and be released from its
obligations under the Agreement.

 

6.                                       Upon
such acceptance and recording by Administrative Agent, from and after the
Effective Date, Administrative Agent shall make all payments under the
Agreement and the Notes in respect of the interest assigned hereby (including,
without limitation, all payments of principal, interest and commitment fees
with respect thereto) to the Assignee. 
The Assignor and Assignee shall make all appropriate adjustments in
payments under the Agreement and the Notes for periods prior to the Effective
Date directly between themselves.

 

7.                                       This
Assignment and Acceptance shall be governed by, and construed in accordance
with, the Laws of the State of New York.

 

8.                                       This
Assignment and Acceptance may be executed in any number of counterparts and by
different parties hereto in separate counterparts, each of which when so
executed shall be deemed to be an original and all of which taken together
shall constitute one and the same agreement. Delivery of an executed
counterpart of Schedule 1 to this Assignment and Acceptance by telecopier shall
be effective as delivery of a manually executed counterpart of this Assignment
and Acceptance.

 

IN WITNESS
WHEREOF, the Assignor and the Assignee have caused Schedule 1 to this
Assignment and Acceptance to be executed by their officers thereunto duly
authorized as of the date specified thereon.

 

2

 

SCHEDULE 1 to ASSIGNMENT AND ACCEPTANCE

 

	
  Assignee’s Percentage Share of Maximum
  Facility Amount:

  	
   

  	
  $

  	
   

  
	
  Assignee’s
  Percentage Share:

  	
   

  	
   

  	
  %

  
	
  Aggregate outstanding principal amount of
  Loans assigned:

  	
   

  	
  $

  	
   

  
	
  Principal
  amount of Note payable to Assignee:

  	
   

  	
  $

  	
   

  
	
  Principal amount of Note payable to
  Assignor (if retained):

  	
   

  	
  $

  	
  ]

  

 

 

	
  Effective
  Date (if other than date of acceptance

  	
   

  	
   

  
	
  by
  Administrative Agent:

  	
   

  	
  *                         ,
  200    

  

 

	
   

  	
  [NAME OF
  ASSIGNOR], as Assignor

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
  Title:

  
	
   

  	
   

  
	
   

  	
  Dated:
              ,
  200     

  
	
   

  	
   

  
	
   

  	
  [NAME OF
  ASSIGNEE], as Assignee

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
  Title:

  
	
   

  	
   

  
	
   

  	
  Domestic
  Lending Office:

  
	
   

  	
  LIBOR
  Lending Office:

  
							

 

*                                         This
date should be no earlier than five Business Days after the delivery of this
Assignment and Acceptance to Administrative Agent.

 

	
  Accepted
  this       day of
                      ,
  200     

  	
   

  
	
   

  	
   

  
	
  FLEET
  NATIONAL BANK

  	
   

  
	
   

  	
   

  
	
  By:

  	
   

  	
   

  	
   

  
	
  Title:

  	
   

  
	
   

  	
   

  
	
  [Approved
  this          day of
                           ,
  200     

  	
   

  
	
   

  	
   

  
	
  [PLAINS
  MARKETING, L.P.

  	
   

  
	
  By:

  	
  PLAINS
  MARKETING GP INC., its general partner

  	
   

  
	
   

  	
   

  
	
  By:

  	
   

  	
   

  	
   

  
	
   

  	
  Title:EXHIBIT 10.22

 

 

CREDIT AGREEMENT

[US/Canada
Facilities]

 

 

PLAINS
ALL AMERICAN PIPELINE, L.P., as US Borrower,

 

PMC
(NOVA SCOTIA) COMPANY, as Canadian Borrower,

PLAINS
ALL AMERICAN PIPELINE, L.P., as Guarantor,

 

FLEET
NATIONAL BANK, as Administrative Agent,

 

and
CERTAIN FINANCIAL INSTITUTIONS, as US Lenders

 

$425,000,000
Revolving Credit Facility

 

$170,000,000
Revolving Credit Facility

 

 

PLAINS
MARKETING CANADA, L.P., as Canadian Working Capital Borrower,

PLAINS
ALL AMERICAN PIPELINE, L.P., as Guarantor,

 

THE
BANK OF NOVA SCOTIA, as Canadian Administrative Agent,

 

and
CERTAIN FINANCIAL INSTITUTIONS, as Canadian Lenders

 

$30,000,000
Canadian Revolving Credit Facility

 

 

FLEET
SECURITIES, INC., as Lead Arranger and Book Manager,

 

WACHOVIA
BANK, NATIONAL ASSOCIATION and BANK ONE, NA

as
Co-Syndication Agents, and

 

BANK
OF AMERICA, N.A. and FORTIS CAPITAL CORP., as Co-Documentation Agents,

 

 

November 21, 2003

 

 

 

TABLE OF CONTENTS

 

	
  ARTICLE I - Definitions and References

  	
   

  
	
   

  	
  Section
  1.1.  Defined Terms

  	
   

  
	
   

  	
  Section
  1.2.  Exhibits and Schedules;
  Additional Definitions

  	
   

  
	
   

  	
  Section
  1.3.  Amendment of Defined Instruments

  	
   

  
	
   

  	
  Section
  1.4.  References and Titles

  	
   

  
	
   

  	
  Section
  1.5.  Calculations and Determinations

  	
   

  
	
   

  	
   

  	
   

  
	
  ARTICLE II - The Loans

  	
   

  
	
   

  	
  Section
  2.1.  Commitments to Lend; Notes

  	
   

  
	
   

  	
  Section
  2.2.  Requests for Loans

  	
   

  
	
   

  	
  Section
  2.3.  Continuations and Conversions of
  Existing Loans

  	
   

  
	
   

  	
  Section
  2.4.  Use of Proceeds

  	
   

  
	
   

  	
  Section
  2.5.  Interest Rates and Fees

  	
   

  
	
   

  	
  Section
  2.6.  Extension of Canadian Conversion
  Date.

  	
   

  
	
   

  	
  Section
  2.7.  Conversion to Canadian Term Loan

  	
   

  
	
   

  	
  Section
  2.8.  Optional Prepayments

  	
   

  
	
   

  	
  Section
  2.9.  Mandatory Prepayments.

  	
   

  
	
   

  	
  Section
  2.10.  Letters of Credit

  	
   

  
	
   

  	
  Section
  2.11.  Requesting Letters of Credit

  	
   

  
	
   

  	
  Section
  2.12.  Reimbursement and
  Participations

  	
   

  
	
   

  	
  Section
  2.13.  Letter of Credit Fees

  	
   

  
	
   

  	
  Section
  2.14.  No Duty to Inquire

  	
   

  
	
   

  	
  Section
  2.15.  Creation of Bankers’
  Acceptances

  	
   

  
	
   

  	
  Section
  2.16.  Terms of Acceptance by Canadian
  Lenders

  	
   

  
	
   

  	
  Section
  2.17.  General Procedures for Bankers’
  Acceptances

  	
   

  
	
   

  	
  Section
  2.18.  Execution of Bankers’
  Acceptances

  	
   

  
	
   

  	
  Section
  2.19.  Prepayment of Bankers’
  Acceptances

  	
   

  
	
   

  	
   

  	
   

  
	
  ARTICLE III - Payments to Lenders

  	
   

  
	
   

  	
  Section
  3.1.  General Procedures

  	
   

  
	
   

  	
  Section
  3.2.  Capital Reimbursement

  	
   

  
	
   

  	
  Section
  3.3.  Increased Cost of LIBOR Loans or
  Letters of Credit

  	
   

  
	
   

  	
  Section
  3.4.  Notice; Change of Applicable
  Lending Office

  	
   

  
	
   

  	
  Section
  3.5.  Availability

  	
   

  
	
   

  	
  Section
  3.6.  Funding Losses

  	
   

  
	
   

  	
  Section
  3.7.  Reimbursable Taxes

  	
   

  
	
   

  	
  Section
  3.8.  Replacement of Lenders.

  	
   

  
	
   

  	
  Section
  3.9.  Currency Conversion and
  Indemnity

  	
   

  
	
   

  	
   

  	
   

  
	
  ARTICLE IV - Conditions Precedent to
  Lending

  	
   

  
	
   

  	
  Section
  4.1.  Documents to be Delivered

  	
   

  
	
   

  	
  Section
  4.2.  Additional Conditions Precedent

  	
   

  

 

i

 

	
  ARTICLE V - Representations and Warranties

  	
   

  
	
   

  	
  Section
  5.1.  No Default

  	
   

  
	
   

  	
  Section
  5.2.  Organization and Good Standing

  	
   

  
	
   

  	
  Section
  5.3.  Authorization

  	
   

  
	
   

  	
  Section
  5.4.  No Conflicts or Consents

  	
   

  
	
   

  	
  Section
  5.5.  Enforceable Obligations

  	
   

  
	
   

  	
  Section
  5.6.  Initial Financial Statements

  	
   

  
	
   

  	
  Section
  5.7.  Other Obligations and Restrictions.

  	
   

  
	
   

  	
  Section
  5.8.  Full Disclosure

  	
   

  
	
   

  	
  Section
  5.9.  Litigation

  	
   

  
	
   

  	
  Section
  5.10.  ERISA Plans and Liabilities

  	
   

  
	
   

  	
  Section
  5.11.  Compliance with Permits,
  Consents and Law

  	
   

  
	
   

  	
  Section
  5.12.  Environmental Laws

  	
   

  
	
   

  	
  Section
  5.13.  US Borrower’s Subsidiaries

  	
   

  
	
   

  	
  Section
  5.14.  Title to Properties

  	
   

  
	
   

  	
  Section
  5.15.  Government Regulation

  	
   

  
	
   

  	
  Section
  5.16.  Insider

  	
   

  
	
   

  	
  Section
  5.17.  Solvency

  	
   

  
	
   

  	
  Section
  5.18.  Not a “Reportable Transaction”

  	
   

  
	
   

  	
   

  	
   

  
	
  ARTICLE VI - Affirmative Covenants

  	
   

  
	
   

  	
  Section
  6.1.  Payment and Performance

  	
   

  
	
   

  	
  Section
  6.2.  Books, Financial Statements and
  Reports.

  	
   

  
	
   

  	
  Section
  6.3.  Other Information and
  Inspections

  	
   

  
	
   

  	
  Section
  6.4.  Notice of Material Events

  	
   

  
	
   

  	
  Section
  6.5.  Maintenance of Existence,
  Qualifications and Assets

  	
   

  
	
   

  	
  Section
  6.6.  Payment of Taxes, etc.

  	
   

  
	
   

  	
  Section
  6.7.  Insurance

  	
   

  
	
   

  	
  Section
  6.8.  Compliance with Agreements and
  Law

  	
   

  
	
   

  	
  Section
  6.9.  Guaranties of Subsidiaries

  	
   

  
	
   

  	
   

  	
   

  
	
  ARTICLE VII - Negative Covenants

  	
   

  
	
   

  	
  Section
  7.1.  Subsidiary Indebtedness

  	
   

  
	
   

  	
  Section
  7.2.  Limitation on Liens

  	
   

  
	
   

  	
  Section
  7.3.  Limitation on Mergers

  	
   

  
	
   

  	
  Section
  7.4.  Limitation on New Businesses

  	
   

  
	
   

  	
  Section
  7.5.  Transactions with Affiliates

  	
   

  
	
   

  	
  Section
  7.6.  Limitation on Distributions

  	
   

  
	
   

  	
  Section
  7.7.  Restricted Contracts

  	
   

  
	
   

  	
  Section
  7.8.  Debt Coverage Ratio

  	
   

  
	
   

  	
  Section
  7.9.  Interest Coverage Ratio

  	
   

  
	
   

  	
  Section
  7.10.  Unrestricted Subsidiaries

  	
   

  
	
   

  	
  Section
  7.11.  No Negative Pledges

  	
   

  
	
   

  	
   

  	
   

  
	
  ARTICLE VIII - Events of Default and
  Remedies

  	
   

  
	
   

  	
  Section
  8.1.  Events of Default

  	
   

  
	
   

  	
  Section
  8.2.  Remedies

  	
   

  

 

ii

 

	
  ARTICLE IX - Agents

  	
   

  
	
   

  	
  Section
  9.1.  Appointment and Authority

  	
   

  
	
   

  	
  Section
  9.2.  Exculpation, Agent’s Reliance,
  Etc.

  	
   

  
	
   

  	
  Section
  9.3.  Credit Decisions

  	
   

  
	
   

  	
  Section
  9.4.  Indemnification

  	
   

  
	
   

  	
  Section
  9.5.  Rights as Lender

  	
   

  
	
   

  	
  Section
  9.6.  Sharing of Set-Offs and Other
  Payments

  	
   

  
	
   

  	
  Section
  9.7.  Investments

  	
   

  
	
   

  	
  Section
  9.8.  Benefit of Article IX

  	
   

  
	
   

  	
  Section
  9.9.  Resignation

  	
   

  
	
   

  	
  Section
  9.10.  Other Agents

  	
   

  
	
   

  	
   

  	
   

  
	
  ARTICLE X - Miscellaneous

  	
   

  
	
   

  	
  Section
  10.1.  Waivers and Amendments;
  Acknowledgments

  	
   

  
	
   

  	
  Section
  10.2.  Survival of Agreements;
  Cumulative Nature

  	
   

  
	
   

  	
  Section
  10.3.  Notices

  	
   

  
	
   

  	
  Section
  10.4.  Payment of Expenses; Indemnity

  	
   

  
	
   

  	
  Section
  10.5.  Joint and Several Liability;
  Parties in Interest; Assignments; Replacement Notes

  	
   

  
	
   

  	
  Section
  10.6.  Confidentiality

  	
   

  
	
   

  	
  Section
  10.7.  Governing Law; Submission to
  Process

  	
   

  
	
   

  	
  Section
  10.8.  Waiver of Judgment Interest Act
  (Alberta)

  	
   

  
	
   

  	
  Section
  10.9.  Deemed Reinvestment Not Applicable

  	
   

  
	
   

  	
  Section
  10.10.  Limitation on Interest

  	
   

  
	
   

  	
  Section
  10.11.  Right of Offset

  	
   

  
	
   

  	
  Section
  10.12.  Termination; Limited Survival

  	
   

  
	
   

  	
  Section
  10.13.  Severability

  	
   

  
	
   

  	
  Section
  10.14.  Counterparts

  	
   

  
	
   

  	
  Section
  10.15.  Waiver of Jury Trial, Punitive
  Damages, etc.

  	
   

  

 

iii

 

Schedules and Exhibits:

 

Schedule 1 - Lender Schedule

Schedule 2 - Disclosure
Schedule

Schedule 3 - Pricing Grid

 

Exhibit A-1 - US Note

Exhibit A-2 - Canadian Note

Exhibit A-3 - Canadian Working
Capital Note

Exhibit B-1 - US Borrowing
Notice

Exhibit B-2 - Canadian
Borrowing Notice

Exhibit C-1 - US
Continuation/Conversion Notice

Exhibit C-2 - Canadian
Continuation/Conversion Notice

Exhibit D -  Certificate Accompanying Financial
Statements

Exhibit E-1 - Opinion of
In-House Counsel for Restricted Persons

Exhibit E-2 - Opinion of
Fulbright & Jaworski L.L.P., Counsel for Restricted Persons

Exhibit E-3 - Opinion of
Bennett Jones, Canadian Counsel for Restricted Persons

Exhibit F-1 - US Letter of
Credit Application and Agreement

Exhibit F-2 - Canadian Letter
of Credit Application and Agreement

Exhibit G - Assignment and
Acceptance Agreement

 

iv

 

CREDIT AGREEMENT

[US/Canada Facilities]

 

THIS CREDIT
AGREEMENT [US/Canada Facilities] is made as of November 21, 2003, by and among
PLAINS ALL AMERICAN PIPELINE, L.P., a Delaware limited partnership (“US
Borrower”), PMC (NOVA SCOTIA) COMPANY, a Nova Scotia unlimited liability
company (“Canadian Borrower”), and PLAINS MARKETING CANADA, L.P., an
Alberta limited partnership (“Canadian Working Capital Borrower”), FLEET
NATIONAL BANK, as administrative agent (in such capacity, “Administrative
Agent”), WACHOVIA BANK, NATIONAL ASSOCIATION and BANK ONE, NA, as
co-syndication agents (in such capacity, “Co-Syndication Agents”), BANK
OF AMERICA, N.A. and FORTIS CAPITAL CORP., as co-documentation agents (in such
capacity, “Co-Documentation Agents”), and THE BANK OF NOVA SCOTIA, as
Canadian Administrative Agent (in such capacity, “Canadian Administrative
Agent”) and FLEET SECURITIES, INC., as lead arranger and book manager
(in such capacity, “Lead Arranger and Book Manager”) and the
Lenders referred to below.  In
consideration of the mutual covenants and agreements contained herein the
parties hereto agree as follows:

 

W I T N E S S E T H

 

In
consideration of the mutual covenants and agreements contained herein and in
consideration of the loans which may hereafter by made by Lenders and the
Letters of Credit which may be made available by LC Issuer and Canadian LC
Issuer to US Borrower, Canadian Borrower, and Canadian Working Capital Borrower
and for other good and valuable consideration, the receipt and sufficiency of
which are hereby acknowledged, the parties hereto agree as follows:

 

ARTICLE I - Definitions and References

 

Section 1.1.  Defined Terms.  As used in this Agreement, each of the
following terms has the meaning given to such term  in this Section 1.1 or in the sections and subsections referred
to below:

 

“Acquisition
Period” means the period beginning, at the election of US Borrower, with
the funding date of the purchase price for a Specified Acquisition and ending
on the earliest of (a) the third following Fiscal Quarter end, (b) US
Borrower’s receipt of proceeds of a Specified Equity Offering; and (c) US
Borrower’s election in writing to terminate such Acquisition Period (provided,
at the time of such election, the Debt Coverage Ratio shall not, on a pro forma
basis, exceed 4.50 to 1.00); provided, however, if the Debt
Coverage Ratio exceeds 4.50 to 1.00 at the end of the Fiscal Quarter ending
next following such funding date, then the Acquisition Period shall be deemed
to have commenced as of such funding date; provided, further,
during any Acquisition Period, no additional Acquisition Period shall commence,
nor shall such Acquisition Period be extended, by any subsequent Specified
Acquisition until the current Acquisition Period shall have expired and US
Borrower shall be in compliance with Section 7.8(ii).

 

“Administrative
Agent” means Fleet National Bank, as Administrative Agent hereunder, and
its successors in such capacity.

 

 

“Affiliate” means, as to any Person,
each other Person that directly or indirectly (through one or more
intermediaries or otherwise) controls, is controlled by, or is under common
control with, such Person.  A Person
shall be deemed to be “controlled by” any other Person if such other Person
possesses, directly or indirectly, power to direct or cause the direction of
the management and policies of such Person whether by contract or otherwise.

 

“Agent”
means (i) with respect to US Loans, Administrative Agent, (ii) with respect to
Canadian Loans, Canadian Administrative Agent, and (iii) their respective
successors in such capacity.

 

“Aggregate
Percentage Share” means, with respect to a Lender, the percentage obtained
by dividing (a) the sum of (i) such Lender’s Lender Commitment plus (ii) if
such Lender has no outstanding Canadian Commitment, the outstanding principal
amount of US Loans to Canadian Borrower by such Lender (if any), divided by (b)
the sum of (i) the Commitment plus (ii) the outstanding principal amount of US
Loans to Canadian Borrower by all Lenders with no outstanding Canadian
Commitment.

 

“Agreement”
means this Credit Agreement.

 

“All
American” means All American Pipeline, L.P., a Texas limited partnership.

 

“Applicable
Lending Office” means, for each Lender and for each Type of Loan, the
“Lending Office” of such Lender (or of an Affiliate of such Lender) designated
for such Type of Loan on the Lender Schedule or such other office of such
Lender (or an Affiliate of such Lender) as such Lender may from time to time
specify to Administrative Agent or Canadian Administrative Agent, as
applicable, and US Borrower by written notice in accordance with the terms
hereof as the office by which its Loans of such Type are to be made and maintained.

 

“Applicable
Margin” means, as to any Type of Loan, 
the percent per annum set forth on the Pricing Grid as the “Applicable
Margin” for such Type of Loan, based on the Applicable Rating Level in effect
on such date.  Changes in the Applicable
Margin will occur automatically without prior notice as changes in the
Applicable Rating Level occur. 
Administrative Agent will give notice promptly to Borrowers, Canadian
Administrative Agent and Lenders of changes in the Applicable Margin.

 

“Applicable
Rating Level” means for any day, the level set forth below that corresponds
to the PAA Debt Rating by the Ratings Agencies applicable on such day; provided,
in the event the PAA Debt Rating by the Ratings Agencies differs by one level,
the higher PAA Debt Rating shall apply; provided  further, in the
event the PAA Debt Rating by the Ratings Agencies differs by more than one
level, the PAA Debt Rating one level above the lower PAA Debt Rating shall
apply; provided, notwithstanding the foregoing, the Applicable Rating
Level for the period from the date hereof through and including February 21,
2004 shall be Level III.  As used in
this definition, “>“ means a rating equal to or more favorable than
and “<“ means a rating less favorable than.

 

2

 

	
  Rating Level

  	
   

  	
  S&P

  	
   

  	
  Moody’s

  
	
  Level I

  	
   

  	
  > BBB+

  	
   

  	
  > Baa1

  
	
  Level II

  	
   

  	
  BBB

  	
   

  	
  Baa2

  
	
  Level III

  	
   

  	
  BBB-

  	
   

  	
  Baa3

  
	
  Level IV

  	
   

  	
  < BBB-

  	
   

  	
  < Baa3

  

 

If either of the Rating
Agencies shall not have in effect a PAA Debt Rating or if the rating system of
either of the Rating Agencies shall change, or if either of the Rating Agencies
shall cease to be in the business of rating corporate debt obligations, US
Borrower and Majority Lenders shall negotiate in good faith to amend this
definition to reflect such changed rating system or the unavailability of
ratings from such Rating Agency, but until such an agreement shall be reached,
the Applicable Rating Level shall be based only upon the PAA Debt Rating by the
remaining Rating Agency.

 

“BA
Discount Rate” means, in respect of a BA being accepted by a Canadian
Lender on any date, (i) for a Canadian Lender that is listed in Schedule I
to the Bank Act (Canada), the
average bankers’ acceptance rate as quoted on Reuters CDOR page (or such other
page as may, from time to time, replace such page on that service for the
purpose of displaying quotations for bankers’ acceptances accepted by leading
Canadian financial institutions) at approximately 10:00 a.m. (Toronto, Ontario
time) on such drawdown date for bankers’ acceptances having a comparable
maturity date as the maturity date of such BA (the “CDOR Rate”); or, if
such rate is not available at or about such time, the average of the bankers’
acceptance rates (expressed to five decimal places) as quoted to the Canadian
Administrative Agent by the Schedule I BA Reference Banks as of 10:00 a.m.
(Toronto, Ontario time) on such drawdown date for bankers’ acceptances having a
comparable maturity date as the maturity date of such BA; and (ii) for a
Canadian Lender that is listed in Schedule II to the Bank Act (Canada) or a Canadian Lender that is listed in
Schedule III to the Bank Act
(Canada) that is not subject to the restrictions and requirements referred to
in subsection 524 (2) of the Bank Act
(Canada), the rate established by the Canadian Administrative Agent to be the
lesser of (A) the CDOR Rate plus 10 Basis Points and (B) the average
of the bankers’ acceptance rates (expressed to five decimal places) as quoted
to the Canadian Administrative Agent by the Schedule II BA Reference Banks as
of 10:00 a.m. (Toronto, Ontario time) on such drawdown date for bankers’
acceptances having a comparable maturity date as the maturity date of such BA.

 

“BA
Equivalent Advance” means a Canadian Advance provided hereunder by a
Canadian Lender in lieu of accepting and purchasing a BA pursuant to Section
2.16(f).

 

“Bankers’
Acceptance” or “BA” means a non-interest bearing bill of exchange on
a Canadian Lender’s usual form (or a bill of exchange within the meaning of the
Bill of Exchange Act Canada), or a depository bill within the meaning of the
Depository Bills and Notes Act (Canada), denominated in Canadian Dollars, drawn
by or on behalf of Canadian Working Capital Borrower, for a term selected by
Canadian Working Capital Borrower of either one, two, three or six months (as
reduced or extended by Canadian Administrative Agent, acting reasonably, to
allow the maturity thereof to fall on a Business Day) payable in Canada, and
accepted by a Canadian Lender in accordance with this Agreement.

 

3

 

“Bankruptcy
and Insolvency Act (Canada)” means the
Bankruptcy and Insolvency Act, S.C. 1992, c. 27, including the
regulations made and, from time to time, in force under that Act.

 

“Base Rate”
means the higher of (i) the variable per annum rate of interest so designated
from time to time by Administrative Agent as its “prime rate”, or (ii) the
Federal Funds Rate plus one-half percent (0.5%) per annum.  The “prime rate” is a reference rate and
does not necessarily represent the lowest or best rate being charged to any
customer.  Changes in the Base Rate
resulting from changes in the “prime rate” shall take place immediately without
notice or demand of any kind.

 

“Base Rate
Loan” means a US Loan to US Borrower or to Canadian Borrower which does not
bear interest at a rate based upon the LIBOR Rate.

 

“Borrowers”
means, collectively, US Borrower, Canadian Borrower, and Canadian Working
Capital Borrower, and their successors and assigns, in each case, so long as it
is permitted to borrow hereunder or request the issuance of a Letter of Credit;
“Borrower” means, individually, any of such Persons.

 

“Borrowing”
means a borrowing of new Loans of a single Type pursuant to Section 2.2 or a
Continuation or Conversion of existing Loans into a single Type (and, in the
case of LIBOR Loans, with the same Interest Period) pursuant to Section 2.3 or
the acceptance or purchase by Canadian Lenders of Bankers’ Acceptances issued
by Canadian Working Capital Borrower under Section 2.16.

 

“Borrowing
Notice” means a written or telephonic request, or a written confirmation,
made by a Borrower which meets the requirements of Section 2.2.

 

“Business
Day” means: (i) with respect to Canadian Obligations a Canadian Business
Day, and (ii) with respect to all other Obligations, a US Business Day.

 

“Canadian
Administrative Agent” means The Bank of Nova Scotia.

 

“Canadian
Advances” has the meaning given to such term in Section 2.1(c).

 

“Canadian
Borrower” means PMC (Nova Scotia) Company, a Nova Scotia unlimited
liability company.

 

“Canadian
Business Day” means any day, other than a Saturday, Sunday or day which
shall be in the Provinces of Ontario, Quebec or Alberta a legal holiday or day
on which banking institutions are required or authorized to close.

 

“Canadian
Commitment “ means $170,000,000, as such Canadian Commitment may be
increased from time to time pursuant to Section 2.1(d) or reduced from time to
time pursuant to Section 2.5(b)(iv). 
Each US Lender’s Canadian Commitment shall be the amount set forth on
the Lender Schedule, as such US Lender’s Canadian Commitment may be increased
from time to time pursuant to Section 2.1(d).

 

“Canadian
Commitment Fee Rate” means, on any day, the rate per annum set forth on the
Pricing Grid as the “Canadian Commitment Fee Rate” based on the Applicable
Rating Level on

 

4

 

such date.  Changes in the
applicable Canadian Commitment Fee Rate will occur automatically without prior
notice as changes in the Applicable Rating Level occur.  Administrative Agent will give notice
promptly to Canadian Borrower and US Lenders of any change (and its effective
date) in the Applicable Rating Level and the applicable Canadian Commitment Fee
Rate.

 

“Canadian
Commitment Period” means the period from and including the date hereof
until the Canadian Conversion Date (or, if earlier, the day on which the
obligations of US Lenders to make US Loans to Canadian Borrower hereunder
pursuant to Section 2.1(b) and the obligation of US LC Issuer to issue US
Letters of Credit at the request of Canadian Borrower pursuant to Section 2.11
has been terminated or the day on which any of the Canadian Notes first becomes
due and payable in full).

 

“Canadian
Conversion Date” means November 20, 2004, or such later day to which the
Canadian Conversion Date is extended pursuant to Section 2.6.

 

“Canadian
Dollars” and “C$” means the lawful currency of Canada.

 

“Canadian
Facility Usage” means, at the time in question, the aggregate amount of
US Loans to Canadian Borrower pursuant to Section 2.1(b) and US LC
Obligations with respect to US Letters of Credit issued at the request of
Canadian Borrower pursuant to Section 2.11 outstanding at such time.

 

“Canadian
LC Issuer” means The Bank of Nova Scotia in its capacity as the issuer of
Canadian Letters of Credit hereunder, and its successors in such capacity.  Canadian Administrative Agent may, with the
consent of Canadian Working Capital Borrower and the Canadian Lender in question,
appoint any Canadian Lender hereunder as a Canadian LC Issuer in place of or in
addition to The Bank of Nova Scotia.

 

“Canadian
LC Obligations” means, at the time in question, the sum of all Matured
Canadian LC Obligations plus the maximum amounts which Canadian LC Issuer might
then or thereafter be called upon to advance under all Canadian Letters of
Credit then outstanding.

 

“Canadian
Lenders” means each signatory hereto designated as a Canadian Lender, and
the successors and permitted assigns of each such party as holder of a Canadian
Working Capital Note.

 

“Canadian
Lender Parties” means Canadian Administrative Agent, Canadian LC Issuer,
and Canadian Lenders.

 

“Canadian
Letter of Credit” means any letter of credit issued by Canadian LC Issuer
hereunder at the application of Canadian Working Capital Borrower pursuant to
Section 2.11.

 

“Canadian
Letter of Credit Fee Rate” means, on any day, the rate per annum set forth
on the Pricing Grid as the “Canadian LC Fee Rate” based on the Applicable
Rating Level on such date.  Changes in
the applicable Canadian Letter of Credit Fee Rate will occur automatically
without prior notice as changes in the Applicable Rating Level occur.  Administrative Agent will give notice
promptly to Canadian Administrative Agent of any change (and its effective
date) in the Applicable Rating Level, and Canadian Administrative Agent will in
turn give notice

 

5

 

promptly to Canadian Working Capital Borrower and Canadian Lenders of
such change in the Applicable Rating Level and the applicable Canadian Letter
of Credit Fee Rate.

 

“Canadian
Loans” has the meaning given such term in Section 2.1(c) hereof.

 

“Canadian
Notes” has the meaning given such term in Section 2.1(b) hereof.

 

“Canadian
Obligations” means all Liabilities from time to time owing by any
Restricted Person to any Lender Party under or pursuant to any of the Canadian
Advances, Canadian Working Capital Notes and Canadian Letters of Credit,
including all Canadian LC Obligations owing thereunder, or under or pursuant to
any guaranty of the obligations of Canadian Working Capital Borrower under the
Loan Documents.  “Canadian Obligation”
means any part of the Canadian Obligations.

 

“Canadian
Prime Rate” means on any day a fluctuating rate of interest per annum equal
to the higher of (i) the rate of interest per annum most recently
announced by Canadian Administrative Agent as its reference rate for Canadian
Dollar commercial demand loans made to a Person in Canada; and
(ii) Canadian Administrative Agent’s discount rate for Bankers’
Acceptances having a maturity of one month plus one-half percent (0.5%) per
annum. Changes in the Canadian Prime Rate resulting from changes in the
foregoing described reference rate or discount rate shall take place
immediately without notice or demand of any kind.

 

“Canadian
Prime Rate Loan” means a Canadian Loan which bears interest at a rate based
upon the Canadian Prime Rate.

 

“Canadian
Term Loan” has the meaning given it in Section 2.7.

 

“Canadian
Term Loan Maturity Date” means the date which is five years and one day
after the Canadian Conversion Date.

 

“Canadian
US Dollar Base Rate” means for a day, the rate per annum equal to the
higher of (a) the Federal Funds Rate for such day plus one-half of one percent
(0.5%) and (b) the rate of interest per annum most recently established by
Canadian Administrative Agent as its reference rate for US Dollar commercial
loans made to a Person in Canada.  Any
change in the Canadian US Dollar Base Rate due to a change in the Canadian
Administrative Agent’s reference rate shall be effective on the effective date
of such change.

 

“Canadian
Working Capital Borrower” means Plains Marketing Canada, L.P., an Alberta
limited partnership.

 

“Canadian
Working Capital Commitment” means the Dollar Equivalent of $30,000,000, as
such Canadian Working Capital Commitment may be increased from time to time
pursuant to Section 2.1(d) or reduced from time to time pursuant to Section
2.5(b)(iv).  The Dollar Equivalent of
each Canadian Lender’s Canadian Working Capital Commitment shall be the amount
set forth on the Lender Schedule, as such Canadian Lender’s Working Capital
Commitment may be increased from time to time pursuant to Section 2.1(d).

 

6

 

“Canadian Working Capital Commitment Fee
Rate” means, on any day, the rate per annum set forth on the Pricing Grid
as the “Canadian Working Capital Commitment Fee Rate” based on the Applicable
Rating Level on such date.  Changes in
the applicable Canadian Working Capital Commitment Fee Rate will occur
automatically without prior notice as changes in the Applicable Rating Level
occur.  Administrative Agent will give
notice promptly to Canadian Administrative Agent of any change (and its
effective date) in the Applicable Rating Level, and Canadian Administrative
Agent will in turn give notice promptly to Canadian Working Capital Borrower
and Canadian Lenders of such change in the Applicable Rating Level and the
applicable Canadian Working Capital Commitment Fee Rate.

 

“Canadian
Working Capital Commitment Period” means the period from and including the
date hereof until the Canadian Working Capital Maturity Date (or, if earlier,
the day on which the obligation of Canadian Lenders to make Canadian Advances
hereunder and the obligation of Canadian LC Issuer to issue Canadian Letters of
Credit hereunder has been terminated or the day on which any of the Canadian
Working Capital Notes first becomes due and payable in full).

 

“Canadian
Working Capital Facility Usage” means, at the time in question, the Dollar
Equivalent of the aggregate amount of Canadian Advances to Canadian Working
Capital Borrower pursuant to Section 2.1(c) and Canadian LC Obligations.

 

“Canadian
Working Capital Maturity Date” means November 21, 2007.

 

“Canadian
Working Capital Notes” has the meaning given such term in Section 2.1(c)
hereof.

 

“Capital
Lease” means a lease with respect to which the lessee is required
concurrently to recognize the acquisition of an asset and the incurrence of a
liability in accordance with GAAP.

 

“Capital
Lease Obligation” means, with respect to any Person and a Capital Lease,
the amount of the obligation of such Person as the lessee under such Capital
Lease which would, in accordance with GAAP, appear as a liability on a balance
sheet of such Person.

 

“Cash and
Carry Purchases” means purchases of Petroleum Products for physical storage
or in storage or in transit in pipelines which has been hedged by either a
NYMEX contract, an OTC contract or a contract for physical delivery.

 

“Cash
Equivalents” means Investments in:

 

(a)  marketable obligations, maturing within 12
months after acquisition thereof, issued or unconditionally guaranteed by the
United States of America or the federal government of Canada or an
instrumentality or agency thereof and entitled to the full faith and credit of
the United States of America or the federal government of Canada, as the case
may be;

 

(b)  demand deposits and time deposits (including
certificates of deposit) maturing within 12 months from the date of deposit
thereof, (i) with any office of any Lender or (ii) with a domestic office
of any national, state or provincial bank or trust company which is organized
under the Laws of the United States of America or any state therein, or the
federal government of Canada or any province therein, which has capital,
surplus and undivided profits of at least

 

7

 

$500,000,000, and whose long term certificates of deposit are rated at
least Aa3 by Moody’s or AA- by S&P;

 

(c)  repurchase obligations with a term of not
more than seven days for underlying securities of the types described in
subsection (a) above entered into with (i) any Lender or (ii) any other
commercial bank meeting the specifications of subsection (b) above;

 

(d)  open market commercial paper, maturing
within 270 days after acquisition thereof, which are rated at least P-1 by
Moody’s or A-1 by S&P; and

 

(e)  money market or other mutual funds
substantially all of whose assets comprise securities of the types described in
subsections (a) through (d) above.

 

“Change of
Control” means the occurrence of any of the following events:

 

(i)                                     Qualifying
Directors cease for any reason to constitute collectively a majority of the
members of the board of directors of GP LLC (the “Board”) then in office;

 

(ii)                                  GP
LLC shall cease to be, directly or indirectly, the sole legal and beneficial
owner (within the meaning of Rule 13d-3 under the Securities Exchange Act of
1934, as amended) of all of the general partner interests (including all
securities which are convertible into general partner interests) of General
Partner.

 

(iii)                             General
Partner shall cease to be, directly or indirectly, the sole legal and
beneficial owner (as defined above) of all of the general partner interests
(including all securities which are convertible into general partner interests)
of US Borrower; or

 

(iv)                            Neither
General Partner nor US Borrower shall continue to be, directly or indirectly,
the sole legal and beneficial owner of the general partner interest in Plains
Marketing and All American; or

 

(v)                               US
Borrower shall cease to own, directly or indirectly, all of the outstanding
partnership or equity interests in Canadian Borrower and Canadian Working
Capital Borrower, if after giving effect thereto, such Canadian Borrower or
Canadian Working Capital Borrower has any outstanding Obligations or any Lender
shall have any outstanding Commitment thereto.

 

As used herein, “Qualifying
Director” means (i) any Person designated by any Qualifying Owner as its
representative on the Board, (ii) so long as Qualifying Owners own a majority
of the ownership interests of GP LLC entitling the holders thereof to vote in
elections for directors of GP LLC, any Person elected by a majority of such
owners of GP LLC entitled to vote thereon, and (iii) the chief executive
officer of GP LLC, and “Qualifying Owner” means Plains Resources Inc.,
Kayne Anderson Investment Management, EnCap Investments LLC, Sable Minerals, or
any Affiliate of any of the foregoing.

 

“Co-Agent”
shall have the meaning given that term in Section 9.10.

 

“Code”
means the Internal Revenue Code of 1986, as amended from time to time, together
with all rules and regulations promulgated with respect thereto.

 

8

 

“Commitment” means the sum of (a) the
Canadian Commitment, plus (b) the US Commitment, plus (c) the Canadian Working
Capital Commitment, in each case as of the time of determination.

 

“Companies’
Creditors Arrangement Act (Canada)” means the Companies’ Creditors Arrangement Act, R.S.C. 1985, c. C-36,
including the regulations made and from time to time in force under that Act.

 

“Consolidated”
refers to the consolidation of any Person, in accordance with GAAP, with its
properly consolidated subsidiaries. 
References herein to a Person’s Consolidated financial statements,
financial position, financial condition, liabilities, etc. refer to the
consolidated financial statements, financial position, financial condition,
liabilities, etc. of such Person and its properly consolidated subsidiaries.

 

“Consolidated
EBITDA” means, for any period, the sum of (1) the Consolidated Net Income
during such period, plus (2) all interest expense that was deducted in
determining such Consolidated Net Income for such period, plus (3) all income
taxes (including any franchise taxes to the extent based upon net income) that
were deducted in determining such Consolidated Net Income, plus (4) all
depreciation, amortization (including amortization of good will and debt issue
costs) and other non-cash charges (including any provision for the reduction in
the carrying value of assets recorded in accordance with GAAP) which were
deducted in determining such Consolidated Net Income, plus (5) up to
$20,000,000 of any cash payments and related payroll taxes made by US Borrower
prior to June 30, 2004 pursuant to the Plains All American GP LLC 1998
Long-Term Incentive Plan as in effect on the date hereof in lieu of delivery of
units due certain holders of such Long-Term Incentive Plan, minus (6)
all non-cash items of income which were included in determining such
Consolidated Net Income.

 

“Consolidated
Funded Indebtedness” means as of any date, the sum of the following
(without duplication):  (i) the
outstanding principal amount of all Indebtedness which is classified as
“long-term indebtedness” on a consolidated balance sheet of US Borrower and its
Consolidated Subsidiaries (excluding Unrestricted Subsidiaries) prepared as of
such date in accordance with GAAP (subject to year-end audit adjustments with respect
to non-year end periods) and any current maturities and other principal amount
in respect of such Indebtedness due within one year but which was classified as
“long-term indebtedness” at the creation thereof; (ii) the outstanding
principal amount of Indebtedness for borrowed money of US Borrower and its
Consolidated Subsidiaries (excluding Unrestricted Subsidiaries) outstanding
under a revolving credit, term or similar agreement (and renewals and
extensions thereof); and (iii) the outstanding principal amount of Indebtedness
in respect of Capital Leases of US Borrower and its Consolidated Subsidiaries
(excluding Unrestricted Subsidiaries); provided, however,
Consolidated Funded Indebtedness shall not, if otherwise applicable, include
(x) Indebtedness in respect of letters of credit, (y) Indebtedness incurred to
finance Cash and Carry Purchases or (z) margin deposits.

 

“Consolidated
Net Income” means, for any period, US Borrower’s and its Subsidiaries’
(excluding Unrestricted Subsidiaries) gross revenues for such period, including
any cash dividends or distributions actually received from any other Person
during such period, minus US Borrower’s and its Subsidiaries’ (excluding
Unrestricted Subsidiaries) expenses and other proper

 

9

 

charges against income (including taxes on income, to the extent
imposed), determined on a Consolidated basis after eliminating earnings or
losses attributable to outstanding minority interests and excluding the net
earnings of any Person other than a Subsidiary in which US Borrower or any of
its Subsidiaries (excluding Unrestricted Subsidiaries) has an ownership
interest.  Consolidated Net Income shall
not include (i) any gain or loss from the sale of assets, (ii) any extraordinary
gains or losses, or (iii) any non-cash gains or losses resulting from mark to
market activity as a result of the implementation of SFAS 133 or EITF
98-10.  In addition, Consolidated Net
Income shall not include the cost or proceeds of purchasing or selling options
which are used to hedge future activity, until the period in which such hedged
future activity occurs.

 

“Consolidated
Tangible Net Worth” means the remainder of (i) all Consolidated assets, as
determined in accordance with GAAP, of US Borrower and its Subsidiaries
(excluding Unrestricted Subsidiaries) minus (ii) the sum of (a) US
Borrower’s Consolidated liabilities, as determined in accordance with GAAP, (b)
the book value of any equity interests in any of US Borrower’s Subsidiaries
(excluding Unrestricted Subsidiaries) which equity interests are owned by a
Person other than US Borrower or a Wholly Owned Subsidiary of US Borrower; and
(c) the net book value of all assets that would be treated as intangible under
GAAP, including goodwill, trademarks, trade names and service marks.  The effect of any increase or decrease of
net worth in any period as a result of items of income or loss not reflected in
the determination of net income but reflected in the determination of
comprehensive income (to the extent provided under GAAP as in effect on the
date hereof) shall be excluded in determining Consolidated Tangible Net Worth.

 

“Contango
Credit Agreement” means that certain Uncommitted Senior Secured
Discretionary Contango Facility Credit Agreement of even date herewith among
Plains Marketing, Fleet National Bank, as administrative agent, and the lenders
named therein.

 

“Continue”,
“Continuation” and “Continued” shall refer to (i) the
continuation pursuant to Section 2.3 of a LIBOR Loan as a LIBOR Loan from one
Interest Period to the next Interest Period and (ii) a rollover of a Banker’s
Acceptance at maturity.

 

“Continuation/Conversion
Notice” means a written or telephonic request, or a written confirmation,
made by a Borrower which meets the requirements of Section 2.3.

 

“Convert,
“Conversion” and “Convert” refers to a conversion pursuant to
Section 2.3 of one Type of US Loan into another Type of US Loan, or of one
Type of Canadian Advance into another Type of Canadian Advance.

 

“Debt
Coverage Ratio” shall have the meaning given that term in Section 7.8.

 

“Default”
means any Event of Default and any default, event or condition which would,
with the giving of any requisite notices and the passage of any requisite
periods of time, constitute an Event of Default.

 

“Default
Rate” means, at the time in question, two percent (2%) per annum plus:

 

10

 

(a)  the LIBOR Rate plus  the Applicable Margin then in effect for
each LIBOR Loan (up to the end of the applicable Interest Period),

 

(b)  the Base Rate plus the
Applicable Margin then in effect for each Base Rate Loan,

 

(c)  the Canadian Prime Rate
plus the Applicable Margin for each Canadian Prime Rate Loan, or

 

(d)  the Canadian US Dollar Base
Rate plus the Applicable Margin for each Canadian US Dollar Base Rate
Loan;

 

provided, however, the Default
Rate shall never exceed the Highest Lawful Rate.

 

“Default
Rate Period” means (i) any period during which an Event of Default, other
than pursuant to Section 8.1 (a) or (b), is continuing, provided that such
period shall not begin until notice of the commencement of the Default Rate has
been given to the applicable Borrower by Administrative Agent upon the
instruction by Majority Lenders and (ii) any period during which any Event of
Default pursuant to Section 8.1 (a) or (b) is continuing unless such applicable
Borrower has been notified otherwise by Administrative Agent upon the
instruction by Majority Lenders.

 

“Depository
Bills and Notes Act (Canada)” means the Depository
Bills and Notes Act (Canada), R.S.C. 1998, c. 13, including the
regulations made and, from time to time, in force under that Act.

 

“Disclosure
Schedule” means Schedule 2 hereto.

 

“Discount
Proceeds” means, in respect of each Bankers’ Acceptance, funds in an amount
which is equal to:

 

	
   

  	
  Face Amount

  	
   

  
	
   

  	
  1 + (Rate x Term)

  	
   

  
	
   

  	
  365

  	
   

  

 

(where “Face Amount” is the
principal amount of the Bankers’ Acceptance being purchased, “Rate” is the BA
Discount Rate divided by 100 and “Term” is the number of days in the term of
the Bankers’ Acceptance.)

 

“Distribution”
means (a) any dividend or other distribution (whether in cash or other
property, but excluding dividends or other distributions payable in equity
interests in US Borrower) with respect to any equity interest of US Borrower,
(b) any payment (whether in cash or other property, but excluding dividends or
other distributions payable in equity interests in US Borrower), including any
sinking fund or similar deposit, on account of the retirement, redemption,
purchase, cancellation, termination or other acquisition for value of any
equity interest of US Borrower or (c) any other payment by US Borrower to any
holder of equity interests of US Borrower with respect to such equity interests
held thereby other than payments made with equity interests in US Borrower.

 

11

 

“Dollar Equivalent” of any amount of
any currency at any date means (i) if such currency is Dollars, the amount of
such currency, or (ii) if such currency is Canadian Dollars, the equivalent in
Dollars of such amount of such currency based upon the rate of exchange for
such conversion as quoted by the Bank of Canada at approximately 12:00 noon,
Toronto time (or, if not so quoted, the spot rate of exchange quoted for
wholesale transactions made by Administrative Agent) on the date on or as of
which such amount is to be determined.

 

“Dollars”
and “$” means the lawful currency of the United States of America,
except where otherwise specified.

 

“Eligible
Transferee” means a Person which either (a) is a Lender, or
(b) is consented to as an Eligible Transferee by Administrative Agent
(and, as to the Canadian Working Capital Commitment, Canadian Administrative
Agent) and, so long as no Default or Event of Default is continuing, by the
relevant Borrower, which consents in each case will not be unreasonably
withheld; provided no Person organized outside the United States may be
an Eligible Transferee with respect to any US Obligations if US Borrower or
Canadian Borrower (or, prior to the effectiveness of any such transfer, US
Borrower notifies the Administrative Agent that any other Restricted Person)
would be required to pay withholding taxes on interest or principal owed to
such Person; provided  further, no Person organized outside Canada
may be an Eligible Transferee with respect to any Canadian Obligations if
Canadian Working Capital Borrower (or, prior to the effectiveness of any such
transfer, US Borrower notifies the Canadian Administrative Agent that any other
Restricted Person) would be required to pay withholding taxes on interest or
principal owed to such Person.

 

“Environmental
Laws” means any and all Laws relating to the environment or to emissions,
discharges, releases or threatened releases of pollutants, contaminants,
chemicals, or industrial, toxic or hazardous substances or wastes into the
environment including ambient air, surface water, ground water, or land, or
otherwise relating to the manufacture, processing, distribution, use,
treatment, storage, disposal, transport, or handling of pollutants,
contaminants, chemicals, or industrial, toxic or hazardous substances or
wastes.

 

“ERISA”
means the Employee Retirement Income Security Act of 1974, as amended from time
to time, together with all rules and regulations promulgated with respect
thereto.

 

“ERISA
Affiliate” means each Restricted Person and all members of a controlled
group of corporations and all trades or businesses (whether or not
incorporated) under common control that, together with such Restricted Person,
are treated as a single employer under Section 414 of the Code.

 

“ERISA Plan”
means any employee pension benefit plan subject to Title IV of ERISA maintained
by any ERISA Affiliate with respect to which any Restricted Person has a fixed
or contingent liability.

 

“Event of
Default” has the meaning given to such term in Section 8.1.

 

“Existing
Agreements” means (i) that certain Second Amended and Restated Credit
Agreement [Revolving Credit Facility] dated July 2, 2002 among Plains Marketing
and certain Affiliates, Fleet National Bank, as administrative agent, and the
agents and lenders named

 

12

 

therein, and (ii) that certain Second Amended and Restated Credit
Agreement [Letter of Credit and Hedged Inventory Facility] dated July 2, 2003
among Plains Marketing and certain Affiliates, Fleet National Bank, as
administrative agent, and the agents and lenders named therein.

 

“Federal
Funds Rate” means, for any day, the rate per annum (rounded upwards, if
necessary, to the nearest 1/1000th of one percent) equal to the weighted
average of the rates on overnight Federal funds transactions with members of
the Federal Reserve System arranged by Federal funds brokers on such day, as
published by the Federal Reserve Bank of New York on the Business Day next
succeeding such day, provided that (i) if the day for which such rate is to be
determined is not a Business Day, the Federal Funds Rate for such day shall be
such rate on such transactions on the next preceding Business Day as so
published on the next succeeding Business Day, and (ii) if such rate is not so
published for any day, the Federal Funds Rate for such day shall be the average
rate quoted to Administrative Agent on such day on such transactions as
determined by Administrative Agent.

 

“Fiscal
Quarter” means a three-month period ending on March 31, June 30, September
30 or December 31 of any year.

 

“Fiscal
Year” means a twelve-month period ending on December 31 of any year.

 

“GAAP”
means those generally accepted accounting principles and practices which are
recognized as such by the Financial Accounting Standards Board (or any
generally recognized successor) and which, in the case of US Borrower and its
Consolidated Subsidiaries, are applied for all periods after the date hereof in
a manner consistent with the manner in which such principles and practices were
applied to the Initial Financial Statements. 
If any change in any accounting principle or practice is required by the
Financial Accounting Standards Board (or any such successor) in order for such
principle or practice to continue as a generally accepted accounting principle
or practice, all reports and financial statements required hereunder with
respect to US Borrower or with respect to US Borrower and its Consolidated
Subsidiaries may be prepared in accordance with such change, but all
calculations and determinations to be made hereunder may be made in accordance
with such change only after notice of such change is given to each Lender and
Majority Lenders agree to such change insofar as it affects the accounting of
US Borrower or of US Borrower and its Consolidated Subsidiaries.

 

“General
Partner” means Plains AAP, L.P., a Delaware limited partnership, in its
capacity as the sole general partner of US Borrower.

 

“GP LLC”
means Plains All American GP LLC, a Delaware limited liability company.

 

“Guarantors”
means, as of the date hereof, US Borrower and all of its Subsidiaries, other
than 3794865 Canada Ltd., Plains LPG Services GP LLC, Plains LPG Services, L.P.
and Atchafalaya Pipeline, L.L.C. (excluding US Borrower with respect to the US
Commitment, Canadian Borrower with respect to the Canadian Commitment, and
Canadian Working Capital Borrower with respect to the Canadian Working Capital
Commitment) and any other Person who has guaranteed some or all of the
Obligations and who has been accepted by Administrative Agent as a Guarantor or
any Subsidiary of US Borrower which now or hereafter executes and delivers a
guaranty to Administrative Agent pursuant to Section 6.9.

 

13

 

“Hazardous
Materials” means any substances regulated under any Environmental Law,
whether as pollutants, contaminants, or chemicals, or as industrial, toxic or
hazardous substances or wastes, or otherwise.

 

“Highest
Lawful Rate” means, with respect to each Lender Party to whom Obligations
are owed, the maximum nonusurious rate of interest that such Lender Party is
permitted under applicable Law to contract for, take, charge, or receive with
respect to such Obligations.  All
determinations herein of the Highest Lawful Rate, or of any interest rate
determined by reference to the Highest Lawful Rate, shall be made separately
for each Lender Party as appropriate to assure that the Loan Documents are not
construed to obligate any Person to pay interest to any Lender Party at a rate
in excess of the Highest Lawful Rate applicable to such Lender Party.

 

“Income Tax
Act (Canada)” means the Income Tax Act,
R.S.C. 1985 c. 1 (fifth supplement), including the regulations made and, from
time to time, in force under that Act.

 

“Indebtedness”
of any Person means each of the following:

 

(a)  its obligations for the repayment of
borrowed money,

 

(b)  its obligations to pay the deferred purchase
price of property or services (excluding trade account payables arising in the
ordinary course of business), other than contingent purchase price or similar
obligations incurred in connection with an acquisition and not yet earned or
determinable,

 

(c)  its obligations evidenced by a bond,
debenture, note or similar instrument,

 

(d)  its obligations, as lessee, constituting
principal under Capital Leases,

 

(e)  its direct or contingent reimbursement
obligations with respect to the face amount of letters of credit pursuant to the
applications or reimbursement agreements therefor,

 

(f)  its obligations for the repayment of
outstanding banker’s acceptances, whether matured or unmatured,

 

(g)  its obligations under any synthetic lease,
tax retention operating lease, off-balance sheet loan or similar off-balance
sheet financing if the obligation under such synthetic lease, tax retention
operating lease, off-balance sheet loan or similar off-balance sheet financing
is considered indebtedness for borrowed money for tax purposes but is
classified as an operating lease in accordance with GAAP (excluding, to the
extent included herein, operating leases entered into in the ordinary course of
business), or

 

(h)  its obligations under guaranties of any
obligations of any other Person described in the foregoing clauses (a) through
(g).

 

“Initial
Financial Statements” means (i) the audited Consolidated financial
statements of US Borrower as of December 31, 2002, and (ii) the unaudited
consolidating balance sheet and income statement of US Borrower as of September
30, 2003.

 

14

 

“Interest
Act (Canada)” means the Interest Act,
R.S.C. 1985, c. I-15, including the regulations made and, from time to time, in
force under that Act.

 

“Interest
Expense” means, with respect to any period, the sum (without duplication)
of the following (in each case, eliminating all offsetting debits and credits
between US Borrower and its Subsidiaries (excluding Unrestricted Subsidiaries)
and all other items required to be eliminated in the course of the preparation
of Consolidated financial statements of US Borrower and its Subsidiaries
(excluding Unrestricted Subsidiaries) in accordance with GAAP): (a) all
interest and commitment fees in respect of Indebtedness of US Borrower or any
of its Subsidiaries (excluding Unrestricted Subsidiaries) (including imputed
interest on Capital Lease Obligations) which are accrued during such period and
whether expensed in such period or capitalized; plus (b) all fees in respect of
letters of credit issued for the account of US Borrower or any of its
Subsidiaries, which are accrued during such period and whether expensed in such
period or capitalized.

 

“Interest
Payment Date” means (a) with respect to each Base Rate Loan, the last
day of each March, June, September and December beginning December 31, 2003,
and (b) with respect to each LIBOR Loan, the last day of the Interest Period
that is applicable thereto and, if such Interest Period is six, or twelve
months in length, the dates specified by Administrative Agent or Canadian
Administrative Agent, as applicable, which are approximately three, six, and
nine months (as appropriate) after such Interest Period begins; provided that
the last Business Day of each calendar month shall also be an Interest Payment
Date for each such Loan so long as any Event of Default exists under Section
8.1 (a) or (b).

 

“Interest
Period” means, with respect to each particular LIBOR Loan in a Borrowing,
the period specified in the Borrowing Notice or Continuation/Conversion Notice
applicable thereto, beginning on and including the date specified in such
Borrowing Notice or Continuation/Conversion Notice (which must be a Business
Day), and ending one, two, three, six or twelve months (if twelve months is
available for each Lender) thereafter (and, as to US Loans, ending on a date
less than 30 days thereafter as may be specified by US Borrower or Canadian
Borrower, if such lesser period is available for each US Lender), as US
Borrower or Canadian Borrower may elect in such notice; provided that:  (a) any Interest Period which would
otherwise end on a day which is not a Business Day shall be extended to the
next succeeding Business Day unless such Business Day falls in another calendar
month, in which case such Interest Period shall end on the next preceding
Business Day; (b) any Interest Period which begins on the last Business Day in
a calendar month (or on a day for which there is no numerically corresponding
day in the calendar month at the end of such Interest Period) shall end on the
last Business Day in a calendar month; and (c) notwithstanding the foregoing,
no Interest Period may be selected for a US Loan to US Borrower that would end
after the US Maturity Date, or for a US Loan to Canadian Borrower that would
end after the Canadian Conversion Date.

 

“Investment”
means any investment made, directly or indirectly in any Person, whether by
acquisition of shares of capital stock, indebtedness or other obligations or
securities or by loan, advance, capital contribution or otherwise, and whether
made in cash, by the transfer of property or by any other means.

 

“Judgment
Interest Act (Alberta)” means the Judgment
Interest Act, S.A. 1984 c. J-O.5, including the regulations made
and, from time to time, in force under that Act.

 

15

 

“Law”
means any statute, law, regulation, ordinance, rule, treaty, judgment, order,
decree, permit, concession, franchise, license, agreement or other governmental
restriction of the United States or Canada or any state, province, or political
subdivision thereof or of any foreign country or any department, state,
province or other political subdivision thereof.

 

“LC
Application” means any application for (i) a US Letter of Credit hereafter
made by US Borrower or Canadian Borrower 
to US LC Issuer, or (ii) a Canadian Letter of Credit hereafter made by
Canadian Working Capital Borrower to Canadian LC Issuer.

 

“LC Issuer”
means: (i) with respect to US Letters of Credit, US LC Issuer, (ii) with
respect to Canadian Letters of Credit, Canadian LC Issuer, and (iii) their
respective successors in such capacity.

 

“LC
Obligations” means: (i) with respect to US Lenders, US LC Obligations, and
(ii) with respect to Canadian Lenders, Canadian LC Obligations.

 

“Lender Commitment”
means, with respect to a Lender, the sum of (a) the greater of (i) such
Lender’s US Commitment and (ii) such Lender’s Percentage Share of the US
Facility Usage, plus (b) the greater of (i) such Lender’s Canadian
Commitment and (ii) such Lender’s Percentage Share of the Canadian Facility
Usage, plus (c) the greater of (i) such Lender’s Canadian Working
Capital Commitment, and (ii) such Lender’s Percentage Share of the Canadian
Working Capital Facility Usage, in each case as of the time of determination.

 

“Lender
Parties” means all Agents, all LC Issuers and all Lenders.

 

“Lenders”
means (i) with respect to US Loans, US Lenders, (ii) with respect to Canadian
Loans, Canadian Lenders, and (iii) collectively, US Lenders and Canadian
Lenders.

 

“Lender Schedule”
means Schedule 1 hereto.

 

“Letter of
Credit” means a US Letter of Credit or a Canadian Letter of Credit.

 

“Liabilities”
means, as to any Person, all indebtedness, liabilities and obligations of such
Person, whether matured or unmatured, liquidated or unliquidated, primary or
secondary, direct or indirect, absolute, fixed or contingent, and whether or
not required to be considered pursuant to GAAP.

 

“LIBOR Loan”
means a US Loan that bears interest at a rate based upon the LIBOR Rate.

 

“LIBOR Rate”
means, as applicable to any LIBOR Loan within a Borrowing and with respect to
the related Interest Period therefor, the rate per annum (rounded upwards, if
necessary, to the nearest 1/100 of 1%) as determined on the basis of offered
rates for deposits in Dollars, for a period of time comparable to such Interest
Period which appears on Telerate Page 3750 (or any successor page) as of 11:00
a.m. London time on the day that is two Business Days preceding the first day
of such LIBOR Loan; provided, however, if the rate described above does not
appear on the Telerate system on any applicable interest determination date,
the LIBOR Rate shall be the rate (rounded upwards as described above, if
necessary) for deposits in dollars for a period

 

16

 

substantially equal to such Interest Period on the Reuters Page “LIBOR”
(or such other page as may replace the LIBOR Page on that service for the
purpose of displaying such rates), as of 11:00 a.m. (London time), on the date
that is two Business Days prior to the beginning of such Interest Period;
provided, however, if more than one rate is specified on Reuters Screen LIBOR
Page, the applicable rate shall be the arithmetic mean of all such rates
(rounded upwards, if necessary, to the nearest 1/1000 of 1%).  If both the Telerate and Reuters system are
unavailable, then the LIBOR Rate for that date will be determined on the basis
of the offered rates for deposits in Dollars for a period of time comparable to
such Interest Period which are offered by four major banks in the London
interbank market at approximately 11:00 a.m. London time, on the day that is
two (2) Business Days preceding the first day of such LIBOR Loan as selected by
Administrative Agent.  The principal
London office of each of the four major London banks will be requested to
provide a quotation of its Dollar deposit offered rate.  If at least two such quotations are
provided, the rate for that date will be the arithmetic mean of the
quotations.  If fewer than two quotations
are provided as requested, the rate for that date will be determined on the
basis of the rates quoted for loans in Dollars to leading European banks for a
period of time comparable to such Interest Period offered by major banks in New
York City at approximately 11:00 a.m. New York City time, on the day that is
two Business Days preceding the first day of such LIBOR Loan.  In the event that Administrative Agent is
unable to obtain any such quotation as provided above, it will be deemed that
the LIBOR Rate pursuant to such LIBOR Loan cannot be determined.  In the event that the Board of Governors of
the Federal Reserve System shall impose a Reserve Percentage with respect to
LIBOR deposits of any Lender, then for any period during which such Reserve Percentage
shall apply, the LIBOR Rate shall be equal to the amount determined above
divided by an amount equal to 1 minus the Reserve Percentage.  “Reserve Percentage” means the maximum
aggregate reserve requirement (including all basic, supplemental, marginal,
special, emergency and other reserves) which is imposed on member banks of the
Federal Reserve System against “Euro-currency Liabilities” as defined in
Regulation D.  Without limiting the
effect of the foregoing, the Reserve Percentage shall reflect any other
reserves required to be maintained by such member banks with respect to (a) any
category of liabilities which includes deposits by reference to which the LIBOR
Rate is to be determined, or (b) any category of extensions of credit or other
assets which include LIBOR Loans.  The
LIBOR Rate for any LIBOR Loan shall change whenever the Reserve Percentage
changes.

 

“Lien”
means, with respect to any property or assets, any right or interest therein of
a creditor to secure Liabilities owed to it or any other arrangement with such
creditor which provides for the payment of such Liabilities out of such
property or assets or which allows such creditor to have such Liabilities
satisfied out of such property or assets prior to the general creditors of any
owner thereof, including any lien, mortgage, security interest, pledge,
deposit, production payment, rights of a vendor under any title retention or
conditional sale agreement or lease substantially equivalent thereto, tax lien,
mechanic’s or materialman’s lien, or any other charge or encumbrance for
security purposes, whether arising by Law or agreement or otherwise, but
excluding any right of offset which arises without agreement in the ordinary
course of business.  “Lien” also means
any filed financing statement, any registration of a pledge (such as with an
issuer of uncertificated securities), or any other arrangement or action which
would serve to perfect a Lien described in the preceding sentence, regardless
of whether such financing statement is filed, such registration is made, or
such arrangement or action is undertaken before or after such Lien exists.

 

17

 

“Loan
Documents” means this Agreement, the Notes, the Letters of Credit, the LC
Applications, the BAs, and all other agreements, certificates, documents,
instruments and writings at any time delivered in connection herewith or
therewith (exclusive of term sheets and commitment letters).

 

“Loans”
means, collectively, the US Loans and the Canadian Loans.

 

“Majority
Lenders” means Lenders whose Aggregate Percentage Shares equal or exceed
fifty-one percent (51%).

 

“Material
Adverse Change” means a material and adverse change, from the state of
affairs presented in the Initial Financial Statements or as represented or
warranted in any Loan Document, to (a) US Borrower’s Consolidated financial
condition, (b) US Borrower’s Consolidated operations, properties or prospects,
considered as a whole, (c) US Borrower’s, Canadian Borrower’s, or Canadian
Working Capital Borrower’s ability to timely pay its Obligations, or (d) the
enforceability of the material terms of any Loan Document.

 

“Matured
Canadian LC Obligations” means all amounts paid by Canadian LC Issuer on
drafts or demands for payment drawn or made under or purported to be under any
Canadian Letter of Credit and all other amounts due and owing to Canadian LC
Issuer under any LC Application for any such Canadian Letter of Credit, to the
extent the same have not been repaid to Canadian LC Issuer (with the proceeds
of Canadian Loans or otherwise).

 

“Matured US
LC Obligations” means all amounts paid by US LC Issuer on drafts or demands
for payment drawn or made under or purported to be under any US Letter of
Credit and all other amounts due and owing to US LC Issuer under any LC
Application for any such US Letter of Credit, to the extent the same have not
been repaid to US LC Issuer (with the proceeds of US Loans or otherwise).

 

“Moody’s”
means Moody’s Investor Service, Inc., or its successor.

 

“Net
Proceeds” means with respect to any Bankers’ Acceptance, the Discount
Proceeds less the amount equal to the applicable Stamping Fee Rate multiplied
by the face amount of such Bankers’ Acceptance.

 

“Notes”
means, collectively, the US Notes, the Canadian Notes and the Canadian Working
Capital Notes.

 

“Obligations”
means, collectively, the US Obligations, the Canadian Obligations and all other
Liabilities from time to time owing by any Restricted Person to any Lender
Party under or pursuant to any of the Loan Documents.  “Obligation” means any part of the Obligations.

 

“PAA Debt
Rating” means the rating then in effect by a Rating Agency with respect to
the long term senior unsecured non-credit enhanced debt of US Borrower.

 

“Percentage
Share” means:

 

18

 

(a) with
respect to US Loans to US Borrower and US Lenders, the percentage shown as each
US Lender’s “US Percentage Share” on the Lender Schedule,

 

(b) with
respect to US Loans to Canadian Borrower and US Lenders:

 

(i) prior to the Canadian Conversion Date and prior to any cancellation
of any such US Lender’s Canadian Commitment pursuant to Section 2.6(c)(ii), the
percentage shown as each US Lender’s “Canadian Percentage Share” on the Lender
Schedule,

 

(ii) prior to the Canadian Conversion Date, but following any reduction
of the Canadian Commitment pursuant to Section 2.6(c)(ii): (x) with respect to
US Lenders with a continuing Canadian Commitment, (I) for purposes of
Section 2.1(b), 2.5(b)(ii), 2.12(a) and 2.12(c), a percentage equal to such US
Lender’s Canadian Commitment shown on the Lender Schedule divided by the
aggregate Canadian Commitment following such reduction, and (II) for all other
purposes, a percentage equal to such US Lender’s Canadian Commitment shown on
the Lender Schedule divided by the sum of the aggregate Canadian Commitment plus
the aggregate outstanding principal amount of US Loans to Canadian Borrower by
US Lenders with no continuing Canadian Commitment, and (y) with respect to US
Lenders with no continuing Canadian Commitment, a percentage equal to such US
Lender’s US Loans to Canadian Borrower divided by the sum of the aggregate
Canadian Commitment plus the aggregate outstanding principal amount of US Loans
to Canadian Borrower by US Lenders with no continuing Canadian Commitment, and

 

(iii) on and after the Canadian Conversion Date, as to each US Lender,
a percentage equal to the outstanding principal amount of such US Lender’s US
Loans to Canadian Borrower divided by the aggregate outstanding principal amount
of all US Lenders’ US Loans to Canadian Borrower, and

 

(c) with
respect to Canadian Advances and Canadian Lenders, the percentage shown as each
Canadian Lender’s “Canadian Working Capital Percentage Share” on the Lender
Schedule.

 

“Permitted
Lien” has the meaning given to such term in Section 7.2.

 

“Person”
means an individual, corporation, partnership, limited liability company,
association, joint stock company, trust or trustee thereof, estate or executor
thereof, unincorporated organization or joint venture, Tribunal, or any other
legally recognizable entity.

 

“Petroleum
Products” means crude oil, condensate, natural gas, natural gas liquids
(NGL’s), liquefied petroleum gases (LPG’s), refined petroleum products or any
blend thereof.

 

“Plains
Marketing” means Plains Marketing, L.P., a Delaware limited partnership.

 

“Pricing
Grid” means Schedule 3 attached hereto.

 

“Rating
Agency” means either S&P or Moody’s.

 

19

 

“Regulation
D” means Regulation D of the Board of Governors of the Federal Reserve
System as from time to time in effect.

 

“Restricted
Person” means any of US Borrower and each Subsidiary of US Borrower,
including but not limited to Plains Marketing, All American, Canadian Borrower,
Canadian Working Capital Borrower and each Subsidiary of Plains Marketing, All
American, Canadian Borrower, and Canadian Working Capital Borrower, but
excluding, for the avoidance of doubt, Unrestricted Subsidiaries.

 

“Restriction
Exception” means (i) any applicable Law or any instrument governing
Indebtedness or equity interests, or any applicable Law or any other agreement
relating to any property, assets or operations of a Person whose capital stock
or other equity interests are acquired, in whole or part, by a Restricted
Person pursuant to an acquisition (whether by merger, consolidation,
amalgamation or otherwise), as such instrument or agreement is in effect at the
time of such acquisition (except with respect to Indebtedness incurred in
connection with, or in contemplation of, such acquisition), or such applicable
Law is then or thereafter in effect (as applicable), which is not applicable to
the acquiring Restricted Person, or the property, assets or operations of the
acquiring Restricted Person, other than the acquired Person, or the property,
assets or operations of such acquired Person or such acquired Person’s
Subsidiaries; provided that in the case of Indebtedness, the incurrence
of such Indebtedness is not prohibited hereunder, or (ii) provisions with
respect to the disposition or distribution of assets in joint venture
agreements or other similar agreements entered into in the ordinary course of
business.

 

“S&P”
means Standard & Poor’s Ratings Group (a division of McGraw Hill, Inc.) or
its successor.

 

“Schedule I
BA Reference Banks” means the Lenders listed in Schedule I to the Bank Act (Canada) as are, at such time,
designated by Canadian Administrative Agent, with the prior consent of Canadian
Working Capital Borrower (acting reasonably), as the Schedule I BA Reference
Banks.

 

“Schedule
II BA Reference Banks” means the Lenders listed in Schedule II to the Bank Act (Canada) as are, at such time,
designated by Canadian Administrative Agent, with the prior consent of Canadian
Working Capital Borrower (acting reasonably,) as the Schedule II BA Reference
Banks.

 

“Significant
Restricted Persons” means Borrowers, Plains Marketing, All American and
Subsidiaries of US Borrower that would be a “significant subsidiary” as defined
in Article 1, Rule 1-02 of Regulation S-X, promulgated pursuant to the
Securities Exchange Act of 1934 and the Securities Act of 1933, each as
amended.

 

“Specified
Acquisition” means one or more acquisitions of assets or entities or
operating lines or divisions in any rolling 12-month period for an aggregate
purchase price of not less than $50,000,000.

 

“Specified
Equity Offering” means one or more issuances of equity by US Borrower for
aggregate net cash proceeds of not less than fifty percent (50%) of the
aggregate purchase price of the Specified Acquisition.

 

20

 

“Stamping
Fee Rate” means the rate per annum set forth on the Pricing Grid as the
“Stamping Fee Rate” based on the Applicable Rating Level on such date, provided
that during a Default Rate Period, the Stamping Fee Rate shall be increased by
two percent (2%).  Changes in the
applicable Stamping Fee Rate will occur automatically without prior notice as
changes in the Applicable Rating Level occur and shall be effective with
respect to BA’s issued on and after such change, but shall not apply with
respect to any outstanding BA’s. Administrative Agent will give notice promptly
to Canadian Administrative Agent of any change (and its effective date) in the
Applicable Rating Level, and Canadian Administrative Agent will in turn give
notice promptly to Canadian Working Capital Borrower and Canadian Lenders of
such change in the Applicable Rating Level and the applicable Stamping Fee
Rate.

 

“Subsidiary”
means, with respect to any Person, any corporation, association, partnership,
limited liability company, joint venture, or other business or corporate
entity, enterprise or organization which is directly or indirectly (through one
or more intermediaries) controlled or owned more than fifty percent by such
Person; provided, however, that no Unrestricted Subsidiary shall
be deemed a “Subsidiary” of any Restricted Person for purposes of any Loan
Document except as provided in Section 7.10.

 

“Termination
Event” means (a) the occurrence with respect to any ERISA Plan of (i) a
reportable event described in Sections 4043(c)(5) or (6) of ERISA or (ii) any
other reportable event described in Section 4043(c) of ERISA other than a
reportable event not subject to the provision for 30-day notice to the Pension
Benefit Guaranty Corporation pursuant to a waiver by such corporation under
Section 4043(a) of ERISA, or (b) the withdrawal of any ERISA Affiliate from an
ERISA Plan during a plan year in which it was a “substantial employer” as
defined in Section 4001(a)(2) of ERISA, or (c) the filing of a notice of intent
to terminate any ERISA Plan or the treatment of any ERISA Plan amendment as a
termination under Section 4041 of ERISA, or (d) the institution of proceedings
to terminate any ERISA Plan by the Pension Benefit Guaranty Corporation under
Section 4042 of ERISA, or (e) any other event or condition which might
constitute grounds under Section 4042 of ERISA for the termination of, or the
appointment of a trustee to administer, any ERISA Plan.

 

“364-Day
Credit Agreement” means that certain 364-Day Credit Agreement of even date
herewith among US Borrower, Fleet National Bank, as administrative agent, and
the lenders named therein.

 

“Tribunal”
means any government, any arbitration panel, any court or any governmental department,
commission, board, bureau, agency or instrumentality of the United States of
America, the Dominion of Canada, or any state, province, commonwealth, nation,
territory, possession, county, parish, town, township, village or municipality,
whether now or hereafter constituted or existing.

 

“Type”
means, with respect to any Loans, the characterization of such Loans as Base
Rate Loans, LIBOR Loans, Canadian Prime Rate Loans, Canadian US Dollar Base
Rate Loans, or BAs.

 

“Unrestricted
Subsidiary” shall have the meaning given it in Section 7.10.

 

21

 

“US
Borrower” means Plains All American Pipeline, L.P., a Delaware limited
partnership.

 

“US
Business Day” means any day, other than a Saturday, Sunday or day which
shall be in the Commonwealth of Massachusetts (and, as to US Loans to Canadian
Borrower, in the province of Alberta) a legal holiday or day on which banking
institutions are required or authorized to close.  Any Business Day in any way relating to LIBOR Loans (such as the
day on which an Interest Period begins or ends) must also be a day on which
commercial banks settle payments in London.

 

“US
Commitment” means $425,000,000, as such US Commitment may be increased from
time to time pursuant to Section 2.1(d) or reduced from time to time pursuant
to Section 2.5(b)(iv).  Each US
Lender’s US Commitment shall be the amount set forth on the Lender Schedule, as
such US Lender’s US Commitment may be increased from time to time pursuant to
Section 2.1(d).

 

“US Commitment
Fee Rate” means, on any day, the rate per annum set forth on the Pricing
Grid as the “US Commitment Fee Rate” based on the Applicable Rating Level on
such date.  Changes in the applicable US
Commitment Fee Rate will occur automatically without prior notice as changes in
the Applicable Rating Level occur. 
Administrative Agent will give notice promptly to US Borrower and US
Lenders of changes in the US Commitment Fee Rate.

 

“US
Commitment Period” means the period from and including the date hereof until
the US Maturity Date (or, if earlier, the day on which the obligation of US
Lenders to make US Loans to US Borrower hereunder pursuant to Section
2.1(a) and the obligation of US LC Issuer to issue US Letters of
Credit at the request of US Borrower pursuant to Section 2.11 has been
terminated or the day on which any of the US Notes first becomes due and
payable in full).

 

“US
Facility Usage” means, at the time in question, the aggregate amount of
US Loans to US Borrower pursuant to Section 2.1(a) and US LC Obligations
with respect to US Letters of Credit issued at the request of US Borrower
pursuant to Section 2.11 outstanding at such time.

 

“US LC
Issuer” means Fleet National Bank, in its capacity as the issuer of Letters
of Credit hereunder, and its successors in such capacity.  Administrative Agent may, with the consent
of US Borrower and the US Lender in question, appoint any US Lender hereunder
as a US LC Issuer in place of or in addition to Fleet National Bank.

 

“US LC
Obligations” means, at the time in question, the sum of all Matured LC
Obligations plus the maximum amounts which LC Issuer might then or thereafter
be called upon to advance under all Letters of Credit then outstanding.

 

“US Lender
Parties” means Administrative Agent, US LC Issuer and US Lenders.

 

“US Lenders”
means each signatory hereto designated as a US Lender, and the successors and
permitted assigns of each such party as holder of a US Note or Canadian Note.

 

22

 

“US Letter
of Credit” means any letter of credit issued by US LC Issuer hereunder at
the application of US Borrower or Canadian Borrower pursuant to Section 2.11.

 

“US Letter
of Credit Fee Rate” means, on any day, the rate per annum set forth on the
Pricing Grid as the “US LC Fee Rate” based on the Applicable Rating Level on
such date.  Changes in the applicable US
Letter of Credit Fee Rate will occur automatically without prior notice as
changes in the Applicable Rating Level occur. 
Administrative Agent will give notice promptly to US Borrower and
Lenders of changes in the US Letter of Credit Fee Rate.

 

“US Loans”
means (i) loans by US Lenders to US Borrower pursuant to Section 2.1(a), (ii)
loans by US Lenders to Canadian Borrower pursuant to Section 2.1(b), and (iii)
Canadian Term Loans.

 

“US
Maturity Date” means November 21, 2007.

 

“US Notes”
has the meaning given such term in Section 2.1(a) hereof.

 

“US
Obligations” means all Liabilities from time to time owing by any
Restricted Person to any Lender Party under or pursuant to any of the US Notes,
Canadian Notes or US Letters of Credit, including all US LC Obligations owing
thereunder or under or pursuant to any guaranty of the obligations of US
Borrower or Canadian Borrower or under the Loan Documents.  “US Obligation” means any part
of the US Obligations.

 

“Wholly
Owned Subsidiary” means any Subsidiary of a Person, all of the issued and
outstanding stock, limited liability company membership interests, or
partnership interests of which (including all rights or options to acquire such
stock or interests) are directly or indirectly (through one or more
Subsidiaries) owned by such Person.

 

“Working
Capital Borrowings” has the meaning given to such term in Section 2.2(c)
hereof.

 

Section 1.2.  Exhibits and Schedules; Additional Definitions.  All Exhibits and Schedules attached to this
Agreement are a part hereof for all purposes.

 

Section 1.3.  Amendment of Defined Instruments.  Unless the context otherwise requires or
unless otherwise provided herein the terms defined in this Agreement which
refer to a particular agreement, instrument or document also refer to and
include all renewals, extensions, modifications, amendments and restatements of
such agreement, instrument or document, provided that nothing contained in this
section shall be construed to authorize any such renewal, extension,
modification, amendment or restatement.

 

Section 1.4.  References and Titles.  All references in this Agreement to
Exhibits, Schedules, articles, sections, subsections and other subdivisions
refer to the Exhibits, Schedules, articles, sections, subsections and other
subdivisions of this Agreement unless expressly provided otherwise.  Titles appearing at the beginning of any
subdivisions are for convenience only and do not constitute any part of such
subdivisions and shall be disregarded in construing the language contained in
such subdivisions.  The words “this
Agreement,” “this instrument,” “herein,” “hereof,” “hereby,” “hereunder” and
words of similar import refer to this Agreement as a whole

 

23

 

and not to any particular
subdivision unless expressly so limited. 
The phrases “this section” and “this subsection” and similar phrases
refer only to the sections or subsections hereof in which such phrases
occur.  The word “or” is not exclusive,
and the word “including” (in its various forms) means “including without
limitation.”  Pronouns in masculine,
feminine and neuter genders shall be construed to include any other gender, and
words in the singular form shall be construed to include the plural and vice
versa, unless the context otherwise requires. 
References to an “officer” or “officers” of the General Partner or any
Restricted Person shall mean and include officers of such Person or the
controlling management entity of such Person as provided in such Person’s
organizational documents, as applicable.

 

Section 1.5.  Calculations and Determinations.  All calculations under the Loan Documents of
interest chargeable with respect to LIBOR Loans and of fees shall be made on
the basis of actual days elapsed (including the first day but excluding the
last) and a year of 360 days.  All other
calculations of interest made under the Loan Documents shall be made on the
basis of actual days elapsed (including the first day but excluding the last)
and a year of 365 or 366 days, as appropriate. 
Each determination by a Lender Party of amounts to be paid under Article
III or any other matters which are to be determined hereunder by a Lender Party
(such as any LIBOR Rate, BA Discount Rate, Business Day, Interest Period, or
Reserve Percentage) shall, in the absence of manifest error, be conclusive and
binding.  Unless otherwise expressly
provided herein or unless Majority Lenders otherwise consent all financial
statements and reports furnished to any Lender Party hereunder shall be
prepared and all financial computations and determinations pursuant hereto
shall be made in accordance with GAAP.

 

24

 

ARTICLE II - The Loans and Letters of
Credit

 

Section 2.1.  Commitments to Lend; Notes

 

(a).  US Loans to US Borrower.  Subject to the terms and conditions hereof,
each US Lender agrees to make US Loans to US Borrower upon US Borrower’s
request from time to time during the US Commitment Period, provided that
(a) subject to Sections 3.3, 3.4 and 3.6, all US Lenders are requested to
make US Loans of the same Type in accordance with their respective Percentage
Shares and as part of the same Borrowing, (b) after giving effect to such
US Loans, the US Facility Usage does not exceed the US Commitment determined as
of the date on which the requested US Loans are to be made, and (c) after
giving effect to such US Loans the US Loans by each US Lender to US Borrower
plus the existing US LC Obligations of such US Lender with respect to US
Letters of Credit issued at the request of US Borrower pursuant to Section 2.11
does not exceed such US Lender’s US Commitment.  The aggregate amount of all US Loans in any Borrowing must be
equal to $2,000,000 or any higher integral multiple of $250,000.  The obligation of US Borrower to repay to
each US Lender the aggregate amount of all US Loans made by such US Lender to
US Borrower, together with interest accruing in connection therewith, shall be
evidenced by a single promissory note (herein called such US Lender’s “US
Note”) made by US Borrower payable to the order of such US Lender in the
form of Exhibit A-1 with appropriate insertions.  The amount of principal owing on any US Lender’s US Note at any
given time shall be the aggregate amount of all US Loans theretofore made
by such US Lender to US Borrower minus all payments of principal theretofore
received by such US Lender on such US Note. 
Interest on each US Note shall accrue and be due and payable as provided
herein and therein.  Each US Note shall
be due and payable as provided herein and therein, and shall be due and payable
in full on the US Maturity Date. 
Subject to the terms and conditions of this Agreement, US Borrower may
borrow, repay, and reborrow under this Section 2.1(a).  US Borrower may have no more than seven
Borrowings of LIBOR Loans outstanding at any time.  All payments of principal and interest on the US Loans made
pursuant to this Section 2.1(a) shall be made in Dollars.

 

(b)  US Loans to Canadian Borrower.  Subject to the terms and conditions hereof,
each US Lender agrees to make loans to Canadian Borrower upon Canadian
Borrower’s request from time to time during the Canadian Commitment Period,
provided that (a) subject to Sections 3.3, 3.4 and 3.6, all US Lenders are
requested to make US Loans of the same Type in accordance with their respective
Percentage Shares and as part of the same Borrowing, (b) after giving
effect to such US Loans, the Canadian Facility Usage does not exceed the
Canadian Commitment determined as of the date on which the requested US Loans
are to be made, and (c) after giving effect to such US Loans the US Loans by
each US Lender to Canadian Borrower plus the existing US LC Obligations of such
US Lender with respect to US Letters of Credit issued at the request of
Canadian Borrower pursuant to Section 2.11 does not exceed such US Lender’s
Canadian Commitment.  The aggregate
amount of all US Loans in any Borrowing must be equal to $2,000,000 or any
higher integral multiple of $250,000. 
The obligation of Canadian Borrower to repay to each US Lender the
aggregate amount of all US Loans made by such US Lender to Canadian Borrower,
together with interest accruing in connection therewith, shall be evidenced by
a single promissory note (herein called such US Lender’s “Canadian Note”)
made by Canadian Borrower payable to the order of such US Lender in the form of
Exhibit A-2 with appropriate insertions. 
The amount of principal owing on any US Lender’s Canadian Note at any
given time shall be the aggregate amount of all US Loans theretofore made
by such US Lender to Canadian

 

25

 

Borrower minus all payments of
principal theretofore received by such US Lender on such Canadian Note.  Interest on each Canadian Note shall accrue
and be due and payable as provided herein and therein.  Each Canadian Note shall be due and payable
as provided herein and therein, and shall be due and payable in full on the
Canadian Term Loan Maturity Date. 
Subject to the terms and conditions of this Agreement, Canadian Borrower
may borrow, repay, and reborrow under this Section 2.1(b).  Canadian Borrower may have no more than
seven Borrowings of LIBOR Loans outstanding at any time.  All payments of principal and interest on
the US Loans made pursuant to this Section 2.1(b) shall be made in Dollars.

 

(c)  Canadian Advances.  Subject to the terms and conditions hereof,
each Canadian Lender agrees to extend credit to Canadian Working Capital
Borrower by (i) advancing funds to Canadian Working Capital Borrower specified
in a Borrowing Notice (herein called such Canadian Lender’s “Canadian Loans”)
and (ii) accepting and purchasing drafts of Bankers’ Acceptances issued under
this Agreement by Canadian Working Capital Borrower specified in a Borrowing
Notice (herein called such Canadian Lender’s “Bankers’ Acceptances”;
each Canadian Lender’s Canadian Loans and Bankers’ Acceptances are herein
collectively called such Canadian Lender’s “Canadian Advances”) upon Canadian
Working Capital Borrower’s request from time to time during the Canadian
Working Capital Commitment Period, provided that (a) subject to Sections
3.3, 3.4, and 3.6, all Canadian Lenders are requested to make Canadian Advances
of the same Type in accordance with their respective Percentage Shares and as
part of the same Borrowing, (b) after giving effect to such Canadian
Advances, the Canadian Working Capital Facility Usage does not exceed the
Canadian Working Capital Commitment determined as of the date on which the
requested Canadian Advances are to be made, and (c) after giving effect to such
Canadian Advances the Canadian Advances by each Canadian Lender plus the
existing Canadian LC Obligations of such Canadian Lender does not exceed such
Canadian Lender’s Canadian Working Capital Commitment.  The aggregate amount of all Canadian Loans
in any Borrowing advanced in Canadian Dollars must be equal to C$500,000 or any
higher integral multiple of C$100,000. The obligation of Canadian Working
Capital Borrower to repay to each Canadian Lender the aggregate amount of all
Canadian Loans made by such Canadian Lender to Canadian Working Capital
Borrower, together with interest accruing in connection therewith, shall be
evidenced by a single promissory note (herein called such Canadian Lender’s “Canadian
Working Capital Note”) made by Canadian Working Capital Borrower payable to
the order of such Canadian Lender in the form of Exhibit A-3 with
appropriate insertions.  The amount of
principal owing on any Canadian Lender’s Canadian Working Capital Note at any
given time shall be the aggregate amount of all Canadian Loans theretofore made
by such Canadian Lender minus all payments of principal theretofore received by
such Canadian Lender on such Canadian Working Capital Note.  Interest on each Canadian Working Capital
Note shall accrue and be due and payable as provided herein and therein.  Each Canadian Lender’s Canadian Working
Capital Note shall be due and payable as provided herein and therein and shall
be due and payable in full on the Canadian Working Capital Maturity Date.  Subject to the terms and conditions of this
Agreement, Canadian Working Capital Borrower may borrow, repay, and reborrow
under this Section 2.1(c).  Canadian
Working Capital Borrower may have no more than seven Borrowings of BA’s
collectively outstanding at any time. 
All payments of principal and interest on the Canadian Loans shall be
made in the currency in which such corresponding Canadian Loan was funded.  All Canadian Loans shall be made in Canadian
Dollars, or, upon the written request of Canadian Working Capital Borrower, in
Dollars.  The aggregate amount of all
Canadian Loans in any Borrowing advanced in Dollars must be equal to $500,000
or any higher integral multiple of $100,000.

 

26

 

(d)  Increase in Commitments.  US Borrower shall have the right, without
the consent of the Lenders but with the prior approval of the Administrative
Agent, not to be unreasonably withheld, to cause from time to time an increase
in the Commitments by adding to this Agreement one or more additional Lenders
or by allowing one or more Lenders to increase their respective Commitments;
provided however (i) no Event of Default shall have occurred hereunder which is
continuing, (ii) no such increase shall result in the aggregate Commitment
hereunder to exceed $750,000,000, and (iii) no Lender’s Commitment shall be
increased without such Lender’s consent. 
Upon any increase in the aggregate Commitment pursuant to the
immediately preceding sentence, the Lenders hereby authorize the Administrative
Agent and the Borrowers to make non-ratable borrowings and prepayments of the
Loans, and if any such prepayment requires the payment of LIBOR Loans,
Borrowers shall pay any required amounts pursuant to Section 3.6 other than on
the last day of the applicable Interest Period, in order to ensure that the
Loans of the Lenders shall be outstanding on a ratable basis in accordance with
their respective Percentage Shares and that the Commitments shall be as set
forth in the Lenders Schedule and no such borrowing or prepayment shall violate
any provisions of this Agreement.

 

Section 2.2.  Requests for Loans.  A requesting Borrower must give to the
appropriate Agent written notice (or telephonic notice promptly confirmed in
writing) of any requested Borrowing. 
Each such notice constitutes a “Borrowing Notice” hereunder and must:

 

(a)  specify (i) as to US Loans
(A) the aggregate amount of any such Borrowing and the date on which Base Rate
Loans are to be advanced, or (B) the aggregate amount of any such Borrowing of
new LIBOR Loans, the date on which such LIBOR Loans are to be advanced (which
shall be the first day of the Interest Period which is to apply thereto), and
the length of the applicable Interest Period, or (ii) as to Canadian Loans (A)
 the aggregate amount of any such Borrowing of new Canadian Prime Rate
Loans (if Canadian Dollar-denominated Loans) or Canadian US Dollar Base Rate
Loans (if Dollar-denominated Loans) and the date on which such Canadian Loans
are to be advanced, or (i) the aggregate amount of any such Borrowing by
way of Bankers’ Acceptances (subject to Section 2.16(f)), and the date on which
such Bankers’ Acceptances are to be accepted and the maturity of such Bankers’
Acceptances;

 

(b)  be received by the
appropriate Agent not later than 11:00 a.m., Boston, Massachusetts time or
Toronto, Canada time, as the case may be, on (i) the day on which any such Base
Rate Loans are to be made, (ii) the third Business Day preceding the day on
which any such LIBOR Loans are to be made or any such Bankers’ Acceptances are
to be issued; and

 

(c)  if any requested Borrowing
or portion thereof is to be utilized exclusively for working capital purposes
(such Borrowing or such portion being called a “Working Capital Borrowing”),
such Borrower shall specify in the Borrowing Notice that such Borrowing or such
portion is a Working Capital Borrowing. 
In addition, any repayment of a Loan that is intended as a repayment of
all or any part of the outstanding amount of one or more Working Capital
Borrowings shall be so identified to the appropriate Agent at the time of such
repayment.

 

27

 

Each such written request or
confirmation must be made in the form and substance of the “US Borrowing
Notice” attached hereto as Exhibit B-1 or the “Canadian Borrowing Notice”
attached hereto as Exhibit B-2, duly completed.  Each such telephonic request shall be deemed a representation,
warranty, acknowledgment and agreement by such Borrower as to the matters which
are required to be set out in such written confirmation.  Upon receipt of any such Borrowing Notice,
the appropriate Agent shall give each US Lender or Canadian Lender, as the case
may be, prompt notice of the terms thereof. 
If all conditions precedent to such new Loans have been met, each US
Lender or Canadian Lender, as the case may be, will on the date requested
promptly remit to the appropriate Agent at its office in Boston, Massachusetts
or Toronto, Canada, as the case may be, the amount of such Lender’s new Loan in
immediately available funds, and upon receipt of such funds, unless to its
actual knowledge any conditions precedent to such Loans have been neither met
nor waived as provided herein, such Agent shall promptly make such Loans
available to the requesting Borrower. 
Unless an Agent shall have received prompt notice from a Lender that
such Lender will not make available to such Borrower such Lender’s new Loan,
such Agent may in its discretion assume that such Lender has made such Loan
available to such Agent in accordance with this section, and such Agent may if
it chooses, in reliance upon such assumption, make such Loan available to such
Borrower.  If and to the extent such
Lender shall not so make its new Loan available to such Agent, such Lender and
requesting Borrower severally agree to pay or repay to such Agent within three
days after demand the amount of such Loan together with interest thereon, for
each day from the date such amount was made available to such Borrower until
the date such amount is paid or repaid to such Agent, with interest at (i) as
to US Loans, the Federal Funds Rate, and as to Canadian Loans, the “Bank Rate”
as set by the Bank of Canada, as quoted on Reuters page BOCFAD, if such Lender
is making such payment, and (ii) the interest rate applicable at the time to
the other new Loans made on such date, if such Borrower is making such
repayment.  If neither such Lender nor
such Borrower pays or repays to such Agent such amount within such three-day
period, such Agent shall be entitled to recover from such Borrower, on demand
in lieu of the interest provided for in the preceding sentence, interest
thereon at the Default Rate, calculated from the date such amount was made
available to such Borrower.  The failure
of any Lender to make any new Loan to be made by it hereunder shall not relieve
any other Lender of its obligation hereunder, if any, to make its new Loan, but
no Lender shall be responsible for the failure of any other Lender to make any
new Loan to be made by such other Lender. 
All Borrowings of US Loans shall be advanced in Dollars.  All Borrowings of Canadian Loans shall be advanced
in Canadian Dollars, or, upon the written request of Canadian Working Capital
Borrower, in Dollars in an amount equal to the Dollar Equivalent of such
requested Canadian Loan.

 

Section 2.3.  Continuations and Conversions of Existing
Loans.  US Borrower or Canadian
Borrower may make the following elections with respect to US Loans already
outstanding: (i) to Convert, in whole or in part, Base Rate Loans to LIBOR
Loans, (ii) to Convert, in whole or in part, LIBOR Loans to Base Rate Loans on
the last day of the Interest Period applicable thereto, and (iii) to Continue,
in whole or in part, LIBOR Loans beyond the expiration of such Interest Period
by designating a new Interest Period to take effect at the time of such
expiration.  Subject to the terms of
Section 2.17 with respect to Bankers’ Acceptances, Canadian Working Capital
Borrower may make the following elections with respect to Canadian Advances
already outstanding: (i) to Convert any Type of Canadian Advance to any other
Type of Canadian Advance, provided that any such Conversion of a Bankers’
Acceptance must be made on the date of maturity thereof; and (ii) to
rollover any existing Bankers’ Acceptance by designating the new maturity date
applicable thereto.  In making such
elections, such Borrower

 

28

 

may combine existing US Loans
to such Borrower or Canadian Advances to such Borrower made pursuant to
separate Borrowings into one new Borrowing or divide existing US Loans to such
Borrower or Canadian Advances to such Borrower made pursuant to one Borrowing
into separate new Borrowings, provided that such Borrower may have no more than
seven Borrowings of LIBOR Loans or seven BA’s outstanding at any time.  To make any such election, such Borrower
must give to the appropriate Agent written notice (or telephonic notice
promptly confirmed in writing) of any such Conversion or Continuation of
existing Loans or Canadian Advances, with a separate notice given for each new
Borrowing.  Each such notice constitutes
a “Continuation/Conversion Notice” hereunder and must:

 

(i)  specify the existing US
Loans or Canadian Advances which are to be Continued or Converted;

 

(ii)  specify (A) the aggregate
amount of any Borrowing of Base Rate Loans, Canadian Prime Rate Loans or
Canadian US Dollar Base Rate Loans into which such existing US Loans or Canadian
Advances, as the case may be, are to be Continued or Converted and the date on
which such Continuation or Conversion is to occur, (B) the aggregate amount of
any Borrowing of LIBOR Loans into which such existing US Loans are to be
Continued or Converted,  the date on
which such Continuation or Conversion is to occur (which shall be the first day
of the Interest Period which is to apply to such LIBOR Loans), and the length
of the applicable Interest Period, or (C) the amount of any Borrowing of Bankers’
Acceptances into which such existing Canadian Advances are to be Continued or
Converted, the date on which such Continuation or Conversion is to occur, and
the maturity of such Bankers’ Acceptances; and

 

(iii) be received by the appropriate Agent not later than 11:00 a.m.
Boston, Massachusetts time or Toronto, Canada time, as the case may be, on (i)
the day on which any such Continuation or Conversion to Base Rate Loans,
Canadian Prime Rate Loans or Canadian US Dollar Base Rate Loans is to occur, or
(ii) the third Business Day preceding the day on which any such Continuation or
Conversion to LIBOR Loans or Bankers’ Acceptances is to occur.

 

Each such written request or
confirmation must be made in the form and substance of the “US
Continuation/Conversion Notice” attached hereto as Exhibit C-1 or the “Canadian
Continuation/Conversion Notice” attached hereto as Exhibit C-2, as appropriate,
duly completed.  Each such telephonic
request shall be deemed a representation, warranty, acknowledgment and
agreement by the requesting Borrower as to the matters which are required to be
set out in such written confirmation. 
Upon receipt of any such Continuation/Conversion Notice, the appropriate
Agent shall give each US Lender or Canadian Lender, as the case may be,  prompt notice of the terms thereof.  Each Continuation/Conversion Notice shall be
irrevocable and binding on the requesting Borrower.  During the continuance of any Default, neither US Borrower nor
Canadian Borrower may make any election to Convert existing US Loans into LIBOR
Loans or Continue existing US Loans as LIBOR Loans beyond the expiration of
their respective and corresponding Interest Period then in effect, nor may
Canadian Working Capital Borrower make any election to Convert existing
Canadian Advances into Bankers’ Acceptances or to rollover existing Bankers’
Acceptances into new Bankers’ Acceptances. 
If (due to the existence of a Default or for any other reason) any
Borrower fails to timely and properly give any Continuation/Conversion Notice
with respect to a Borrowing of existing LIBOR Loans or Bankers’ Acceptances at
least three days

 

29

 

prior to the end of the
Interest Period applicable to such LIBOR Loans or the maturity of such Bankers’
Acceptance, any such LIBOR Loans, to the extent not prepaid at the end of such
Interest Period, shall automatically be Converted into Base Rate Loans at the
end of such Interest Period, and any such Bankers’ Acceptances, to the extent
not prepaid at such maturity, shall automatically be Converted into Canadian
Prime Rate Loans at such maturity.  No
new funds shall be repaid by any Borrower or advanced by any Lender in
connection with any Continuation or Conversion of existing US Loans or Canadian
Advances pursuant to this section, and no such Continuation or Conversion shall
be deemed to be a new advance of funds for any purpose; such Continuations and
Conversions merely constitute a change in the interest rate applicable to such
already outstanding US Loans or Canadian Advances.

 

Section 2.4.  Use of Proceeds.  Borrowers shall use all Loans and Canadian
Advances to (a) refinance outstanding indebtedness under the Existing
Agreements, and (b) finance capital expenditures of any Restricted Person, pay
reimbursement obligations of Letters of Credit, provide working capital for
operations and for other general business purposes, including
acquisitions.  Borrowers shall use all
Letters of Credit for its and its Subsidiaries’ general corporate purposes
including in relation to the purchase or exchange by Borrowers of Petroleum
Products.  In no event shall the funds
from any Loans, Canadian Advances or any Letters of Credit be used directly or
indirectly by any Person for personal, family, household or agricultural purposes
or for the purpose, whether immediate, incidental or ultimate, of purchasing,
acquiring or carrying any “margin stock” (as such term is defined in Regulation
U promulgated by the Board of Governors of the Federal Reserve System) or to
extend credit to others directly or indirectly for the purpose of purchasing or
carrying any such margin stock. 
Borrowers represent and warrant that they are not engaged principally,
or as one of their important activities, in the business of extending credit to
others for the purpose of purchasing or carrying such margin stock.

 

Section 2.5.  Interest Rates and Fees.

 

(a)  Interest Rates.

 

(i)  Each US Loan shall bear interest as follows:
(A) unless the Default Rate shall apply, each Base Rate Loan shall bear
interest on each day outstanding at the Base Rate plus the Applicable Margin in
effect on such day, and each LIBOR Loan shall bear interest on each day during
the related Interest Period at the related LIBOR Rate plus the Applicable
Margin in effect on such day, and (B) during a Default Rate Period, all US
Loans shall bear interest on each day outstanding at the applicable Default
Rate.

 

(ii)  Each Canadian Loan shall bear interest as
follows:  (A) unless the Default Rate
shall apply, each Canadian Prime Rate Loan shall bear interest on each day
outstanding at the Canadian Prime Rate plus the Applicable Margin in effect on
such day, and each Canadian US Dollar Base Rate Loan shall bear interest on
each day outstanding at the Canadian US Dollar Base Rate plus the Applicable
Margin in effect on such day, and (B) during a Default Rate Period, all
Canadian Loans shall bear interest on each day outstanding at the applicable
Default Rate.

 

(iii)  If an Event of Default based upon Section
8.1(a), Section 8.1(b) or, with respect to any Borrower, based upon Section
8.1(h)(i), (h)(ii) or (h)(iii) exists and the Loans are

 

30

 

not bearing interest at the
Default Rate, the past due principal and past due interest shall bear interest
on each day outstanding at the applicable Default Rate.

 

(iv)  The interest rate shall change whenever the
applicable Base Rate, LIBOR Rate, Canadian Prime Rate, Canadian US Dollar Base
Rate or Applicable Margin changes.  In
no event shall the interest rate on any Loan exceed the Highest Lawful Rate.

 

(b)  Commitment Fees; Reduction of Commitments.

 

(i)  In consideration of each US Lender’s
commitment to make US Loans to US Borrower pursuant to Section 2.1(a), US
Borrower will pay to Administrative Agent for the account of each US Lender a
commitment fee determined on a daily basis equal to the US Commitment Fee Rate
in effect on such day times such US Lender’s Percentage Share of the unused
portion of the US Commitment on each day during the US Commitment Period,
determined for each such day by deducting from the amount of the US Commitment
at the end of such day the US Facility Usage.

 

(ii)  In consideration of each US Lender’s
commitment to make US Loans to Canadian Borrower pursuant to Section
2.1(b), Canadian Borrower will pay to Administrative Agent for the account of
each US Lender a commitment fee determined on a daily basis equal to the
Canadian Commitment Fee Rate in effect on such day times such US Lender’s
Percentage Share of the unused portion of the Canadian Commitment on each day
during the Canadian Commitment Period, determined for each such day by
deducting from the amount of the Canadian Commitment at the end of such day the
Canadian Facility Usage.

 

(iii)  In consideration of each Canadian Lender’s
commitment to make Canadian Loans to Canadian Working Capital Borrower pursuant
to Section 2.1(c), Canadian Borrower will pay to Canadian Administrative Agent
for the account of each Canadian Lender a commitment fee determined on a daily
basis equal to the Canadian Working Capital Commitment Fee Rate in effect on
such day times such Canadian Lender’s Percentage Share of the unused portion of
the Canadian Working Capital Commitment on each day during the Canadian Working
Capital Commitment Period, determined for each such day by deducting from the
amount of the Canadian Working Capital Commitment at the end of such day the
Canadian Working Capital Facility Usage.

 

(iv)  Each such commitment fee shall be due and
payable in arrears on the last day of each Fiscal Quarter and at the end of the
US Commitment Period, Canadian Commitment Period, and Canadian Working Capital
Commitment Period, as the case may be. 
Each Borrower shall have the right from time to time to permanently
reduce the US Commitment, Canadian Commitment or Canadian Working Capital
Commitment, as the case may be, provided that (A) notice of such reduction
is given not less than 2 Business Days prior to such reduction, (B) the
resulting US Commitment, Canadian Commitment or Canadian Working Capital
Commitment is not less than the US Facility Usage, Canadian Facility Usage or
Canadian Working Capital Facility Usage, respectively, and (C) each partial
reduction shall be in an amount at least equal to $500,000 and in multiples of
$100,000 in excess thereof.

 

(c)  Stamping Fees.  In consideration of each Canadian Lender’s
commitment to accept or participate in Bankers’ Acceptances under this
Agreement, Canadian Working Capital Borrower

 

31

 

will pay to Canadian
Administrative Agent for the account of such Canadian Lender the Stamping Fee
Rate multiplied by the face amount of each Bankers’ Acceptance accepted by such
Canadian Lender under this Agreement calculated for the number of days in the
term of such Bankers’ Acceptance.  Such
fee shall be due and payable on the date on which such Bankers’ Acceptances are
accepted and shall be deducted from the Discount Proceeds paid to Canadian
Working Capital Borrower.  Such fee
shall be non-refundable, notwithstanding any reduction in the Stamping Fee Rate
during the term of such Bankers’ Acceptances.

 

(d)  Agents’ Fees.  In addition to all other amounts due to
Administrative Agent under the Loan Documents, US Borrower will pay fees to
Administrative Agent as described in the fee letter dated October 20, 2003
between Administrative Agent and US Borrower. 
In addition to all other amounts due to Canadian Administrative Agent
under the Loan Documents, Canadian Working Capital Borrower will pay fees to
Canadian Administrative Agent as described in the agency fee agreement between
Canadian Administrative Agent and Canadian Working Capital Borrower.

 

Section 2.6.  Extension of Canadian Conversion Date.

 

(a)  Canadian Borrower may, at its option and
from time to time during the Canadian Commitment Period, request an offer to
extend the Canadian Commitment Period by delivering to Administrative Agent a
written request made by Canadian Borrower to each US Lender with a portion of
the Canadian Commitment to issue an offer to Canadian Borrower extending the
Canadian Commitment Period for a further 364 days not more than sixty days and
not less than thirty days prior to the then current Canadian Conversion
Date.  Administrative Agent shall
forthwith provide a copy of the request to each such US Lender.  Upon receipt from Administrative Agent of
such request, each such US Lender shall, within twenty days after the date of
such US Lender’s receipt of such request from Administrative Agent, either:

 

(i)  notify Administrative Agent
of its acceptance of the request and the terms and conditions, if any, upon
which such US Lender is prepared to extend the Canadian Conversion Date; or

 

(ii)  notify Administrative
Agent that such request has been denied, such notice to forthwith be forwarded
by Administrative Agent to Canadian Borrower to allow Canadian Borrower to seek
a replacement lender (any such US Lender giving notice of such denial is herein
called a “Non-Accepting Lender”). 
The failure of a US Lender to so notify Administrative Agent within such
twenty day period shall be deemed to be notification by such US Lender to
Administrative Agent that such US Lender has denied such request.

 

(b)  Following any US Lender or US Lenders
(including any replacement lender that has agreed to become a US Lender
hereunder and to accept all or a portion of the Canadian Commitments of
Non-Accepting Lenders and such extension request) notice to Administrative
Agent under Section 2.6(a) that such US Lender or US Lenders accept such
request, such acceptance having common terms and conditions, Administrative
Agent shall deliver to Canadian Borrower such offer incorporating the said
terms and conditions.  Such offer shall
be open for acceptance by Canadian Borrower until the fifth Business Day
immediately preceding the then current Canadian Conversion Date.  Upon written notice by Canadian Borrower to

 

32

 

Administrative Agent accepting
such offer and agreeing to the terms and conditions, if any, specified therein
(the date of such notice of acceptance being called the “Extension Date”),
the Canadian Conversion Date shall be extended to the date 364 days from the
Extension Date and the terms and conditions specified in such offer shall be
immediately effective.

 

(c)  Upon Canadian Borrower’s acceptance of US
Lenders’ offer to extend the Canadian Commitment Period pursuant to Section
2.6(b) above, Canadian Borrower shall be entitled to choose any of the
following in respect of each Non-Accepting Lender prior to the Extension Date,
provided that if Canadian Borrower does not make an election prior to such
Canadian Conversion Date, Canadian Borrower shall be deemed to have irrevocably
elected to exercise the provisions of Section 2.6(c)(ii)(B):

 

(i)  replace the Non-Accepting Lender by reaching satisfactory
arrangements with one or more existing US Lenders or new US Lenders, for the
purchase, assignment and assumption of the US Obligations owing by Canadian
Borrower and Canadian Commitment of such Non-Accepting Lender, and such
Non-Accepting Lender shall be obligated to sell and/or assign such US
Obligations owing by Canadian Borrower and Canadian Commitment in accordance
with the terms hereof;

 

(ii) the Non-Accepting Lender’s obligation to make new US Loans to
Canadian Borrower and participate in US Letters of Credit issued hereunder at
the request of Canadian Borrower shall be canceled as of the Extension Date,
the Canadian Commitment shall be reduced by the amount so canceled, and either
(A) on or prior to the Extension Date the Canadian Borrower shall repay in full
all US Obligations owing by Canadian Borrower to such Non-Accepting Lender, or
(B) all US Obligations owing by Canadian Borrower to such Non-Accepting Lender
shall convert to a term loan maturing on the date five years and one day after
the date of such conversion.

 

In connection with any such
replacement of a US Lender pursuant to Section 2.6(c)(i) above, the Canadian
Borrower shall pay all costs that would have been due to such Lender Party
pursuant to Section 3.6 if such US Lender’s Canadian Advances had been prepaid
at the time of such replacement.

 

(d)  Canadian Borrower understands that the
consideration of any request constitutes an independent credit decision which
each US Lender retains the absolute and unfettered discretion to make and that
no commitment in this regard is hereby given by a US Lender and that any offer
to extend the Canadian Conversion Date may be on such terms and conditions in
addition to those set out herein as the extending US Lenders stipulate.

 

(e) Upon the
conversion of any Lender’s US Loan to Canadian Borrower to a term loan pursuant
to Section 2.6(c)(ii)(B) above or to a Canadian Term Loan pursuant to Section
2.7 below, Canadian Borrower will pay to such Lender a conversion fee equal to
one-quarter percent (0.25%) of the outstanding principal amount of such US Loan
as of such conversion, due and payable on the date of such conversion.

 

Section 2.7.  Conversion to Canadian Term Loan.  Unless there is an extension of the Canadian
Commitment Period in accordance with Section 2.6, effective at 11:59 p.m.
Boston, Massachusetts time on the day immediately preceding the Canadian
Conversion Date, and

 

33

 

provided that no Event of Default
shall have occurred and be continuing, (i) each US Lender’s obligation to
make new US Loans to Canadian Borrower and US LC Issuer’s obligation to issue
US Letters of Credit hereunder at the request of Canadian Borrower shall be
canceled automatically, (ii) each US Lender’s US Loans to Canadian
Borrower shall become term loans (“Canadian Term Loans”) maturing on the
Canadian Term Loan Maturity Date and (iii) Canadian Borrower shall pay to such
US Lenders the conversion fee set forth in Section 2.6(e) above..

 

Section 2.8.  Optional Prepayments.

 

(a)  US Loans.  US Borrower or Canadian Borrower may, upon three Business Days’
notice, as to LIBOR Loans, or same Business Day’s notice, as to Base Rate
Loans, to Administrative Agent (and Administrative Agent will promptly give
notice to the other US Lenders) from time to time and without premium or
penalty prepay the US Loans, in whole or in part, so long as the aggregate
amounts of all partial prepayments of principal on the US Loans equals
$2,500,000 or any higher integral multiple of $250,000.  Upon receipt of any such notice,
Administrative Agent shall give each US Lender prompt notice of the terms
thereof.

 

(b)  Canadian Loans.  Canadian Working Capital Borrower may, upon
three Business Days’ notice to Canadian Administrative Agent (and Canadian
Administrative Agent will promptly give notice to the other Canadian Lenders)
from time to time and without premium or penalty prepay the Canadian Loans, in
whole or in part, so long as the aggregate amounts of all partial prepayments
of principal on the Canadian Loans equals $2,500,000 or any higher integral
multiple of $250,000.  No BA may be
prepaid hereunder except in accordance with Section 2.19.

 

(c)  Accrued and Unpaid Interest.  Each prepayment of principal of a Loan under
this section shall be accompanied by all interest then accrued and unpaid on
the principal so prepaid.  Any principal
or interest prepaid pursuant to this section shall be in addition to, and not
in lieu of, all payments otherwise required to be paid under the Loan Documents
at the time of such prepayment.

 

(d)  Prepayment.  Following notice by any Borrower pursuant to Section 2.8(a) or
(b) above, such Borrower shall make such prepayment, and the prepayment amount
specified in such notice shall be due and payable, on the date specified in
such notice.

 

Section 2.9.  Mandatory Prepayments.

 

(a) US
Loans to US Borrower.  If at any
time the US Facility Usage exceeds the US Commitment (whether due to a
reduction in the US Commitment in accordance with this Agreement, or
otherwise), US Borrower shall immediately upon demand prepay the principal
of the US Loans made to US Borrower in an amount at least equal to such excess.

 

(b) US
Loans to Canadian Borrower.  If at
any time the Canadian Facility Usage exceeds the Canadian Commitment (whether
due to a reduction in the Canadian Commitment in accordance with this
Agreement, or otherwise), Canadian Borrower shall immediately upon demand
prepay the principal of the US Loans made to Canadian Borrower in an amount at
least equal to such excess.

 

34

 

(c) Canadian
Loans.  Except to the extent
permitted by Section 2.9(e), if the Canadian Working Capital Facility Usage
ever exceeds the Canadian Working Capital Commitment, Canadian Working Capital
Borrower shall immediately on demand prepay the principal of the Canadian
Advances in an amount at least equal to such excess.  Any such excess shall be applied first to outstanding Canadian
Loans, and then to prepay BA’s in accordance with Section 2.19.

 

(d)  Working Capital Borrowings.  For an economically meaningful period of
time in each Fiscal Year, as reasonably determined by GP LLC, the aggregate
outstanding principal balance of all Working Capital Borrowings shall be reduced
to a relatively small amount as may be reasonably specified by GP LLC.

 

(e)  Currency Fluctuations.  Notwithstanding any other provision of this
Agreement, Canadian Administrative Agent shall have the right to calculate the
outstanding Canadian Working Capital Facility Usage for all purposes including
making a determination from time to time of the available undrawn portion of
the Canadian Working Capital Commitment. 
If following such calculation, Canadian Administrative Agent determines
that the Canadian Working Capital Facility Usage is greater than 105% of the
Canadian Working Capital Commitment, then Canadian Administrative Agent shall
so advise Canadian Working Capital Borrower and Canadian Working Capital
Borrower shall repay, on the earlier of five Business Days after such advice
and the next applicable Interest Payment Date immediately following such
advice, an amount sufficient to eliminate such excess, together with all
accrued interest on the amount so paid. 
Any such excess shall be applied first to outstanding Canadian Loans,
and then to prepay BA’s in accordance with Section 2.19.

 

(f)  Canadian Income Tax.  Except as otherwise provided in Section 8.1,
notwithstanding anything to the contrary contained herein, in no event shall
Canadian Borrower be required to repay 25% or more of the principal amount (as
defined in the Income Tax Act (Canada)) of any US Loan to Canadian Borrower
prior to five years and a day after the date on which such US Loan is made.

 

(g)  Accrued and Unpaid Interest.  Each prepayment of principal under this
section shall be accompanied by all interest then accrued and unpaid on the
principal so prepaid.  Any principal or
interest prepaid pursuant to this section shall be in addition to, and not in
lieu of, all payments otherwise required to be paid under the Loan Documents at
the time of such prepayment.

 

Section 2.10.  Letters of Credit.  Subject to the terms and conditions hereof,
US Borrower and Canadian Borrower may during the US Commitment Period and
Canadian Commitment Period, respectively, request US LC Issuer to issue, amend,
or extend the expiration date of, one or more US Letters of Credit, and
Canadian Working Capital Borrower may during the Canadian Working Capital
Commitment Period request Canadian LC Issuer to issue, amend, or extend the
expiration date of, one or more Canadian Letters of Credit, provided that,
after taking such Letter of Credit into account:

 

(a)  (i) as to a US Letter of
Credit requested by US Borrower, the US Facility Usage does not exceed the US
Commitment at such time, (ii) as to a US Letter of Credit requested by Canadian
Borrower, the Canadian Facility Usage does not exceed the Canadian Commitment
at such time, or (iii) as to a Canadian Letter of Credit, the

 

35

 

Canadian
Working Capital Facility Usage does not exceed the Canadian Working Capital
Commitment;

 

(b)  the expiration date of such
Letter of Credit is prior to the earlier of (i) one (1) year after the date of
issuance of such Letter of Credit, or (ii) (A) as to a US Letter of Credit
requested by US Borrower, the end of the US Commitment Period, (B) as to a US
Letter of Credit requested by Canadian Borrower, the Canadian Conversion Date,
or (C) as to a Canadian Letter of Credit, the end of the Canadian Working
Capital Commitment Period;

 

(c)  such Letter of Credit is to
be used for general corporate purposes of such requesting Borrower or any of
its Subsidiaries and is not directly or indirectly used to assure payment of or
otherwise support any Indebtedness of any Person, except Indebtedness of a
Restricted Person;

 

(d)  the issuance of such Letter
of Credit will be in compliance with all applicable governmental restrictions,
policies, and guidelines and will not subject LC Issuer to any cost which
is not reimbursable under Article III;

 

(e)  the form and terms of such
Letter of Credit are acceptable to LC Issuer in its sole and absolute
discretion; and

 

(f)  all other conditions in
this Agreement to the issuance of such Letter of Credit have been satisfied.

 

The appropriate LC Issuer will
honor any such request if the foregoing conditions (a) through (f) (in the
following Section 2.11 called the “LC Conditions”) have been met as of
the date of issuance, amendment, or extension of the expiration, of such Letter
of Credit.  The outstanding letters of
credit issued by either LC Issuer under the Existing Agreements shall be deemed
to be Letters of Credit issued hereunder; each Borrower hereby represents and
warrants that the LC Conditions have been met as of the date hereof with
respect to each such Letter of Credit. 
Any requesting Borrower may request that any Letter of Credit be issued
in Dollars or in Canadian Dollars, and, subject to the terms and conditions
hereof, LC Issuers will honor such requests.

 

Section 2.11.  Requesting Letters of Credit.  The requesting Borrower must make written
application for any Letter of Credit at least two Business Days before the date
on which such Borrower desires for the appropriate LC Issuer to issue such
Letter of Credit.  By making any such
written application, unless otherwise expressly stated therein, such Borrower
shall be deemed to have represented and warranted that the LC Conditions
described in Section 2.10 will be met as of the date of issuance of such Letter
of Credit.  Each such written
application for a Letter of Credit must be made in writing in the form and
substance of Exhibit F-1, as to US Letters of Credit, and Exhibit F-2, as to
Canadian Letters of Credit, and the terms and provisions of which are hereby
incorporated herein by reference (or in such other form as may mutually be
agreed upon by such LC Issuer and such Borrower).  If all LC Conditions for a Letter of Credit
have been met as described in Section 2.10 on any Business Day before 11:00
a.m. Boston, Massachusetts time or Toronto, Canada time, as the case may be,
such LC Issuer will issue such Letter of Credit on the same Business Day at
such LC Issuer’s office in Boston, Massachusetts or Toronto, Canada, as the
case may be.  If the LC Conditions are
met as described in Section 2.10

 

36

 

on any Business Day on or after
11:00 a.m. at such LC Issuer’s office in Boston, Massachusetts or Toronto,
Canada, local time, such LC Issuer will issue such Letter of Credit on the next
succeeding Business Day at such LC Issuer’s office in Boston, Massachusetts or
Toronto, Canada, as the case may be.  If
any provisions of any LC Application conflict with any provisions of this
Agreement, the provisions of this Agreement shall govern and control.

 

Section 2.12.  Reimbursement and Participations.

 

(a)  Reimbursement or Borrowing by Borrower.  Each Matured US LC Obligation shall
constitute a loan by US LC Issuer to US Borrower, to the extent such Borrower
requested such Letter of Credit.  US
Borrower promises to pay to US LC Issuer, or to US LC Issuer’s order, on
demand, the full amount of each Matured US LC Obligation with respect to
Letters of Credit requested by US Borrower, together with interest thereon  (i) at the Base Rate plus the Applicable
Margin to and including the second Business Day after the Matured US LC
Obligation is incurred and (ii) at the Default Rate on each day thereafter.  With respect to any Matured US LC Obligation
with respect to Letters of Credit requested by Canadian Borrower, unless
payment thereof is otherwise made to or to the order of US LC Issuer, Canadian
Borrower shall be deemed to have requested a Base Rate Loan at 10:59 a.m.,
Toronto, Canada time, on the date US LC Issuer pays such Matured US LC
Obligation, without regard to the minimum and multiples specified in Section
2.1(b) or any conditions set forth in Section 4.2, and each US Lender agrees
upon notice by US LC Issuer of such payment of such Matured US LC Obligation to
fund its Percentage Share of such deemed Base Rate Loan, notwithstanding the
failure of any condition set forth in Section 2.1(b) or 4.2 to be
satisfied.  Canadian Borrower and US
Lenders agree that the proceeds of such Base Rate Loans, and any interest
accrued thereon, shall be paid directly to US LC Issuer and applied to such
Matured US LC Obligation.  Each Matured
Canadian LC Obligation shall constitute a loan by Canadian LC Issuer to
Canadian Working Capital Borrower. 
Canadian Working Capital Borrower promises to pay to Canadian LC Issuer,
or to Canadian LC Issuer’s order, on demand, the full amount of each Matured
Canadian LC Obligation, together with interest thereon  (i) at the Canadian Prime Rate plus the
Applicable Margin to and including the second Business Day after the Matured
Canadian LC Obligation is incurred and (ii) at the Default Rate on each day
thereafter.

 

(b)  Letter of Credit Advances.  If the beneficiary of any Letter of Credit
makes a draft or other demand for payment thereunder then the appropriate
Borrower may, during the interval between the making thereof and the honoring
thereof by the LC Issuer thereof, request US Lenders or Canadian Lenders,
as the case may be, to make US Loans or Canadian Advances to such Borrower in the
amount of such draft or demand, which US Loans or Canadian Advances shall be
made concurrently with such LC Issuer’s payment of such draft or demand and
shall be immediately used by such LC Issuer to repay the amount of such
resulting Matured US LC Obligation or Matured Canadian LC Obligation.  Such a request by a Borrower shall be made
in compliance with all of the provisions hereof, provided that for the purposes
of the first sentence of Section 2.1(a), (b) or (c), the amount of such US
Loans or Canadian Advances shall be considered, but the amount of the Matured
US LC Obligation or Matured Canadian LC Obligation, as the case may be, to be
concurrently paid by such US Loans or such Canadian Advances shall not be
considered.

 

(c)  Participation by Lenders.  US LC Issuer and Canadian LC Issuer
irrevocably agree to grant and hereby grants to each US Lender or Canadian
Lender, respectively, and — to induce US

 

37

 

LC Issuer and Canadian LC
Issuer to issue US Letters of Credit and Canadian Letters of Credit hereunder —
each US Lender (other than, with respect to US Letters of Credit issued at the
request of Canadian Borrower, US Lenders with no continuing Canadian
Commitment) and each Canadian Lender respectively irrevocably agrees to accept
and purchase and hereby accepts and purchases from US LC Issuer or Canadian LC
Issuer, respectively, on the terms and conditions hereinafter stated and for
such Lender’s own account and risk an undivided interest equal to such US
Lender’s or such Canadian Lender’s Percentage Share of such LC Issuer’s
obligations and rights under each US Letter of Credit or Canadian Letter of
Credit, respectively, issued hereunder and the amount of each Matured US LC
Obligation or Matured Canadian LC Obligation, respectively, paid by such LC
Issuer thereunder.  Each US Lender and
each Canadian Lender unconditionally and irrevocably agrees with US LC Issuer
and Canadian LC Issuer, respectively, 
that, if a Matured US LC Obligation or Matured Canadian LC Obligation is
paid under any Letter of Credit for which such LC Issuer is not reimbursed in
full by the Borrower that requested such Letter of Credit in accordance with
the terms of this Agreement and the related LC Application (including any reimbursement
by means of concurrent Loans or Canadian Advances or by the application of
funds held by Agents and applied to LC Obligations as they mature), such US
Lender or Canadian Lender shall (in all circumstances and without set-off or
counterclaim) pay to US LC Issuer or Canadian LC Issuer, respectively, on
demand, in immediately available funds at such LC Issuer’s address for notices
hereunder, such US Lender’s or such Canadian Lender’s Percentage Share of such
respective Matured US LC Obligation or Matured Canadian LC Obligation (or any
portion thereof which has not been reimbursed by such Borrower).  Each Lender’s obligation to pay an LC Issuer
pursuant to the terms of this subsection is irrevocable and unconditional.  If any amount required to be paid by any
Lender to an LC Issuer pursuant to this subsection is paid by such Lender to
such LC Issuer within three Business Days after the date such payment is due,
such LC Issuer shall in addition to such amount be entitled to recover from
such Lender, on demand, interest thereon calculated from such due date at the
Federal Funds Rate, as to US Lenders, and at the “Bank Rate” as set by the Bank
of Canada, as quoted on Reuters page BOCFAD, as to Canadian Lenders.  If any amount required to be paid by any
Lender to an LC Issuer pursuant to this subsection is not paid by such Lender
to such LC Issuer within three Business Days after the date such payment is
due, such LC Issuer shall in addition to such amount be entitled to recover
from such Lender, on demand, interest thereon calculated from such due date at
the Base Rate, as to US Lenders, or at the Canadian Prime Rate, as to Canadian
Lenders, plus in each case the Applicable Margin.

 

(d)  Distributions to Participants.  Whenever an LC Issuer has in accordance with
this section received from any Lender payment of such Lender’s Percentage Share
of any Matured US LC Obligation or Matured Canadian LC Obligation, if such LC
Issuer thereafter receives any payment of such Matured US LC Obligation or
Matured Canadian LC Obligation or any payment of interest thereon (whether
directly from the Borrower that requested such Letter of Credit or otherwise,
and excluding only interest for any period prior to such LC Issuer’s demand
that such Lender make such payment of its Percentage Share), such LC Issuer
will distribute to such Lender its Percentage Share of the amounts so received
by such LC Issuer; provided, however, that if any such payment
received by an LC Issuer must thereafter be returned by such LC Issuer, such
Lender shall return to such LC Issuer the portion thereof which such LC Issuer
has previously distributed to it.

 

38

 

(e)  Calculations.  A written advice setting forth in reasonable
detail the amounts owing under this section, submitted by an LC Issuer to the
appropriate Borrower or any US Lender from time to time, shall be conclusive,
absent manifest error, as to the amounts thereof.

 

Section 2.13.  Letter of Credit Fees.

 

(a)  US Letter of Credit Fees.  In consideration of US LC Issuer’s issuance
of any US Letter of Credit, US Borrower or Canadian Borrower requesting such
Letter of Credit agrees to pay (i) to Administrative Agent for the account of
each US Lender in proportion to its Percentage Share, a US Letter of Credit fee
equal to the US Letter of Credit Fee Rate applicable each day times the undrawn
face amount of such US Letter of Credit and (ii) to such US LC Issuer for its
own account, a letter of credit fronting fee at a rate equal to one-eighth
percent (.125%) per annum times the undrawn face amount of such US Letter of
Credit.

 

(b) Canadian
Letter of Credit Fees.  In
consideration of Canadian LC Issuer’s issuance of any Canadian Letter of
Credit, Canadian Borrower agrees to pay (i) to Canadian Administrative Agent
for the account of each Canadian Lender in proportion to its Percentage Share,
a Canadian Letter of Credit fee equal to the Canadian Letter of Credit Fee Rate
applicable each day times the undrawn face amount of such Canadian Letter of
Credit and (ii) to such Canadian LC Issuer for its own account, a letter of
credit fronting fee at a rate equal to one-eighth percent (.125%) per annum
times the undrawn face amount of such Canadian Letter of Credit.

 

(c)  Each such fee will be calculated on the undrawn
face amount of each Letter of Credit outstanding on each day at the above
applicable rates and will be payable quarterly in arrears on the last day of
each March, June, September and December. 
In addition, each Borrower will pay to an LC Issuer a minimum
administrative issuance fee and such other fees and charges customarily charged
by such LC Issuer in respect of any issuance, amendment or negotiation of any
Letter of Credit requested by such Borrower in accordance with such LC Issuer’s
published schedule of such charges effective as of the date of such amendment
or negotiation.

 

39

 

Section 2.14.  No Duty to Inquire.

 

(a)  Drafts and Demands.  Each LC Issuer is authorized and instructed
to accept and pay drafts and demands for payment under any Letter of Credit
without requiring, and without responsibility for, any determination as to the
existence of any event giving rise to said draft, either at the time of
acceptance or payment or thereafter.  No
LC Issuer is under any duty to determine the proper identity of anyone
presenting such a draft or making such a demand (whether by tested telex or
otherwise) as the officer, representative or agent of any beneficiary under any
Letter of Credit, and payment by an LC Issuer to any such beneficiary when
requested by any such purported officer, representative or agent is hereby
authorized and approved.  Each Borrower
releases each Lender Party from, and agrees to hold each Lender Party harmless
and indemnified against, any liability or claim in connection with or arising
out of the subject matter of this section, which
indemnity shall apply whether or not any such liability or claim is in any way
or to any extent caused, in whole or in part, by any negligent act or omission
of any kind by any Lender Party, provided only that no Lender Party
shall be entitled to indemnification for that portion, if any, of any liability
or claim which is proximately caused by its own individual gross negligence or
willful misconduct, as determined in a final judgment.

 

(b)  Extension of Maturity.  If the maturity of any Letter of Credit is
extended by its terms or by Law or governmental action, if any extension of the
maturity or time for presentation of drafts or any other modification of the
terms of any Letter of Credit is made at the request of any Borrower, or if the
amount of any Letter of Credit is increased at the request of any Borrower,
this Agreement shall be binding upon all Restricted Persons with respect to
such Letter of Credit as so extended, increased or otherwise modified, with
respect to drafts and property covered thereby, and with respect to any action
taken by the LC Issuer, LC Issuer’s correspondents, or any Lender Party in
accordance with such extension, increase or other modification.

 

(c)  Transferees of Letters of Credit.  If any Letter of Credit provides that it is
transferable, the LC Issuer thereof shall have no duty to determine the proper
identity of anyone appearing as transferee of such Letter of Credit, nor shall
such LC Issuer be charged with responsibility of any nature or character for
the validity or correctness of any transfer or successive transfers, and
payment by such LC Issuer to any purported transferee or transferees as
determined by such LC Issuer is hereby authorized and approved, and each
Borrower releases each Lender Party from, and agrees to hold each Lender Party
harmless and indemnified against, any liability or claim in connection with or
arising out of the foregoing, which indemnity shall apply
whether or not any such liability or claim is in any way or to any extent
caused, in whole or in part, by any negligent act or omission of any kind by
any Lender Party, provided only that no Lender Party shall be entitled to
indemnification for that portion, if any, of any liability or claim which is
proximately caused by its own individual gross negligence or willful
misconduct, as determined in a final judgment.

 

Section 2.15.  Creation of Bankers’ Acceptances.  Upon receipt of a Borrowing Notice
requesting a Borrowing by way of Bankers’ Acceptances, and subject to the
provisions of this Agreement, each Canadian Lender shall accept, in accordance
with its Percentage Share of the

 

40

 

requested Borrowing from time
to time such Bankers’ Acceptances as Canadian Working Capital Borrower shall
request provided that:

 

(a)  Bankers’ Acceptances shall
be issued on a Business Day;

 

(b)  each Bankers’ Acceptance
shall have a term of one, two, three or six months (excluding days of grace),
as selected by Canadian Working Capital Borrower in the relevant Borrowing
Notice provided that each Bankers’ Acceptance shall mature on a Business Day;

 

(c)  the face amount of each
Bankers’ Acceptance shall be not less than C$500,000 and in multiples of
C$100,000 for any amounts in excess thereof; and

 

(d)  each Bankers’ Acceptance
shall be in a form acceptable to the Canadian Administrative Agent.

 

Section 2.16.  Terms of Acceptance by Canadian Lenders.

 

(a)  Delivery and Payment.  Subject to Sections 2.17 and 2.18 and only
if a valid appointment pursuant to Section 2.16(d) is not in place, Canadian
Working Capital Borrower shall pre-sign and deliver to each Canadian Lender
bankers’ acceptance drafts in sufficient quantity to meet Canadian Working
Capital Borrower’s requirements for anticipated Borrowings by way of Bankers’
Acceptances.  Canadian Working Capital
Borrower shall, at its option, provide for payment to Canadian Administrative
Agent for the benefit of Canadian Lenders of each Bankers’ Acceptance on the
date on which a Bankers’ Acceptance matures, either by payment of the full face
amount thereof or through utilization of a Conversion to another Type of
Borrowing in accordance with this Agreement, or through a combination
thereof.  Canadian Working Capital
Borrower waives presentment for payment of Bankers’ Acceptances by Canadian
Lenders and shall not claim from Canadian Lenders any days of grace for the
payment at maturity of Bankers’ Acceptances. 
Any amount owing by Canadian Working Capital Borrower in respect of any
Bankers’ Acceptance which is not paid in accordance with the foregoing, shall,
as and from the date on which such Bankers’ Acceptance matures, be deemed to be
outstanding hereunder as a Canadian Prime Rate Loan.

 

(b)  No Liability.  Canadian Administrative Agent and Canadian
Lenders shall not be liable for any damage, loss or improper use of any
bankers’ acceptance draft endorsed in blank except for any loss arising by
reason of Canadian Administrative Agent or a Canadian Lender failing to use the
same standard of care in the custody of such bankers’ acceptance drafts as
Canadian Administrative Agent or such Canadian Lender use in the custody of
their own property of a similar nature.

 

(c)  Bankers’ Acceptances Purchased by
Canadian Lenders.  Each Canadian
Lender shall purchase Bankers’ Acceptances accepted by it for an amount equal
to the Discount Proceeds.

 

(d)  Power of Attorney.  To facilitate the procedures contemplated in
this Agreement, Canadian Working Capital Borrower appoints each Canadian Lender
from time to time as the attorney-in-fact of Canadian Working Capital Borrower
to execute, endorse and deliver on behalf of Canadian Working Capital Borrower
drafts or depository bills in the form or forms prescribed

 

41

 

by such Canadian Lender for
Bankers’ Acceptances denominated in Canadian Dollars.  Each Bankers’ Acceptance executed and delivered by a Canadian
Lender on behalf of Canadian Working Capital Borrower shall be as binding upon
such Canadian Working Capital Borrower as if it had been executed and delivered
by a duly authorized officer of such Canadian Working Capital Borrower.  The foregoing appointment shall cease to be
effective, in respect of any Canadian Lender regarding Canadian Working Capital
Borrower, three Business Days following receipt by such Canadian Lender of a
written notice from Canadian Working Capital Borrower revoking such appointment
(which notice shall be copied to the Canadian Administrative Agent); provided
that any such revocation shall not affect Bankers’ Acceptances previously
executed and delivered by such Canadian Lender pursuant to such appointment.

 

(e)  Pro-Rata Treatment of Canadian Advances.

 

(i)  Each Canadian Advance shall
be made available by each Canadian Lender and all repayments and reductions in
respect thereof shall be made and applied in a manner so that the Canadian
Advances outstanding hereunder to each Canadian Lender will, to the extent
possible, thereafter be pro rata in accordance with such Canadian Lender’s
Percentage Share.  The Canadian
Administrative Agent is authorized by Canadian Working Capital Borrower and
each Canadian Lender to determine, in its sole and unfettered discretion, the
portion of each Canadian Advance and each Type of Canadian Advance to be made
available by each Canadian Lender and the application of repayments and
reductions of Canadian Advances to give effect to the provisions of this
section, provided that no Canadian Lender shall, as a result of any such
determination, have a Percentage Share of the Canadian Advances which is in
excess of its Percentage Share of the Canadian Working Capital Commitment.

 

(ii)  In the event it is not
practicable to allocate Bankers’ Acceptances to each Canadian Lender such that
the aggregate amount of Bankers’ Acceptances required to be purchased by such
Canadian Lender hereunder is in a whole multiple of C$100,000, the Canadian
Administrative Agent is authorized by each Canadian Working Capital Borrower
and each Canadian Lender to make such allocation as the Canadian Administrative
Agent determines in its sole and unfettered discretion may be equitable in the
circumstances and, if the aggregate amount of such Bankers’ Acceptances is not
a whole multiple of C$100,000, then the Canadian Administrative Agent may
allocate (on a basis considered by it to be equitable) the excess of such
Canadian Advance over the next lowest whole multiple of C$100,000 to one
Canadian Lender, which shall purchase a Bankers’ Acceptance with a face amount
equal to the excess and having the same term as the corresponding Bankers’
Acceptances.  In no event shall the
portion of the outstanding Borrowings by way of Bankers’ Acceptances of a
Canadian Lender exceed such Canadian Lenders’ Percentage Share of the aggregate
Borrowings by way of Bankers’ Acceptances by more than C$100,000 as a result of
such exercise of discretion by the Canadian Administrative Agent.

 

(f)  BA Equivalent Advances.  Each Canadian Lender may, in lieu of
accepting a BA on the date of any Borrowing, make a BA Equivalent Advance.  The amount of each BA Equivalent Advance
shall be equal to the Discount Proceeds (with reference to the applicable BA
Discount Rate) which would be realized from a hypothetical sale of those BAs
which, but for this subsection, would have been sold to such Canadian
Lender.  If such Canadian Lender does
not

 

42

 

otherwise have a BA Discount
Rate applicable to it, the applicable BA Discount Rate will be calculated as
though such Canadian Lender was listed on Schedule II of the Bank Act (Canada).  Any BA Equivalent Advance shall be made on
the relevant date of any Borrowing, and shall remain outstanding for the term
of the corresponding BA.  On the
maturity date of the corresponding BA, such BA Equivalent Advance shall be
repaid in an amount equal to the face amount of a draft that would have been
accepted by such Canadian Lender if such Canadian Lender had accepted and
purchase BA hereunder.  Each BA
Equivalent Advance made pursuant to this subsection shall be deemed to be a BA
accepted and purchased by such Canadian Lender pursuant to the terms hereof,
and except in this subsection, any reference to a BA shall include such BA
Equivalent Advance.

 

Section 2.17.  General Procedures for Bankers’
Acceptances.

 

(a)  Continuations.  In the case of a Continuation of maturing
Bankers’ Acceptances, each Canadian Lender in order to satisfy the continuing
liability of Canadian Working Capital Borrower to the Canadian Lender for the
face amount of the maturing Bankers’ Acceptances, shall retain for its own
account the Net Proceeds of each new Bankers’ Acceptance issued by it in
connection with such Continuation; and Canadian Working Capital Borrower shall,
on the maturity date of the maturing Bankers’ Acceptances, pay to Canadian
Administrative Agent for the benefit of Canadian Lenders an amount equal to the
difference between the face amount of the maturing Bankers’ Acceptances and the
aggregate Net Proceeds of the new Bankers’ Acceptances.

 

(b)  Conversion from Canadian Prime Rate Loans
or Canadian US Dollar Base Rate Loans. 
In the case of a Conversion from a Borrowing of Canadian Prime Rate
Loans or Canadian US Dollar Base Rate Loans into a Borrowing by way of Bankers’
Acceptances to be accepted by a Canadian Lender pursuant to Section 2.16, such
Canadian Lender, in order to satisfy the continuing liability of Canadian
Working Capital Borrower to it for the principal amount of the Canadian Prime Rate
Loans or Canadian US Dollar Base Rate Loans being converted, shall retain for
its own account the Discount Proceeds of each new Bankers’ Acceptance issued by
it in connection with such Conversion; and Canadian Working Capital Borrower
shall, on the date of issuance of the Bankers’ Acceptances, pay to Canadian
Administrative Agent for the benefit of Canadian Lenders an amount equal to the
difference between the aggregate principal amount of the Canadian Prime Rate
Loans or Canadian US Dollar Base Rate Loans being converted owing to the
Canadian Lenders and the aggregate Discount Proceeds of such Bankers’
Acceptances.

 

(c)  Authorization.  Canadian Working Capital Borrower hereby
authorizes each Canadian Lender to complete, stamp, hold, sell, rediscount or
otherwise dispose of all Bankers’ Acceptances accepted by it pursuant to this
section in accordance with the instructions provided by Canadian Working
Capital Borrower pursuant to Section 2.3, as applicable.

 

(d)  Depository Notes.  The parties agree that in the administering
of Bankers’ Acceptances, each Canadian Lender may avail itself of the debt
clearing services offered by a clearing house for depository notes pursuant to
the Depository Bills and Notes Act (Canada) and that the procedures set forth in
Article II be deemed amended to the extent necessary to comply with the
requirements of such debt clearing services.

 

43

 

Section 2.18.  Execution of Bankers’ Acceptances.  The signatures of any authorized signatory
on Bankers’ Acceptances which are authorized and requested hereunder by the
Canadian Working Capital Borrower may, at the option of Canadian Working
Capital Borrower, be reproduced in facsimile and such Bankers’ Acceptances
bearing such facsimile signatures shall be binding on Canadian Working Capital
Borrower as if they had been manually signed by such authorized signatory.  Notwithstanding that any person whose
signature appears on any Bankers’ Acceptance as a signatory may no longer be an
authorized signatory of Canadian Working Capital Borrower at the date of
issuance of a Bankers’ Acceptance, and notwithstanding that the signature
affixed may be a reproduction only, such signature shall, unless prior to its
use the Canadian Working Capital Borrower has notified the Canadian
Administrative Agent in writing to contrary, nevertheless be valid and
sufficient for all purposes as if such authority had remained in force at the
time of such issuance and as if such signature had been manually applied, and
any such Bankers’ Acceptance so signed shall be binding on Canadian Working
Capital Borrower.

 

Section 2.19.  Prepayment of Bankers’ Acceptances.  Any amounts received by Canadian
Administrative Agent to be applied to outstanding Bankers’ Acceptances, whether
pursuant to an Event of Default and acceleration of the Obligations under
Section 8.1 or a prepayment as permitted or required under Section 2.8 or 2.9,
shall be deposited into an escrow account maintained by and in the name of
Canadian Administrative Agent for the benefit of Canadian Lenders for set-off
against such outstanding Bankers’ Acceptances as they mature, and pending such
application shall bear interest at the rate declared by Canadian Administrative
Agent from time to time as that payable by it in respect of deposits for such
amount and for such period relative to the maturity date of such Bankers’
Acceptances, as applicable.  Upon the
repayment of all such outstanding Bankers’ Acceptances, any amounts remaining
(including accrued interest) will (i) during the continuance of an Event of
Default, be subject to such remedies as each Lender Party may have hereunder or
under applicable Law, or (ii) otherwise, be released to Canadian Borrower.

 

ARTICLE III - Payments to Lenders

 

Section 3.1.  General Procedures.

 

(a)  Each Restricted Person shall pay all amounts
owing by such Restricted Person with respect to any US Obligations (whether for
principal, interest, fees, or otherwise) to Administrative Agent for the
account of the US Lender Party to whom such payment is owed in Dollars, without
set-off, deduction or counterclaim, and in immediately available funds and each
Restricted Person shall pay all amounts owing by such Restricted Person with
respect to any Canadian Obligations (whether for principal, interest, fees, or
otherwise) to Canadian Administrative Agent for the account of the Canadian
Lender Party to whom such payment is owed in Canadian Dollars (or with respect
to Canadian Loans funded in Dollars, in Dollars), without set-off, deduction or
counterclaim, and in immediately available funds.  If any payment is received on account of any US Obligation in any
currency other than Dollars (whether voluntarily or pursuant to any order or
judgment or the enforcement thereof or the realization of any security or the
liquidation of any Person or otherwise howsoever), such payment shall
constitute a discharge of the liability of a Restricted Person hereunder and
under the other Loan Documents in respect of such US Obligation only to the
extent of the amount of Dollars which the relevant Lender Parties are able to
purchase with the amount of the other currency received by it on the Business
Day next following such receipt by the Administrative Agent in accordance

 

44

 

with its normal procedures and
after deducting any premium and costs of exchange. If any payment is received
on account of any Canadian Obligation in any currency other than Canadian
Dollars (whether voluntarily or pursuant to any order or judgment or the
enforcement thereof or the realization of any security or the liquidation of
any Person or otherwise howsoever), such payment shall constitute a discharge
of the liability of a Restricted Person hereunder and under the other Loan
Documents in respect of such Canadian Obligation only to the extent of the
amount of Canadian Dollars which the relevant Lender Parties are able to
purchase with the amount of the other currency received by it on the Business
Day next following such receipt by Canadian Administrative Agent in accordance
with its normal procedures and after deducting any premium and costs of
exchange.  Each payment under the Loan
Documents must be received by the relevant Agent not later than noon, Boston,
Massachusetts time or Toronto, Ontario time, as the case may be, on the date
such payment becomes due and payable. Any payment received by the relevant
Agent after such time will be deemed to have been made on the next following
Business Day.  Should any such payment
become due and payable on a day other than a Business Day, the maturity of such
payment shall be extended to the next succeeding Business Day, and, in the case
of a payment of principal or past due interest, interest shall accrue and be
payable thereon for the period of such extension as provided in the Loan
Document under which such payment is due. 
Each payment under a Loan Document to a US Lender Party shall be due and
payable at the place provided therein and, if no specific place of payment is
provided, shall be due and payable at the place of payment of Administrative
Agent’s US Note.  Each Payment under a
Loan Document to a Canadian Lender Party shall be due and payable at the place
provided therein, and, if no specific place of payment is provided, shall be
due and payable at the place of payment in Canadian Administrative Agent’s
Canadian Working Capital Note.

 

(b)  When Administrative Agent collects or
receives money on account of the US Obligations, Administrative Agent shall
distribute all money so collected or received, and each US Lender Party shall
apply all such money so distributed, as follows:

 

(i)  first, for the payment of
all US Obligations which are then due (and if such money is insufficient to pay
all such US Obligations, first to any reimbursements due Administrative Agent
under Section 10.4 and then to the partial payment of all other US Obligations
then due in proportion to the amounts thereof, or as US Lender Parties shall
otherwise agree);

 

(ii)  then for the prepayment of
amounts owing under the Loan Documents (other than principal on the US Notes
and Canadian Notes) if so specified by US Borrower;

 

(iii)  then for the prepayment
of principal on the US Notes and Canadian Notes, together with accrued and
unpaid interest on the principal so prepaid, or held by US LC Issuer and
applied to US LC Obligations as they mature; and

 

(iv)  last, for the payment or
prepayment of any other US Obligations.

 

All payments applied to
principal or interest on any US Note or Canadian Note shall be applied first to
any interest then due and payable, then to principal then due and payable, and
last to any prepayment of principal and accrued interest thereon in compliance
with Sections 2.8 and 2.9, as applicable. 
All distributions of amounts described in any of subsections (ii),
(iii), or (iv) above shall be made by Administrative Agent pro rata to each US
Lender Party then owed US Obligations described in such subsection in
proportion to all amounts owed to all US Lender

 

45

 

Parties which are described in
such subsection; provided that if any US Lender then owes payments to US LC
Issuer for the purchase of a participation under Section 2.12(c) or to
Administrative Agent under Section 9.4, any amounts otherwise distributable
under this section to such US Lender shall be deemed to belong to US LC Issuer,
or Administrative Agent, respectively, to the extent of such unpaid payments,
and Administrative Agent shall apply such amounts to make such unpaid payments
rather than distribute such amounts to such US Lender.

 

(c)  When Canadian Administrative Agent collects
or receives money on account of the Canadian Obligations, other than as
provided in Section 3.9, Canadian Administrative Agent shall distribute all
money so collected or received, and each Canadian Lender Party shall apply all
such money so distributed, as follows:

 

(i)  first, for the payment of
all Canadian Obligations which are then due (and if such money is insufficient
to pay all such Canadian Obligations, first to any reimbursements due Canadian
Administrative Agent under 10.4 and then to the partial payment of all other
Canadian Obligations then due in proportion to the amounts thereof, or as
Canadian Lender Parties shall otherwise agree);

 

(ii)  then for the prepayment of
amounts owing under the Loan Documents (other than principal on the Canadian
Working Capital Notes) if so specified by Canadian Working Capital Borrower;

 

(iii)  then for the prepayment
of principal on the Canadian Working Capital Notes, together with accrued and
unpaid interest on the principal so prepaid, or held by Canadian LC Issuer and
applied to Canadian LC Obligations as they mature; and

 

(iv)  last, for the payment or
prepayment of any other Canadian Obligations.

 

All payments applied to principal
or interest on any Canadian Working Capital Note shall be applied first to any
interest then due and payable, then to principal then due and payable, and last
to any prepayment of principal and accrued interest thereon in compliance with
Sections 2.8 and 2.9, as applicable. 
All distributions of amounts described in any of subsections (ii),
(iii), or (iv) above shall be made by Canadian Administrative Agent pro rata to
each Canadian Lender Party then owed Canadian Obligations described in such
subsection in proportion to all amounts owed to all Canadian Lender Parties
which are described in such subsection; provided that if any Canadian  Lender then owes payments to Canadian LC
Issuer for the purchase of a participation under Section 2.12(c) or to Canadian
Administrative Agent under Section 9.4, any amounts otherwise distributable
under this section to such Canadian Lender shall be deemed to belong to
Canadian LC Issuer, or Canadian Administrative Agent, respectively, to the
extent of such unpaid payments, and Canadian Administrative Agent shall apply
such amounts to make such unpaid payments rather than distribute such amounts
to such Canadian Lender.

 

Section 3.2.  Capital Reimbursement.  If either (a) the introduction or
implementation of or the compliance with or any change in or in the
interpretation of any Law, or (b) the introduction or implementation of or the
compliance with any request, directive or guideline from any central bank or
other governmental authority (whether or not having the force of Law) affects
or would affect the amount of capital required or expected to be maintained by
any Lender Party or any corporation controlling any Lender Party, then, within
five Business Days after

 

46

 

demand by such Lender Party,
the relevant Borrower will pay to the relevant Agent for the benefit of such
Lender Party, from time to time as specified by such Lender Party, such
additional amount or amounts which such Lender Party shall determine to be appropriate
to compensate such Lender Party or any corporation controlling such Lender
Party in light of such circumstances, to the extent that such Lender Party
reasonably determines that the amount of any such capital would be increased or
the rate of return on any such capital would be reduced by or in whole or in
part based on the existence of the face amount of such Lender Party’s Loans,
Letters of Credit, participations in Letters of Credit, in Banker’s
Acceptances, or commitments under this Agreement.

 

Section 3.3.  Increased Cost of LIBOR Loans or Letters
of Credit.  If any applicable Law
(whether now in effect or hereinafter enacted or promulgated, including
Regulation D) or any interpretation or administration thereof by any
governmental authority charged with the interpretation or administration
thereof (whether or not having the force of Law):

 

(a)  shall change the basis of taxation of
payments to any Lender Party of any principal, interest, or other amounts
attributable to any LIBOR Loan or Letter of Credit or otherwise due under this
Agreement in respect of any LIBOR Loan or Letter of Credit (other than taxes
imposed on, or measured by, the overall net income of such Lender Party or any
Applicable Lending Office of such Lender Party by any jurisdiction in which
such Lender Party or any such Applicable Lending Office is located); or

 

(b)  shall change, impose, modify, apply or deem
applicable any reserve, special deposit or similar requirements in respect of
any LIBOR Loan or any Letter of Credit (excluding those for which such Lender
Party is fully compensated pursuant to adjustments made in the definition of
LIBOR Rate) or against assets of, deposits with or for the account of, or
credit extended by, such Lender Party; or

 

(c)  shall impose on any Lender Party or the
interbank Eurocurrency deposit market any other condition affecting any LIBOR
Loan or Letter of Credit, the result of which is to increase the cost to any
Lender Party of funding or maintaining any LIBOR Loan or of issuing any Letter
of Credit or to reduce the amount of any sum receivable by any Lender Party in
respect of any LIBOR Loan or Letter of Credit by an amount deemed by such
Lender Party to be material,

 

then such Lender Party shall
promptly notify relevant Agent and relevant Borrower in writing of the
happening of such event and of the amount required to compensate such Lender
Party for such event (on an after-tax basis, taking into account any taxes on
such compensation), whereupon (i) relevant Borrower shall, within five Business
Days after demand therefor by such Lender Party, pay such amount to relevant
Agent for the account of such Lender Party and (ii) relevant Borrower may
elect, by giving to relevant Agent and such Lender Party not less than three
Business Days’ notice, to Convert all (but not less than all) of any such LIBOR
Loans into Base Rate Loans.

 

Section 3.4.  Notice; Change of Applicable Lending
Office.  A Lender Party shall notify
the relevant Borrower of any event occurring after the date of this Agreement
that will entitle such Lender Party to compensation under Section 3.2, 3.3, or
3.5 hereof as promptly as practicable, but in any event within 180 days, after
such Lender Party obtains actual knowledge

 

47

 

thereof; provided, that
(i) if such Lender Party fails to give such notice within 180 days after it
obtains actual knowledge of such an event, such Lender Party shall, with
respect to compensation payable pursuant to Section 3.2, 3.3, or 3.5 in
respect of any costs resulting from such event, only be entitled to payment
under Section 3.2, 3.3, or 3.5 hereof for costs incurred from and after the
date 180 days prior to the date that such Lender Party does give such notice
and (ii) such Lender Party will designate a different Applicable Lending
Office for the Loans affected by such event if such designation will avoid the
need for, or reduce the amount of, such compensation and will not, in the sole
opinion of such Lender Party, be disadvantageous to such Lender Party, except
that such Lender Party shall have no obligation to designate an Applicable
Lending Office located in the United States of America.  Each Lender Party will furnish to the
relevant Borrower a certificate setting forth the basis and amount of each request
by such Lender Party for compensation under Section 3.2, 3.3, or 3.5 hereof.

 

Section 3.5.  Availability.  If (a) any change in applicable Laws, or in
the interpretation or administration thereof of or in any jurisdiction
whatsoever, domestic or foreign, shall make it unlawful or impracticable for
any Lender Party to fund or maintain LIBOR Loans, accept BA’s or to issue or
participate in Letters of Credit, or shall materially restrict the authority of
any Lender Party to purchase or take offshore deposits of dollars (i.e.,
“Eurodollars”), or (b) any Lender Party determines that matching deposits
appropriate to fund or maintain any LIBOR Loan are not available to it, or (c)
any Lender Party determines that the formula for calculating the LIBOR Rate
does not fairly reflect the cost to such Lender Party of making or maintaining
loans based on such rate, in each case with respect to the relevant Commitment
hereunder, then, upon notice by such Lender Party to the relevant Borrower and
the relevant Agent, such Borrower’s right to elect LIBOR Loans from such Lender
Party or issue BA’s (or, if applicable, to obtain Letters of Credit) shall be
suspended to the extent and for the duration of such illegality,
impracticability or restriction and all LIBOR Loans of such Lender Party which
are then outstanding and all BA’s which are then outstanding or are then the
subject of any Borrowing Notice and which cannot lawfully or practicably be
maintained, funded or accepted shall immediately become or remain, or shall be
funded as, Base Rate Loans of such Lender Party.  With respect to each Commitment, the relevant Borrower thereunder
agrees to indemnify each Lender Party extending credit pursuant thereto, and
hold each such Lender Party harmless against all costs, expenses, claims,
penalties, liabilities and damages which may result from any such change in
Law, interpretation or administration. 
Such indemnification shall be on an after-tax basis, taking into account
any taxes imposed on the amounts paid as indemnity.

 

Section 3.6.  Funding Losses.  In addition to its other obligations
hereunder, with respect to each Commitment, the relevant Borrower thereunder
will indemnify each Lender Party extending credit pursuant thereto against, and
reimburse each Lender Party on demand for, any loss or expense incurred or
sustained by such Lender Party (including any loss or expense incurred by
reason of the liquidation or reemployment of deposits or other funds acquired
by such Lender Party to fund or maintain LIBOR Loans), as a result of (a) any
payment or prepayment (whether or not authorized or required hereunder) of all
or a portion of a LIBOR Loan on a day other than the day on which the
applicable Interest Period ends, (b) any payment or prepayment, whether or not
required hereunder, of a Loan made after the delivery, but before the effective
date, of a Continuation/Conversion Notice, if such payment or prepayment
prevents such Continuation/Conversion Notice from becoming fully effective, (c)
the failure of any Loan to be made or of any Continuation/Conversion Notice to
become effective due to any condition precedent not being satisfied or due to
any other action or inaction of any Restricted Person, or

 

48

 

(d) any Conversion (whether or
not authorized or required hereunder) of all or any portion of any LIBOR Loan
into a Base Rate Loan or into a different LIBOR Loan on a day other than the
day on which the applicable Interest Period ends.  Such indemnification shall be on an after-tax basis, taking into
account any taxes imposed on the amounts paid as indemnity.

 

Section 3.7.  Reimbursable Taxes.  With respect to each Commitment, the
relevant Borrower thereunder covenants and agrees with each Lender Party
extending credit pursuant thereto that:

 

(a)  Such Borrower will indemnify each such
Lender Party against and reimburse each such Lender Party for all present and
future stamp and other taxes, duties, levies, imposts, deductions, charges,
costs, and withholdings whatsoever imposed, assessed, levied or collected on or
in respect of this Agreement, any LIBOR Loans, any BA’s or Letters of Credit
(whether or not legally or correctly imposed, assessed, levied or collected)
including all taxes imposed pursuant to Part XIII of the Income Tax Act
(Canada) and any withholding or other taxes imposed on any Lender Party under
Canadian Law, excluding, however, any taxes imposed on or measured by the
overall net income of any Agent or such Lender Party or any Applicable Lending
Office of such Lender Party by any jurisdiction in which such Lender Party or
any such Applicable Lending Office is located (all such non-excluded taxes,
levies, costs and charges being collectively called “Reimbursable Taxes” in
this section).  Such indemnification
shall be on an after-tax basis, taking into account any taxes imposed on the
amounts paid as indemnity.

 

(b)  All payments on account of the principal of,
and interest on, each such Lender Party’s Loans and Notes, and all other
amounts payable by such Borrower to any such Lender Party hereunder, shall be
made in full without set-off or counterclaim and shall be made free and clear
of and without deductions or withholdings of any nature by reason of any
Reimbursable Taxes, all of which will be for the account of the relevant
Borrower.  In the event of any such
Borrower being compelled by Law to make any such deduction or withholding from
any payment to any such Lender Party, such Borrower shall pay on the due date
of such payment, by way of additional interest, such additional amounts as are
needed to cause the amount receivable by such Lender Party after such deduction
or withholding to equal the amount which would have been receivable in the
absence of such deduction or withholding. 
If any such Borrower should make any deduction or withholding as
aforesaid, such Borrower shall within 60 days thereafter forward to such Lender
Party an official receipt or other official document evidencing payment of such
deduction or withholding.

 

(c)  If any such Borrower is ever required to pay
any Reimbursable Tax with respect to any LIBOR Loan, such Borrower may elect,
by giving to the relevant Agent and such Lender Party not less than three
Business Days’ notice, to Convert all (but not less than all) of any such LIBOR
Loan into a Base Rate Loan, but such election shall not diminish such
Borrower’s obligation to pay all Reimbursable Taxes.

 

(d)  Notwithstanding the foregoing provisions of
this section, such Borrower shall be entitled, to the extent it is required to
do so by Law, to deduct or withhold (and not to make any indemnification or
reimbursement for) income or other similar taxes imposed by the United States
of America or Canada (other than any portion thereof attributable to a change
in federal income tax Laws effected after the date hereof) from interest, fees
or other amounts payable hereunder for the account of such Lender Party, other
than such a Lender Party (i) who is a US

 

49

 

person for Federal income tax
purposes or (ii) who has the Prescribed Forms on file with Administrative
Agent (with copies provided to the relevant Borrower) for the applicable year
to the extent deduction or withholding of such taxes is not required as a
result of the filing of such Prescribed Forms, provided that if such Borrower
shall so deduct or withhold any such taxes, it shall provide a statement to
Administrative Agent and such Lender Party, setting forth the amount of such
taxes so deducted or withheld, the applicable rate and any other information or
documentation which such Lender Party may reasonably request for assisting such
Lender Party to obtain any allowable credits or deductions for the taxes so
deducted or withheld in the jurisdiction or jurisdictions in which such Lender
Party is subject to tax.  As used in
this section, “Prescribed Forms” means such duly executed forms or statements,
and in such number of copies, which may, from time to time, be prescribed by
Law and which, pursuant to applicable provisions of (x) an income tax treaty
between the United States and the country of residence of such Lender Party
providing the forms or statements, (y) the Code, or (z) any applicable rules or
regulations thereunder, permit such Borrower to make payments hereunder for the
account of such Lender Party free of such deduction or withholding of income or
similar taxes.

 

Section 3.8.  Replacement of Lenders.  If any Lender Party seeks reimbursement for
increased costs under Sections 3.2 through 3.7, then within ninety days
thereafter — provided no Event of Default then exists — each Borrower shall
have the right (unless such Lender Party withdraws its request for additional
compensation) to replace such Lender Party by requiring such Lender Party to
assign its Loans and Notes and its commitments hereunder to an Eligible
Transferee reasonably acceptable to Administrative Agent and to the relevant
Borrower, provided that:  (i) all
Obligations of such Borrower owing to such Lender Party being replaced (including
such increased costs and any breakage costs with respect to any outstanding
LIBOR Loans, but excluding principal and accrued interest on the Notes being
assigned) shall be paid in full to such Lender Party concurrently with such
assignment, and (ii) the replacement Eligible Transferee shall purchase
the Notes being assigned by paying to such Lender Party a price equal to the
principal amount thereof plus accrued and unpaid interest and accrued and
unpaid commitment fees thereon.  In
connection with any such assignment the relevant Borrower, Administrative
Agent, such Lender Party and the replacement Eligible Transferee shall
otherwise comply with Section 10.5. 
Notwithstanding the foregoing rights of each Borrower under this
section, however, Borrowers may not replace any Lender Party which seeks
reimbursement for increased costs under Section 3.2 through 3.7 unless
such Borrower is at the same time replacing all Lender Parties which are then
seeking such compensation.

 

Section 3.9.  Currency Conversion and Indemnity.

 

(a)  If, for the purpose of obtaining or
enforcing judgment in any court in any jurisdiction, it becomes necessary to
convert into a particular currency (the “Judgment Currency”) any amount due
under a Loan Document in the currency in which it was effected (the “Agreed
Currency”) then the conversion shall be made on the basis of the rate of
exchange prevailing on the Business Day preceding the date such judgment is
given and in any event each Restricted Person obligated to pay such Obligation
shall be obligated to pay the relevant Lender Parties any deficiency in
accordance with Section 3.9(b).  For the
foregoing purposes “rate of exchange” means the rate at which the relevant
Agent, as applicable, in accordance with its normal banking procedures is able
on the relevant date to purchase the Agreed Currency with the Judgment Currency
after deducting any premium and costs of exchange.

 

50

 

(b)  If any Lender Party receives any payment or
payments on account of the liability of a Restricted Person under the Loan
Documents pursuant to any judgment or order in any currency other than the
Agreed Currency (an “Other Currency”), and  the amount of the Agreed
Currency which the relevant Lender Party is able to purchase on the Business
Day next following such receipt with the proceeds of such payment or payments
in accordance with its normal procedures and after deducting any premiums and
costs of exchange is less than the amount of the Agreed Currency due in respect
of such Obligations immediately prior to such judgment or order, then the
Borrower owing such Obligation on demand shall, and such Borrower hereby agrees
to, indemnify and save such Lender Party harmless from and against any loss,
cost or expense arising out of or in connection with such deficiency.  The agreement of indemnity provided for in
this Section 3.9(b) shall constitute an obligation separate and independent
from all other obligations contained in this Agreement, shall give rise to a
separate and independent cause of action, shall apply irrespective of any
indulgence granted by the Lender Parties or any of them from time to time, and
shall continue in full force and effect notwithstanding any judgment or order
for a liquidated sum in respect of an amount due hereunder or under any
judgment or order.

 

ARTICLE IV - Conditions Precedent to
Lending

 

Section 4.1.  Documents to be Delivered.  No Lender has any obligation to make its
first Loan, and no LC Issuer has any obligation to issue the first Letter of
Credit, unless Administrative Agent shall have received all of the following,
at Administrative Agent’s office in Boston, Massachusetts, duly executed and
delivered and in form, substance and date satisfactory to Administrative Agent,
each of which was so executed and delivered:

 

(a)  This Agreement and any
other document that Lenders are to execute in connection herewith.

 

(b)  Each Note and the guaranty of each
Guarantor.

 

(c)  Certain certificates
including:

 

(i)  An “Omnibus Certificate” of
the secretary or assistant secretary and any vice president of GP LLC, which
shall contain the names and signatures of the officers of GP LLC authorized to
execute Loan Documents and which shall certify to the truth, correctness and
completeness of the following exhibits attached thereto:  (1) a copy of resolutions duly adopted by
the Board of Directors of GP LLC and in full force and effect at the time this
Agreement is entered into, authorizing the execution of this Agreement and the
other Loan Documents delivered or to be delivered in connection herewith and
the consummation of the transactions contemplated herein and therein, (2) a
copy of the charter documents of US Borrower and all amendments thereto,
certified by the appropriate official of its jurisdiction of organization, and
(3) a copy of the agreement of limited partnership of US Borrower;

 

(ii)  An “Omnibus Certificate”
of the secretary or assistant secretary and any vice president of Plains
Marketing GP Inc., which shall contain the names and signatures of the officers
of such company authorized to execute Loan Documents and which shall certify to
the truth, correctness and completeness of the following

 

51

 

exhibits
attached thereto:  (1) a copy of
resolutions duly adopted by the Board of Directors of such company and in full
force and effect at the time this Agreement is entered into, authorizing the
execution of this Agreement and the other Loan Documents delivered or to be
delivered in connection herewith and the consummation of the transactions
contemplated herein and therein, (2) a copy of the charter documents of each
Significant Restricted Person, other than those Significant Restricted Persons
whose charter documents are attached to the certificates described in Section
4.1(c)(i) above or Section 4.1(c)(iii) below and all amendments thereto,
certified by the appropriate official of its jurisdiction of organization, and
(3) a copy of any bylaws or agreement of limited partnership of such
Significant Restricted Persons;

 

(iii)  An “Omnibus Certificate”
of the secretary or assistant secretary and any vice president of Canadian
Borrower, which shall contain the names and signatures of the officers of
Canadian Borrower authorized to execute Loan Documents and which shall certify
to the truth, correctness and completeness of the following exhibits attached
thereto:  (1) a copy of resolutions duly
adopted by the Board of Directors of Canadian Borrower and in full force and
effect at the time this Agreement is entered into, authorizing the execution of
this Agreement and the other Loan Documents delivered or to be delivered in
connection herewith and the consummation of the transactions contemplated
herein and therein, (2) a copy of the charter documents of Canadian Borrower
and Canadian Working Capital Borrower and all amendments thereto, certified by
the appropriate official of its jurisdiction of organization, and (3) a copy of
the bylaws of Canadian Borrower and the agreement of limited partnership of
Canadian Working Capital Borrower; and

 

(iv)  A certificate of the chief
financial officer of GP LLC, regarding satisfaction of Section 4.2.

 

(d)  A certificate (or
certificates) of the due formation, valid existence and good standing of each
Significant Restricted Person in its respective jurisdiction of organization,
issued by the appropriate authorities of such jurisdiction.

 

(e)  Favorable opinions of Tim
Moore, Esq., General Counsel for Restricted Persons, substantially in the form
set forth in Exhibit E-1, Fulbright & Jaworski L.L.P., special Texas and
New York counsel to Restricted Persons, substantially in the form set forth in
Exhibit E-2, and Bennett Jones LLP, special Canadian Counsel for Restricted
Persons, substantially in the form set forth in Exhibit E-3.

 

(f) Financial projections for US Borrower and its Subsidiaries through
December 2006, in form and substance reasonably satisfactory to Administrative
Agent.

 

(g)  Consolidated financial
statements of US Borrower and its Subsidiaries as of September 30, 2003,
reflecting compliance with Sections 7.8 and 7.9, together with a
certificate by the chief financial officer of GP LLC certifying such financial
statements.

 

(h)  No Material Adverse Change
shall have occurred since December 31, 2002.

 

52

 

(i)  Administrative Agent shall
have received all documents and instruments which Administrative Agent has then
requested (including opinions of legal counsel for Restricted Persons and
Administrative Agent; corporate documents and records; documents evidencing
governmental authorizations, consents, approvals, licenses and exemptions; and
certificates of public officials and of officers and representatives of
Borrowers and other Persons), as to (i) the accuracy and validity of or
compliance with all representations, warranties and covenants made by any
Restricted Person in this Agreement and the other Loan Documents, (ii) the
satisfaction of all conditions contained herein or therein, and (iii) all other
matters pertaining hereto and thereto. 
All such additional documents and instruments shall be satisfactory to
Administrative Agent in form and substance.

 

(j)  Payment of all commitment,
facility, agency and other fees required to be paid to any Agent or Lender
pursuant to any Loan Documents or any commitment agreement heretofore entered
into.

 

(k)  Evidence of the payment in
full of all outstanding Indebtedness under the Existing Agreements, the release
of all Liens securing such Indebtedness, and termination of the Existing
Agreements.

 

Section 4.2.  Additional Conditions Precedent.  No Lender has any obligation to make any
Loan (including its first), and no LC Issuer has any obligation to issue any
Letter of Credit (including its first), unless the following conditions
precedent have been satisfied:

 

(a)  All representations and
warranties made by any Restricted Person in any Loan Document shall be true on
and as of the date of such Loan or the date of issuance of such Letter of
Credit as if such representations and warranties had been made as of the date
of such Loan or the date of issuance of such Letter of Credit except to the
extent that such representation or warranty was made as of a specific date or
updated, modified or supplemented as of a subsequent date with the consent of
Majority Lenders, then in each such case, such other date.

 

(b)  No Default shall exist at
the date of such Loan or the date of issuance of such Letter of Credit or
result from such Loan or such issuance of such Letter of Credit.

 

ARTICLE V - Representations and Warranties

 

To confirm
each Lender’s understanding concerning Restricted Persons and Restricted
Persons’ businesses, properties and obligations and to induce each Lender to
enter into this Agreement and to extend credit hereunder, each of US Borrower
and, with respect to itself and its Subsidiaries, the other Borrowers
represents and warrants to each Lender that:

 

Section 5.1.  No Default.  No event has occurred and is continuing which constitutes a
Default, except as has been waived in accordance with this Agreement.

 

Section 5.2.  Organization and Good Standing.  Each Significant Restricted Person is duly
organized or formed, validly existing and in good standing under the Laws of
its jurisdiction of organization or formation, having all requisite corporate
or similar powers required to carry on its

 

53

 

business and enter into and
carry out the transactions contemplated hereby.  Each Significant Restricted Person is duly qualified, in good
standing, and authorized to do business in all other jurisdictions wherein the
character of the properties owned or held by it or the nature of the business
transacted by it makes such qualification necessary except where the failure to
so qualify would not reasonably be expected to cause a Material Adverse Change.

 

Section 5.3.  Authorization.  Each Restricted Person has duly taken all
action necessary to authorize the execution and delivery by it of the Loan
Documents to which it is a party and to authorize the consummation of the transactions
contemplated thereby and the performance of its obligations thereunder.  Each Borrower is duly authorized to borrow
funds hereunder.

 

Section 5.4.  No Conflicts or Consents.  The execution and delivery by each
Restricted Person of the Loan Documents to which it is a party, the performance
by it of its obligations, and the consummation of the transactions contemplated
thereby, do not and will not (i) violate any provision of (1) Law applicable to
it, (2) its organizational documents or (3) any judgment, order or material
license or permit applicable to or binding upon it, (ii) result in the
acceleration of any Indebtedness owed by it or (iii) result in or require the
creation of any consensual Lien upon any of its material assets or properties
except as expressly contemplated in, or permitted by, the Loan Documents.  Except as expressly contemplated in or
permitted by the Loan Documents, disclosed in the Disclosure Schedule or
disclosed pursuant to Section 6.4, no permit, consent, approval, authorization
or order of, and no notice to or filing, registration or qualification with,
any Tribunal is required on the part of any Restricted Person a party thereto
pursuant to the provisions of any material Law applicable to it as a condition
to its execution, delivery or performance of any Loan Document or (ii) to
consummate any transactions contemplated by the Loan Documents.

 

Section 5.5.  Enforceable Obligations.  This Agreement is, and the other Loan
Documents when duly executed and delivered will be, legal, valid and binding
obligations of each Restricted Person which is a party hereto or thereto,
enforceable in accordance with their terms except as such enforcement may be
limited by bankruptcy, insolvency or similar Laws of general application relating
to the enforcement of creditors’ rights and general principles of equity.

 

Section 5.6.  Initial Financial Statements.  US Borrower has heretofore delivered to each
Lender true, correct and complete copies of the Initial Financial
Statements.  The Initial Financial
Statements fairly present US Borrower’s Consolidated financial position at the
date thereof and the Consolidated results of US Borrower’s operations for the
periods thereof, and in the case of the annual Initial Financial Statements,
Consolidated cash flows for the period thereof.  Since the date of the annual Initial Financial Statements, no
Material Adverse Change has occurred. 
All Initial Financial Statements described in clause (i) of that defined
term were prepared in accordance with GAAP.

 

Section 5.7.  Other Obligations and Restrictions.  As of the closing date hereof, no Restricted
Person has any outstanding payment obligations of any kind (including
contingent obligations, tax assessments and unusual forward or long-term
commitments) which are, in the aggregate, material to US Borrower or material
with respect to US Borrower’s Consolidated financial condition and not
reflected in the Initial Financial Statements, disclosed in the Disclosure
Schedule or otherwise permitted under Section 7.1.  Except as disclosed in the Disclosure Schedule, no Restricted
Person is subject to or restricted by any franchise, contract,

 

54

 

deed, charter restriction, or
other instrument or restriction which would reasonably be expected to cause a
Material Adverse Change.

 

Section 5.8.  Full Disclosure.  No certificate, statement or other
information delivered herewith or heretofore by any Restricted Person to any
Lender in connection with the negotiation of this Agreement or in connection
with any transaction contemplated hereby contains any untrue statement of a
material fact or omits to state any material fact necessary to make the
statements contained herein or therein, in light of the circumstances under
which they were made, not misleading as of the date made or deemed made (or if
such information expressly relates or refers to an earlier date, as of such
earlier date).  All written information
furnished after the date hereof by or on behalf of any Restricted Person to
Administrative Agent or any Lender Party in connection with this Agreement and
the other Loan Documents and the transactions contemplated hereby and thereby
will be true, complete and accurate in every material respect in light of the
circumstances in which made or based on reasonable estimates, in each case as
of the date on which such information is stated or certified (or if such
information expressly relates or refers to an earlier date, as of such earlier
date).  There is no fact known to any Restricted
Person that has not been disclosed to each Lender in writing which would
reasonably be expected to cause a Material Adverse Change.

 

Section 5.9.  Litigation.  Except as disclosed in the Initial Financial Statements or in the
Disclosure Schedule:  (i) there are
no actions, suits or legal, equitable, arbitrative or administrative
proceedings pending, or to the knowledge of any Restricted Person overtly
threatened, against any Restricted Person before any Tribunal which would
reasonably be expected to cause a Material Adverse Change, and (ii) there are
no outstanding judgments, injunctions, writs, rulings or orders by any such
Tribunal against any Restricted Person or, to the knowledge of US Borrower, any
Restricted Person’s stockholders, partners, directors or officers which would
reasonably be expected to cause a Material Adverse Change.

 

Section 5.10.  ERISA Plans and Liabilities.  All currently existing ERISA Plans are
listed in the Disclosure Schedule or pursuant to Section 6.4.  Except as disclosed in the Initial Financial
Statements, in the Disclosure Schedule or pursuant to Section 6.4, no
Termination Event has occurred with respect to any ERISA Plan and all ERISA
Affiliates are in compliance with ERISA in all material respects, to the extent
that the non-compliance therewith would not be reasonably expected to cause a
Material Adverse Change.  No ERISA
Affiliate is required to contribute to, or has any other absolute or contingent
liability in respect of, any “multiemployer plan” as defined in Section 4001 of
ERISA.  Except as set forth in the
Disclosure Schedule:  (i) no
“accumulated funding deficiency” (as defined in Section 412(a) of the Code)
exists with respect to any ERISA Plan, whether or not waived by the Secretary
of the Treasury or his delegate, and (ii) the current value of each ERISA
Plan’s benefits does not exceed the current value of such ERISA Plan’s assets
available for the payment of such benefits by more than $5,000,000.

 

Section 5.11.  Compliance with Permits, Consents and Law.  Except as set forth in the Disclosure
Schedule or pursuant to Section 6.4, each Restricted Person has all permits,
licenses and authorizations required in connection with the conduct of its
businesses, except to the extent failure to have any such permit, license or
authorization would not reasonably be expected to cause a Material Adverse
Change.  Each Restricted Person is in
compliance with the terms and conditions of all such permits, licenses and
authorizations, and is also in compliance with all other limitations,
restrictions, conditions, standards, prohibitions, requirements, obligations,

 

55

 

schedules and timetables
contained in any Law, including applicable Environmental Law, or in any
regulation, code, plan, order, decree, judgment, injunction, notice or demand
letter issued, entered, promulgated or approved thereunder, except to the
extent that non-compliance therewith would not reasonably be expected to cause
a Material Adverse Change or such term, restriction or otherwise is being
contested in good faith or a bona fide dispute exists with respect thereto.

 

Section 5.12.  Environmental Laws.  Except as set forth in the Disclosure
Schedule or disclosed pursuant to Section 6.4, (i) US Borrower and its
Subsidiaries are conducting their businesses in material compliance with all
applicable Laws, including Environmental Laws, and have and are in compliance
with all licenses and permits required under any such Laws, unless failure to
so comply or have such licenses and permits would not reasonably be expected to
cause a Material Adverse Change; (ii) none of the operations or properties
of US Borrower or any of its Subsidiaries is the subject of federal, provincial
or local investigation evaluating whether any material remedial action is
needed to respond to a release of any Hazardous Materials into the environment
or to the improper storage or disposal (including storage or disposal at
offsite locations) of any Hazardous Materials, unless such remedial action
would not reasonably be expected to cause a Material Adverse Change; and
(iii) neither US Borrower nor any of its Subsidiaries (and to the actual
knowledge of US Borrower, no other Person) has filed any notice under any Law
indicating that any Restricted Person is responsible for the improper release
into the environment, or the improper storage or disposal, of any material
amount of any Hazardous Materials or that any Hazardous Materials have been
improperly released, or are improperly stored or disposed of, upon any property
of any such Person, other than of an alleged improper release, storage or
disposal that would not reasonably be expected to cause a Material Adverse
Change.

 

Section 5.13.  US Borrower’s Subsidiaries.  US Borrower has no Subsidiary and owns no
stock in any other corporation or association except as listed in the
Disclosure Schedule or disclosed after the closing date hereof to
Administrative Agent in writing.  No
Restricted Person is a member of any general or limited partnership, limited
liability company, joint venture or association of any type whatsoever except
those listed in the Disclosure Schedule or disclosed after the closing date
hereof to Administrative Agent in writing. 
US Borrower owns, directly or indirectly, the equity interest in each of
its Subsidiaries which is indicated in the Disclosure Schedule.

 

Section 5.14.  Title to Properties.  Each Restricted Person has good and
defensible title to all of its material properties and assets, free and clear
of all Liens (other than Permitted Liens) and of all impediments to the use of
such properties and assets in such Restricted Person’s business, other than
such impediments that would not reasonably be expected to cause a Material
Adverse Change.

 

Section 5.15.  Government Regulation.  Neither any Borrower nor any other
Restricted Person owing Obligations is subject to regulation under the Public
Utility Holding Company Act of 1935, the Investment Company Act of 1940 (as any
of the preceding acts have been amended) or any other Law which regulates the
incurring by such Person of Indebtedness, including Laws relating to common
contract carriers or the sale of electricity, gas, steam, water or other public
utility services.  Neither any Borrower
nor any other Restricted Person is subject to regulation under the Federal
Power Act which would violate, result in a default of, or prohibit the
effectiveness or the performance of any of the provisions of the Loan
Documents.

 

56

 

Section 5.16.  Insider.  No Restricted Person, nor any Person having “control” (as that
term is defined in 12 U.S.C. § 375b(9) or in regulations promulgated pursuant
thereto) of any Restricted Person, is a “director” or an “executive officer” or
“principal shareholder” (as those terms are defined in 12 U.S.C. § 375b(8) or
(9) or in regulations promulgated pursuant thereto) of any Lender, of a bank
holding company of which any Lender is a Subsidiary or of any Subsidiary of a
bank holding company of which any Lender is a Subsidiary.

 

Section 5.17.  Solvency.  Upon giving effect to the issuance of the Notes, the execution of
the Loan Documents by Borrowers and each Guarantor and the consummation of the
transactions contemplated hereby, (i) each Borrower and each Guarantor will be
solvent (as such term is used in applicable bankruptcy, liquidation,
receivership, insolvency or similar Laws), and the sum of each Borrower’s and
each Guarantor’s absolute and contingent liabilities, including the Obligations
or guarantees thereof, shall not exceed the fair market value of such
Restricted Person’s assets, and (ii) each Borrower’s and each Guarantor’s
capital should be adequate for the businesses in which such Restricted Person
is engaged and intends to be engaged. 
Neither any Borrower nor any other Restricted Person has incurred
(whether under the Loan Documents or otherwise), nor does any Restricted Person
intend to incur or reasonably foreseeably believes that it will incur, debts
which will be beyond its ability to pay as such debts mature.

 

Section 5.18.  Not a “Reportable Transaction”. No
Borrower intends to treat the Borrowings and/or Letters of Credit and related
transactions as being a “reportable transaction” (within the meaning of
Treasury Regulation Section 1.6011-4). 
In the event any Borrower determines to take any action inconsistent
with such intention, it will promptly notify the Administrative Agent
thereof.  If any Borrower takes any
action inconsistent with such intention, or if any Borrower so notifies the Administrative
Agent, then such Borrower acknowledges that, as a result of such action or
notice, one or more of the Lenders may treat its Loans and/or Canadian Advances
and/or its interest in Letters of Credit as part of a transaction that is
subject to Treasury Regulation Section 301.6112-1, and such Lender or Lenders
will maintain the lists and other records required by such Treasury Regulation.

 

ARTICLE VI - Affirmative Covenants 

 

To conform
with the terms and conditions under which each Lender is willing to have credit
outstanding to Borrowers, and to induce each Lender to enter into this
Agreement and extend credit hereunder, each of US Borrower and, with respect to
itself and its Subsidiaries, the other Borrowers, covenants and agrees that
until the full and final payment of the Obligations and the termination of this
Agreement, unless Majority Lenders, or all Lenders as required under Section
10.1, have previously agreed otherwise:

 

Section 6.1.  Payment and Performance.  Each Restricted Person will pay all amounts
due from it pursuant to the provisions of the Loan Documents to which it is a
party in accordance with the terms thereof and will observe, perform and comply
with every covenant, term and condition imposed on it pursuant to the
provisions of such Loan Documents.

 

Section 6.2.  Books, Financial Statements and Reports.  Each Restricted Person will at all times
maintain full and accurate books of account and records. US Borrower will
maintain and will cause its Subsidiaries to maintain a standard system of
accounting, will maintain its Fiscal

 

57

 

Year, and will furnish the
following statements and reports to each Lender at US Borrower’s expense:

 

(a)  Promptly upon the filing thereof, and in any
event within ninety (90) days after the end of each Fiscal Year, a copy of US
Borrower’s Form 10-K, which report shall include US Borrower’s complete
Consolidated financial statements together with all notes thereto, prepared in
reasonable detail in accordance with GAAP, together with an opinion, without
material qualification, based on an audit using generally accepted auditing
standards, by PricewaterhouseCoopers LLP, or other independent certified public
accountants selected by General Partner, stating that such Consolidated
financial statements have been so prepared. 
These financial statements shall contain a Consolidated balance sheet as
of the end of such Fiscal Year and Consolidated statements of earnings for such
Fiscal Year.  Such Consolidated financial
statements shall set forth in comparative form the corresponding figures for
the preceding Fiscal Year.

 

(b)  Promptly upon the filing thereof, and in any
event within sixty (60) days after the end of each of the first three Fiscal
Quarters of each Fiscal Year, a copy of US Borrower’s Form 10-Q, which
report shall include US Borrower’s unaudited Consolidated balance sheet as of
the end of such Fiscal Quarter and Consolidated statements of US Borrower’s
earnings and cash flows for such Fiscal Quarter and for the period from the
beginning of the then current Fiscal Year to the end of such Fiscal
Quarter.  In addition US Borrower will,
together with each such set of financial statements and each set of financial
statements furnished under subsection (a) of this section, furnish a
certificate in the form of Exhibit D signed by the chief financial officer,
principal accounting officer or treasurer of General Partner stating that such
financial statements are accurate and complete in all material respects (subject
to normal year-end adjustments), stating that he has reviewed the Loan
Documents, containing calculations showing compliance (or non-compliance) at
the end of such Fiscal Quarter with the requirements of Sections 7.8 and 7.9
and stating that, to the best of his knowledge, no Default exists at the end of
such Fiscal Quarter or at the time of such certificate or specifying the nature
and period of existence of any such Default.

 

(c)  Promptly upon their becoming available,
copies of all Form 8-K’s filed by US Borrower with any securities exchange, the
Securities and Exchange Commission or any similar governmental authority.

 

(d)  Promptly upon their becoming available,
copies of all financial statements, reports, notices and proxy statements sent
by US Borrower to its unit holders and all registration statements filed by US
Borrower with any securities exchange, the Securities and Exchange Commission
or any similar governmental authority.

 

(e)  Prompt notice of any publicly announced
change in PAA’s Debt Rating by either Standard & Poor’s or Moody’s.

 

Documents required to be
delivered pursuant to Section 6.2(a), (b), (c) or (d), (to the extent any such
documents are included in materials otherwise filed with the Securities and
Exchange Commission) may be delivered electronically and if so delivered, shall
be deemed to have been delivered on the date on which the Borrower posts such
documents, or provides a link thereto, on

 

58

 

the Borrower’s website on the
Internet at the website address listed in Section 10.3, and notifies
Administrative Agent of such posting or link.

 

Section 6.3.  Other Information and Inspections.  In each case subject to the last sentence of
this Section 6.3, each Restricted Person will furnish to Administrative Agent
any information which Administrative Agent or any Lender may from time to time
reasonably request concerning any covenant, provision or condition of the Loan
Documents or any matter in connection with any Restricted Person’s businesses
and operations.  In each case subject to
the last sentence of this Section 6.3, each Restricted Person will permit
representatives appointed by Administrative Agent (including independent
accountants, auditors, agents, attorneys, appraisers and any other Persons),
upon reasonable prior notice, to visit and inspect during normal business hours
any of such Restricted Person’s property, including its books of account, other
books and records, and any facilities or other business assets, and to make extra
copies therefrom and photocopies and photographs thereof, and to write down and
record any information such representatives obtain, and each Restricted Person
shall permit Administrative Agent or its representatives to investigate and
verify the accuracy of the information furnished to Administrative Agent or any
Lender in connection with the Loan Documents and to discuss all such matters
with its officers, employees and, upon reasonable prior notice to US Borrower,
its representatives.  Each of the foregoing
inspections and examinations shall be made subject to compliance with
applicable safety standards and the same conditions applicable to any
Restricted Person in respect of property of that Restricted Person on the
premises of Persons other than a Restricted Person or an Affiliate of a
Restricted Person, and all information, books and records furnished or
requested to be made, all information to be investigated or verified and all
discussion conducted with any officer, employee or representative of any
Restricted Person shall be subject to any applicable attorney-client privilege
exceptions which the Restricted Person determines is reasonably necessary and
compliance with conditions to disclosures under non-disclosure agreements
between any Restricted Person and Persons other than a Restricted Person or an
Affiliate of a Restricted Person and the express undertaking of each Person
acting at the direction of or on behalf of any Lender Party to be bound by the
confidentiality provisions of Section 10.6 of this Agreement.

 

Section 6.4.  Notice of Material Events.  US Borrower will notify each Lender Party,
not later than five (5) Business Days after any executive officer of US
Borrower has knowledge thereof, stating that such notice is being given pursuant
to this Agreement, of:

 

(a)  the occurrence of any
Material Adverse Change,

 

(b)  the occurrence of any
Default,

 

(c)  the acceleration of the
maturity of any Indebtedness owed by any Restricted Person or of any default by
any Restricted Person under any indenture, mortgage, agreement, contract or
other instrument to which any of them is a party or by which any of them or any
of their properties is bound, if such acceleration or default would reasonably
be expected to cause a Material Adverse Change,

 

(d)  the occurrence of any
Termination Event,

 

(e)  any claim under any
Environmental Law adverse to a Restricted Person or of potential liability with
respect to such claim, or any other adverse claim asserted against any
Restricted Person or with respect to any Restricted Person’s properties taken
as a

 

59

 

whole, in each
case, which claim would reasonably be expected to cause a Material Adverse
Change, and

 

(f)  the filing of any suit or
proceeding, or the assertion in writing of a claim against any Restricted
Person or with respect to any Restricted Person’s properties, which would
reasonably be expected to cause a Material Adverse Change.

 

Upon the occurrence of any of
the foregoing the applicable Restricted Person will take all necessary or
appropriate steps to remedy promptly, if applicable, any such Material Adverse
Change, Default, acceleration, default or Termination Event, to protect against
any such adverse claim, to defend any such claim, suit or proceeding, and to
resolve all controversies on account of any of the foregoing.

 

Section 6.5.  Maintenance of Existence, Qualifications
and Assets.  Each Significant
Restricted Person (i) will maintain and preserve its existence and its rights
(including permits, licenses and other authorizations required under
Environmental Laws) and franchises in full force and effect, (ii) will qualify
to do business in all states or jurisdictions where required by applicable Law,
and (iii) keep all of its material assets that are useful in and necessary to
its business in good working order and condition (ordinary wear and tear and
obsoleteness excepted) except, in each case (a) where the failure so to
maintain, preserve, qualify or keep would not be reasonably expected to cause a
Material Adverse Change, (b) as permitted in Section 7.3 or as a result of
statutory conversions or (c) as a result of a release permitted pursuant to
Section 6.9.  US Borrower will notify
Administrative Agent in writing of any changes in its or any other Significant
Restricted Person’s name or the location of its or any other Significant
Restricted Person’s chief executive office or principal place of business.

 

Section 6.6.  Payment of Taxes, etc.  Each Significant Restricted Person will (a)
timely file all required tax returns (including any extensions), (b) timely pay
all taxes, assessments, and other governmental charges or levies imposed upon
it or upon its income, profits or property, and (c) maintain appropriate
accruals and reserves for all of the foregoing as required by GAAP, except to
the extent that (y) it is in good faith contesting the validity thereof by
appropriate proceedings, if necessary, and has set aside on its books adequate
reserves therefor which are required by GAAP or (z) such non-filing,
non-payment or non-maintenance would not reasonably be expected to cause a
Material Adverse Change.

 

Section 6.7.  Insurance.  In accordance with industry standards, each Significant
Restricted Person will keep insured (by responsible and reputable insurance
companies or associations) or self-insured, at the option of US Borrower or
such Significant Restricted Person, in such amounts and against such risks as
are usually insured by Persons engaged in the same or similar businesses and
owning similar properties.  The
insurance coverages and amounts will be reasonably determined by US Borrower,
based on coverages carried by prudent owners of similar property, and with
respect to each Restricted Person, may be maintained by the US Borrower.

 

Section 6.8.  Compliance with Agreements and Law.  Each Significant Restricted Person will
perform all material obligations it is required to perform under the terms of
each indenture, mortgage, deed of trust, security agreement, lease, franchise
and other material agreement, contract or other instrument (including all
contractual obligations and agreements with respect to environmental
remediation or other environmental matters) to which it is a party or by which
it or

 

60

 

any of its properties is bound
to the extent that non-performance therewith would not reasonably be expected
to cause a Material Adverse Change. 
Each Restricted Person will conduct its business and affairs in compliance,
in all material respects, with all Laws (including Environmental Laws)
applicable thereto to the extent non-compliance therewith would not reasonably
be expected to cause a Material Adverse Change or such requirement of Law is
being contested in good faith or a bona fide dispute exists with respect
thereto.

 

Section 6.9.  Guaranties of Subsidiaries.  Each Significant Restricted Person that has
outstanding Indebtedness (other than guarantees hereunder) shall execute and
deliver to Administrative Agent an absolute and unconditional guaranty of the
timely repayment of the Obligations (in each case for which such Person is not
a borrower, account party or similar primary and direct obligor), which
guaranty shall be reasonably satisfactory to Administrative Agent in form and
substance; provided, with respect to any such Person that is not a
Wholly Owned Subsidiary of US Borrower, for which consent or approval of third
parties is required for the delivery of such guaranty, such Person shall not be
required to deliver such guaranty, but shall use its commercially reasonable
best efforts, as determined by Administrative Agent, to deliver such guaranty.
Notwithstanding any provision contained herein, in no event shall any
Unrestricted Subsidiary be required to execute and deliver any guaranty for, or
in respect of, the Obligations, or any part thereof.  US Borrower will cause each of its Subsidiaries required to
deliver a guaranty pursuant to this Section 6.9 to deliver to Administrative
Agent, simultaneously with its delivery of such a guaranty, written evidence
satisfactory to Administrative Agent that such Subsidiary has taken all
corporate, limited liability company or partnership action necessary to duly
approve and authorize its execution, delivery and performance of such guaranty.  US Borrower may at any time request the
release of one or more Guarantors from their guaranty of the Obligations (other
than the guaranty by US Borrower of the Obligations of Canadian Borrower and
Canadian Working Capital Borrower), and each such Guarantor shall be so
released upon such request, provided, no Default then exists and either
(a) such Guarantor has no outstanding Indebtedness or guaranties of
Indebtedness (other than guaranties hereunder) or (b) the request is in
contemplation of the sale or disposition of such Subsidiary (including all or
substantially all of its assets).  Each
Agent, as applicable, is authorized to execute and deliver to US Borrower
evidence of any such release, as reasonably requested by, and at the expense
of, US Borrower.

 

ARTICLE VII - Negative Covenants

 

To conform
with the terms and conditions under which each Lender is willing to have credit
outstanding to each of Borrowers and to induce each Lender to enter into this
Agreement and make the Loans, each of US Borrower and, with respect to itself
and its Subsidiaries, the other Borrowers, covenants and agrees that until the
full and final payment of the Obligations and the termination of this
Agreement, unless Majority Lenders, or all Lenders as required under Section
10.1, have previously agreed otherwise:

 

Section 7.1.  Subsidiary Indebtedness.  No Subsidiary of US Borrower will incur any
Indebtedness other than:

 

(a)  the Obligations;

 

61

 

(b)  Guaranties by Guarantors of Indebtedness of
US Borrower or any other Restricted Person (i) arising under the 364-Day Credit
Agreement or (ii) if arising under any other agreement, the incurrence of which
did not result in a Default or an Event of Default;

 

(c)  Indebtedness of Plains Marketing pursuant to
the Contango Credit Agreement in an aggregate principal amount not to exceed at
any time outstanding $300,000,000;

 

(d)  Indebtedness of any Restricted Person owing
to another Restricted Person;

 

(e)  Indebtedness of any Subsidiary described in
clause (b) of the definition of “Indebtedness” that is determinable but not yet
earned; provided, US Borrower reasonably contemplates that such
Indebtedness will be repaid from the proceeds of one or more advances made by
US Borrower to such Subsidiary;

 

(f)  Indebtedness of a Subsidiary acquired
(including acquisition by merger, consolidation or amalgamation) after the date
hereof by a Restricted Person, which Indebtedness was incurred by such
Subsidiary before the time of such acquisition, merger, consolidation or
amalgamation, and was not created in contemplation thereof; provided,
that contemporaneously with such acquisition, merger, consolidation or
amalgamation, and so long as no adverse tax and/or regulatory consequences are
caused thereby, such Subsidiary shall be a Guarantor subject to the provisions
of Section 6.9; and

 

(g)  Indebtedness not otherwise described in the
foregoing clauses (a) through (f) owing by any one or more Guarantors in an
aggregate principal amount not to exceed at any time outstanding the greater of
(A) $100,000,000 and (B) fifteen percent (15%) of Consolidated Tangible
Net Worth.

 

Section 7.2.  Limitation on Liens.  No Restricted Person will create, assume or
permit to exist any Lien upon any of the properties or assets which it now owns
or hereafter acquires, except the following (“Permitted Liens”):

 

(a)  Liens securing (i) on a pari passu basis,
both (x) the Obligations and (y) the Liabilities of any Restricted Person
arising under the 364-Day Credit Agreement, and (ii) if required, any related
interest hedge rate agreements;

 

(b)  Liens securing Indebtedness of Plains
Marketing under the Contango Credit Agreement at any one time outstanding not
in excess of $300,000,000 on (i) Petroleum Products subject to Cash and Carry
Purchases financed pursuant to the Contango Credit Agreement, (ii) hedging
contracts covering such Petroleum Products, (iii) contracts for the
purchase or sale of such Petroleum Products and accounts receivable arising
therefrom, and (iv) all proceeds of the foregoing;

 

(c)  Liens imposed by any governmental authority
for taxes, assessments or charges not yet due or the validity of which is being
contested in good faith and by appropriate proceedings, if necessary, for which
adequate reserves are maintained on the books of any Restricted Person in
accordance with GAAP;

 

62

 

(d)  pledges or deposits of cash or securities
under worker’s compensation, unemployment insurance or other social security
legislation;

 

(e)  carriers’, warehousemen’s, mechanics’,
materialmen’s, repairmen’s, landlord’s, or other like Liens (including without
limitation, Liens on property of any Restricted Person in the possession of
storage facilities, pipelines or barges) arising in the ordinary course of
business for amounts which are not more than 60 days past due or the validity
of which is being contested in good faith and, if necessary, by appropriate
proceedings, and for which adequate reserves are maintained on the books of any
Restricted Person in accordance with GAAP;

 

(f)  Liens on cash and Cash Equivalents under or
with respect to accounts with brokers or counterparties with respect to hedging
contracts consisting of cash, commodities or futures contracts, options,
securities, instruments, and other like assets securing only hedging contracts;

 

(g)  deposits of cash or securities to secure the
performance of bids, trade contracts (other than for borrowed money), leases,
statutory obligations, surety and appeal bonds, performance bonds and other
obligations of a like nature incurred in the ordinary course of business;

 

(h)  easements, rights-of-way, restrictions and
other similar encumbrances incurred in the ordinary course of business and
encumbrances consisting of zoning restrictions, easements, licenses,
restrictions on the use of real property or minor imperfections in title
thereto which, in the aggregate, are not material in amount, and which do not
in any case materially detract from the value of the property subject thereto
or interfere with the ordinary conduct of the business of any Restricted
Person;

 

(i)  Liens in respect of operating leases;

 

(j)  Liens upon any property or assets directly
or indirectly acquired after the date hereof by a Restricted Person, each of which
either (i) existed on such property or asset before the time of its acquisition
and was not created in anticipation thereof, or (ii) was created solely for the
purpose of securing Indebtedness representing, or incurred to finance,
refinance or refund, the cost (including the cost of construction) of such
property or asset; provided that no such Lien shall extend to or cover any
property or asset of a Restricted Person other than the property or asset so
acquired (or constructed); and any extension, renewal, refinancing, refunding
or replacement (or successive extensions, renewals, refinancings, refundings or
replacements), in whole or part, of the foregoing, provided, however, that such
Liens shall not cover or secure any additional Indebtedness, obligations,
property or asset;

 

(k)  rights reserved to or vested in any
governmental authority by the terms of any right, power, franchise, grant,
license or permit, or by any provision of law, to revoke or terminate any such
right, power, franchise, grant, license or permit or to condemn or acquire by
eminent domain or similar process;

 

(l)  rights reserved to or vested by Law in any
governmental authority to in any manner, control or regulate in any manner any
of the properties of any Restricted Person or the use thereof or the rights and
interests of any Restricted Person therein, in any manner under any and all
Laws;

 

63

 

(m)  rights reserved to the grantors of any
properties of any Restricted Person, and the restrictions, conditions,
restrictive covenants and limitations, in respect thereto, pursuant to the
terms, conditions and provisions of any rights-of-way agreements, contracts or
other agreements therewith;

 

(n)  inchoate Liens in respect of pending litigation
or with respect to a judgment which has not resulted in an Event of Default
under Section 8.1;

 

(o)  Liens securing obligations in an aggregate
principal amount not to exceed at any time outstanding 10% of US Borrower’s
Consolidated Tangible Net Worth; and

 

(p)  Liens related to the extension, renewal,
refinancing, refunding or replacement (or successive extensions, renewals,
refinancings, refundings or replacements), in whole or in part, of clauses (a),
(b) and (o) of this Section 7.2; provided, however, that such Liens shall not
cover or secure any additional Indebtedness.

 

Section 7.3.  Limitation on Mergers.  Except as expressly provided in this
section, no Significant Restricted Person (other than (i) a Guarantor for whom
a release has been requested pursuant to an event described in clause (b) of
Section 6.9 and otherwise is so released, or (ii) such other Significant
Restricted Person, other than a Borrower, that is the subject of any such event
described in such clause (b) of Section 6.9) will (a) merge or consolidate
or amalgamate with any Person, or liquidate, wind up or dissolve or (b) sell,
transfer, lease, exchange or otherwise dispose of, in one transaction or a
series of related transactions, all or substantially all of its business or property,
whether now owned or hereafter acquired, to any Person; provided, any
such Significant Restricted Person, other than a Borrower, may (A) merge into
or consolidate or amalgamate with, and such business and property may be
disposed of to:

 

(i)  any other Subsidiary of US
Borrower; provided, if such Significant Restricted Person or such
Subsidiary is a Guarantor, a Guarantor is the surviving or transferee (as
applicable) business entity,

 

(ii)  any Borrower, so long as such Borrower is the surviving or transferee
(as applicable) business entity and after giving effect thereto, no Default
exists, or

 

(iii) any other Person pursuant or incidental to, or in connection
with, any contemporaneous or substantially contemporaneous acquisition, provided
that for purposes of this clause (iii) such merging, amalgamating,
consolidating or transferor Significant Restricted Person is not a Borrower,
Guarantor or a Wholly Owned Subsidiary of US Borrower, other than a Wholly
Owned Subsidiary that was formed, acquired or created solely for purposes of
such acquisition or otherwise conducted no operations and owned no assets,
other than of an inconsequential amount and

 

(B) dissolve, liquidate or wind
up if such dissolution, liquidation and winding up results from dispositions
not prohibited by this Agreement.

 

Section 7.4.  Limitation on New Businesses.  No Restricted Person will materially or
substantially engage directly or indirectly in any business or conduct any
operations other than (i) marketing, gathering, transporting (by barge,
pipeline, ship, truck or other modes of hydrocarbon transportation),
terminalling, storing, producing, acquiring, developing, exploring for,
exploiting,

 

64

 

producing, processing,
dehydrating and otherwise handling hydrocarbons, including, without limitation,
constructing pipeline, platform, dehydration, processing and other
energy-related facilities,, (ii) any other business that generates gross income
that constitutes “qualifying income” under Section 7704(d) of the Internal
Revenue Code of 1986, as amended, or (iii) activities or services reasonably
related or ancillary thereto, including entering into hedging obligations to
support those businesses.

 

Section 7.5.  Transactions with Affiliates.  No Restricted Person will engage in any
material transaction with any of its Affiliates except as follows: (a)
transactions among US Borrower and its Subsidiaries or between Subsidiaries of
US Borrower; (b) if and to the extent any of them constitute transactions with
Affiliates, transactions governed by the Crude Oil Marketing Agreement among
Plains Resources Inc., Plains Illinois Inc., Stocker Resources, L.P., Arguello
Inc., Calumet Florida Inc. (and successors of each) and Plains Marketing dated
November 23, 1998 or the Omnibus Agreement between Plains Resources Inc.,
US Borrower, Plains Marketing, All American and Plains All American Inc. (and
successors of each) dated November 23, 1998, as amended and in effect;
(c) any employment, equity award, equity option or equity appreciation
agreement or plan entered into by US Borrower or any of its Subsidiaries in the
ordinary course of business of US Borrower or such Subsidiary; (d) transactions
effected in accordance with the terms of agreements as in effect on the closing
date hereof; (e) customary compensation, indemnification and other benefits
made available to officers, directors or employees of US Borrower, any of its
Subsidiaries or GP LLC, including reimbursement or advancement of out-of-pocket
expenses and provisions of officers’ and directors’ liability insurance; (f)
transactions as contemplated by US Borrower’s agreement of limited partnership;
and (g) transactions on terms which are no less favorable to such Restricted
Person than those which would have been obtainable at the time in arm’s-length
transactions with Persons other than such Affiliates.

 

Section 7.6.  Limitation on Distributions.  US Borrower shall not declare or pay any
Distribution so long as any Default or Event of Default has occurred and is
continuing or would result therefrom.

 

Section 7.7.  Restricted Contracts.  Except as expressly provided for in the Loan
Documents and as described in the Disclosure Schedule or pursuant to a
Restriction Exception, the substance of which, in detail satisfactory to
Administrative Agent, is promptly reported to Administrative Agent, no
Restricted Person will, directly or indirectly, enter into, create, or
otherwise allow to exist any contract or other consensual restriction on the
ability of any Subsidiary of US Borrower, including but not limited to Canadian
Borrower, Canadian Working Capital Borrower and any Subsidiary of such Persons
to:  (a) pay dividends or make
other distributions to US Borrower, Canadian Borrower, or Canadian Working
Capital Borrower, (b) redeem equity interests held in it by US Borrower,
Canadian Borrower, or Canadian Working Capital Borrower, (c) repay loans
and other indebtedness owing by it to US Borrower, Canadian Borrower, or
Canadian Working Capital Borrower, or (d) transfer any of its assets to
US Borrower, Canadian Borrower, or Canadian Working Capital Borrower.

 

Section 7.8.  Debt Coverage Ratio.  At the end of any Fiscal Quarter, the Debt
Coverage Ratio will not be greater than the amount set forth below for the applicable
time set forth below:

 

	
  (i) During
  an Acquisition Period:

  	
   

  	
  5.25 to 1.0

  

 

65

 

	
  (ii) Other
  than an Acquisition Period:

  	
   

  	
  4.50 to 1.0

  

 

As used herein, “Debt
Coverage Ratio” means the ratio of (a) Consolidated Funded Indebtedness to
(b) Consolidated EBITDA, for the four Fiscal Quarter period (or other
period specified below) most recently ended prior to the date of determination
for which financial statements contemplated by Section 6.2(a) or (b) are available
to US Borrower; provided, for purposes of this Section 7.8, if, since
the beginning of the four Fiscal Quarter period ending on the date for which
Consolidated EBITDA is determined, any Restricted Person shall have made any
asset disposition or acquisition, shall have consolidated or merged with or
into any Person (other than another Restricted Person), or shall have made any
disposition or acquisition of a Restricted Person or disposition or acquisition
of any partial ownership interest in any other Person, Consolidated EBITDA
shall be calculated giving pro forma effect thereto as if the disposition,
acquisition, consolidation or merger had occurred on the first day of such
period; provided, with respect to any Person not constituting a
Subsidiary of US Borrower, such pro forma calculation of Consolidated EBITDA,
with respect to any such Person, shall be limited to not more than 75% of (i)
such Restricted Person’s ownership interest in such Person times (ii)
the difference of such Person’s (A) Consolidated EBITDA minus (B)
Interest Expense and capital expenditures. 
Such pro forma calculations shall be determined (i) in good faith by the
chief financial officer of US Borrower, and (ii) without giving effect to
any anticipated or proposed change in operations, revenues, expenses or other
items included in the computation of Consolidated EBITDA, except cost
reductions specifically identified at the time of disposition, acquisition,
consolidation or merger that are attributable to personnel reductions, non-recurring
maintenance and environmental costs and allocated corporate overhead.

 

Section 7.9.  Interest Coverage Ratio.  The ratio of (a) Consolidated EBITDA to
(b) Interest Expense for each four Fiscal Quarter period ending on or
after the date hereof will not be less than 2.75 to 1.0.

 

Section 7.10.  Unrestricted Subsidiaries.  So long as no Default or Event of Default
has occurred and is continuing, and after giving effect to such designation, no
Default or Event of Default would result therefrom, US Borrower or any Wholly
Owned Subsidiary of US Borrower may designate one or more Subsidiaries that are
not Borrowers or Guarantors (each such Subsidiary, and each of its
Subsidiaries, each an “Unrestricted Subsidiary”), which Unrestricted
Subsidiaries shall be subject to the following:

 

(a)                                  No
Unrestricted Subsidiary shall be deemed to be a “Restricted Person” or a
“Subsidiary” of US Borrower for purposes of this Agreement or any other Loan
Document, and no Unrestricted Subsidiary shall be subject to or included within
the scope of any provision herein or in any other Loan Document, including
without limitation any representation, warranty, covenant or Event of
Default  herein or in any other Loan
Document, except as set forth in this Section 7.10.

 

(b)                                 No
Restricted Person shall guarantee or otherwise become liable in respect of any
Indebtedness of, grant any Lien on any of its property to secure any
Indebtedness of or other obligation of, or provide any other form of credit
support to, any Unrestricted Subsidiary, and no Restricted Person shall enter
into any contract or agreement with any Unrestricted Subsidiary,

 

66

 

except on
terms no less favorable to such Restricted Person, as applicable, than could be
obtained in a comparable arm’s length transaction with a non-Affiliate of such
Restricted Person.

 

(c)                                  Borrowers
shall at all times maintain, as between Restricted Persons and Unrestricted
Subsidiaries, the separate existence of each Unrestricted Subsidiary.

 

(d)                                 Restricted
Persons shall notify each Lender Party, not later than five (5) Business Days
after any executive officer of Restricted Persons has knowledge of, any claim,
including any claim under any Environmental Law, or any notice of potential
liability under any Environmental Law, asserted against any Unrestricted
Subsidiary or with respect to any Unrestricted Subsidiary’s properties that
would reasonably be expected to result in a Material Adverse Change, stating
that such notice is being given pursuant to this Section 7.10.

 

US Borrower
may designate any Unrestricted Subsidiary to become a Restricted Person if a
Default or Event of Default is not continuing, such designation would not
result in a Default or an Event of Default, and immediately thereafter such
Subsidiary has no outstanding Indebtedness. 
Immediately thereafter, US Borrower shall promptly notify the
Administrative Agent of such designation and provide to it an officer’s
certificate that such designation was made in compliance with this Section
7.10.

 

Section 7.11.  No Negative Pledges.  Except as described in the Disclosure
Schedule or pursuant to a Restriction Exception, the substance of which, in
detail satisfactory to Administrative Agent, is promptly reported to
Administrative Agent, no Restricted Person will, directly or indirectly, enter
into, create, or consent to be bound to any contract or other consensual
restriction that restricts the ability of any Restricted Person to create or
maintain Liens on its assets in favor of Agents, LC Issuers and Lenders to
secure, in whole or part, the Obligations.

 

ARTICLE VIII - Events of Default and
Remedies

 

Section 8.1.  Events of Default.  Each of the following events constitutes an
Event of Default under this Agreement:

 

(a)  Any Borrower fails to pay the principal
component of any Loan made to it or any reimbursement obligation of it with
respect to any Letter of Credit when due and payable, whether at a date for the
payment of a fixed installment or as a contingent or other payment becomes due
and payable or as a result of acceleration or otherwise;

 

(b)  Any Restricted Person fails to pay any
Obligation for which it is contractually liable (other than the Obligations in
subsection (a) above) when due and payable, whether at a date for the payment
of a fixed installment or as a contingent or other payment becomes due and
payable or as a result of acceleration or otherwise, within three Business Days
after the same becomes due;

 

(c)  Any Restricted Person fails to duly observe,
perform or comply with any covenant, agreement or provision of Section 6.4 or
Article VII;

 

67

 

(d)  Any Restricted Person fails (other than as
referred to in subsections (a), (b) or (c) above) to duly observe, perform or
comply with any of its obligations under any covenant, agreement, condition or
provision of any Loan Document to which it is a party, and such failure remains
unremedied for a period of thirty (30) days after notice of such failure is
given by Administrative Agent to US Borrower;

 

(e)  Any representation or warranty previously,
presently or hereafter made in writing by or on behalf of any Restricted Person
in connection with any Loan Document shall prove to have been false or
incorrect in any material respect on any date on or as of which made, or any
Loan Document at any time ceases to be valid, binding and enforceable as
warranted in Section 5.5 for any reason other than its release or
subordination by Administrative Agent;

 

(f)  Any Restricted Person shall default in the
payment when due of any principal of or interest on any of its other
Indebtedness, or any net hedging obligations, in excess of the Dollar
Equivalent of $15,000,000 in the aggregate (other than such Indebtedness or
hedging obligations the validity of which is being contested in good faith, by
appropriate proceedings (if necessary) and for which adequate reserves with
respect thereto are maintained on the books of such Restricted Person as
required by GAAP), or any event specified in any note, agreement, indenture or
other document evidencing or relating to any such Indebtedness or hedging
obligations shall occur for a period beyond the applicable grace, cure
extension, forbearance or other similar period, if the effect of such event is
to cause, or (with the giving of any notice or the lapse of time or both) to
permit the holder or holders of such Indebtedness or hedging obligations (or a
trustee or agent on behalf of such holder or holders) to cause, as applicable,
such Indebtedness to become due, or to be prepaid in full (whether by
redemption, purchase, offer to purchase or otherwise), prior to its stated
maturity, or an early termination event or similar event to occur and such
Restricted Person’s related net hedging obligations in excess of the Dollar
Equivalent of $15,000,000 to become due and payable;

 

(g)  Either (i) any “accumulated funding
deficiency” (as defined in Section 
412(a) of the Code) in excess of $5,000,000 exists with respect to any
ERISA Plan, whether or not waived by the Secretary of the Treasury or his
delegate, or (ii) any Termination Event occurs with respect to any ERISA Plan
and the then current value of such ERISA Plan’s benefit liabilities exceeds the
then current value of such ERISA Plan’s assets available for the payment of
such benefit liabilities by more than $5,000,000 (or in the case of a
Termination Event involving the withdrawal of a substantial employer, the
withdrawing employer’s proportionate share of such excess exceeds such amount);

 

(h)  GP LLC, General Partner, or any Significant
Restricted Person:

 

(i)  has entered against it a
judgment, decree or order for relief by a Tribunal of competent jurisdiction in
an involuntary proceeding commenced under any applicable bankruptcy, insolvency
or other similar Law of any jurisdiction now or hereafter in effect, including
the federal Bankruptcy Code, the Bankruptcy and Insolvency Act (Canada) or the
Companies’ Creditors Arrangement Act (Canada), as from time to time amended, or
has any such proceeding commenced against it, in each case, which remains
undismissed for a period of sixty days; or

 

68

 

(ii)  commences a voluntary case
under any applicable bankruptcy, insolvency or similar Law now or hereafter in
effect, including the federal Bankruptcy Code, the Bankruptcy and Insolvency
Act (Canada) or the Companies’ Creditors Arrangement Act (Canada), as from time
to time amended; or applies for or consents to the entry of an order for relief
in an involuntary case under any such Law; or makes a general assignment for
the benefit of creditors; or is generally unable to pay (or admits in writing
its inability to so pay) its debts as such debts become due; or takes corporate
or other action to authorize any of the foregoing; or

 

(iii)  has entered against it
the appointment of or taking possession by a receiver, liquidator, assignee,
custodian, trustee, sequestrator or similar official of all or a substantial
part of its assets in a proceeding brought against or initiated by it, and such
appointment or taking possession is neither made ineffective nor discharged
within sixty days after the making thereof, or such appointment or taking
possession is at any time consented to, requested by, or acquiesced to by it;
or

 

(i)  Any Significant Restricted Person:

 

(i)  has entered against it a
final judgment for the payment of money in excess of the Dollar Equivalent of
$15,000,000 (in each case not covered by insurance satisfactory to
Administrative Agent in its discretion), unless the same is stayed or
discharged within thirty days after the date of entry thereof (or longer period
for which a stay of enforcement is allowed by applicable Law) or an appeal or
appropriate proceeding for review thereof is taken within such period and a stay
of execution pending such appeal is obtained; or

 

(ii)  suffers a writ or warrant
of attachment or any similar process to be issued by any Tribunal against all
or any substantial part of its assets, and such writ or warrant of attachment
or any similar process is not stayed or released within sixty days after the
entry or levy thereof (or longer period for which a stay of enforcement is
allowed by applicable Law) or after any stay is vacated or set aside;

 

(j)  Any Change in Control occurs.

 

Upon the occurrence of an Event
of Default described in subsection (h)(i), (h)(ii) or (h)(iii) of this section:
(a) with respect to US Borrower, all of the Obligations or (b) with respect to
any other Borrower, all of such Borrower’s Obligations, shall thereupon be immediately
due and payable, without demand, presentment, notice of demand or of dishonor
and nonpayment, protest, notice of protest, notice of intention to accelerate,
declaration or notice of acceleration, or any other notice or declaration of
any kind, all of which are hereby expressly waived by each Borrower and each
Restricted Person who at any time ratifies or approves this Agreement.  Upon any such acceleration, any obligation
of any Lender to make any further Loans and any obligation of any LC Issuer to
issue Letters of Credit hereunder to or for the account of such Borrower shall
be permanently terminated.  During the
continuance of any other Event of Default, Administrative Agent at any time and
from time to time may (and upon written instructions from Majority Lenders,
Administrative Agent shall), without notice to any Borrower or any other
Restricted Person, do either or both of the following:  (1) terminate or suspend any obligation of
Lenders to make Loans hereunder and any obligation of any LC Issuer to issue
Letters of Credit hereunder, and (2) declare any or all of the Obligations
immediately due and payable, and all

 

69

 

such Obligations shall
thereupon be immediately due and payable, without demand, presentment, notice
of demand or of dishonor and nonpayment, protest, notice of protest, notice of
intention to accelerate, declaration or notice of acceleration, or any other
notice or declaration of any kind, all of which are hereby expressly waived by
each Borrower and each Restricted Person who at any time ratifies or approves
this Agreement.  If the Obligations or
any part thereof become immediately due and payable pursuant to the foregoing,
then, unless all Lenders otherwise specifically elect to the contrary (which
election may thereafter be retracted by any Lender at any time), all LC
Obligations shall become immediately due and payable without regard to whether
or not actual drawings or payments on the Letters of Credit have occurred, and
each Borrower shall be obligated to immediately pay to the appropriate LC
Issuer an amount equal to the aggregate LC Obligations which are then
outstanding with respect to Letters of Credit issued by such LC Issuer at the
request of such Borrower, to be held by such LC Issuer and applied to such LC
Obligations as they mature.

 

Section 8.2.  Remedies.  If any Default shall occur and be continuing, each Lender Party
may protect and enforce its rights under the Loan Documents by any appropriate
proceedings, including proceedings for specific performance of any covenant or
agreement contained in any Loan Document, and each Lender Party may enforce the
payment of any Obligations due it or enforce any other legal or equitable right
which it may have.  All rights, remedies
and powers conferred upon Lender Parties under the Loan Documents shall be
deemed cumulative and not exclusive of any other rights, remedies or powers
available under the Loan Documents or at Law or in equity.

 

70

 

ARTICLE IX - Agents

 

Section 9.1.  Appointment and Authority.

 

(a)  Each Lender Party hereby irrevocably
authorizes Administrative Agent, and Administrative Agent hereby undertakes, to
receive payments of principal, interest and other amounts due hereunder as
specified herein and to take all other actions and to exercise such powers
under the Loan Documents as are specifically delegated to Administrative Agent
by the terms hereof or thereof, together with all other powers reasonably
incidental thereto.  The relationship
of  Administrative Agent to the other
Lender Parties is only that of one commercial lender acting as administrative
agent for others, and nothing in the Loan Documents shall be construed to
constitute Administrative Agent a trustee or other fiduciary for any Lender
Party or any holder of any participation in a US Note or Canadian Note nor to
impose on Administrative Agent duties and obligations other than those
expressly provided for in the Loan Documents. 
With respect to any matters not expressly provided for in the Loan
Documents and any matters which the Loan Documents place within the discretion
of Administrative Agent,  Administrative
Agent shall not be required to exercise any discretion or take any action, and
it may request instructions from Lenders with respect to any such matter, in
which case it shall be required to act or to refrain from acting (and shall be
fully protected and free from liability to all Lender Parties in so acting or
refraining from acting) upon the instructions of Majority Lenders (including
itself), provided, however, that Administrative Agent shall not be required to
take any action which exposes it to a risk of personal liability that it
considers unreasonable or which is contrary to the Loan Documents or to
applicable Law.  Upon receipt by
Administrative Agent from any Borrower of any communication calling for action
on the part of Lenders or upon notice from any Borrower or any Lender to
Administrative Agent of any Default or Event of Default, Administrative Agent
shall promptly notify each other Lender thereof.

 

(b)  Each Lender Party hereby irrevocably
authorizes Canadian Administrative Agent, and Canadian Administrative Agent
hereby undertakes, to receive payments of principal, interest and other amounts
due hereunder as specified herein and to take all other actions and to exercise
such powers under the Loan Documents as are specifically delegated to Canadian
Administrative Agent by the terms hereof or thereof, together with all other
powers reasonably incidental thereto. 
The relationship of Canadian Administrative Agent to the other Lender
Parties is only that of one commercial lender acting as administrative agent
for others, and nothing in the Loan Documents shall be construed to constitute
Canadian Administrative Agent a trustee or other fiduciary for any Lender Party
or any holder of any participation in a Canadian Working Capital Note nor to
impose on Canadian Administrative Agent duties and obligations other than those
expressly provided for in the Loan Documents. 
With respect to any matters not expressly provided for in the Loan
Documents and any matters which the Loan Documents place within the discretion
of Canadian Administrative Agent, Canadian Administrative Agent shall not be
required to exercise any discretion or take any action, and it may request
instructions from Lenders with respect to any such matter, in which case it
shall be required to act or to refrain from acting (and shall be fully
protected and free from liability to all Lender Parties in so acting or
refraining from acting) upon the instructions of Majority Lenders (including
itself), provided, however, that Canadian Administrative Agent shall not be
required to take any action which exposes it to a risk of personal liability
that it considers unreasonable or which is contrary to the Loan Documents or to
applicable Law.  Upon receipt by
Canadian Administrative Agent from any Borrower of any communication calling
for action on the part of Lenders or upon notice from

 

71

 

any Borrower or any Lender to
Canadian Administrative Agent of any Default or Event of Default, Canadian
Administrative Agent shall promptly notify each other Lender thereof.

 

Section 9.2.  Exculpation, Agent’s Reliance, Etc.  Neither any Agent nor any of its directors,
officers, agents, attorneys, or employees shall be liable for any action taken
or omitted to be taken by any of them under or in connection with the Loan
Documents, including
their negligence of any kind, except that each shall be liable for
its own gross negligence or willful misconduct.  Without limiting the generality of the foregoing, each Agent (a)
may treat the payee of any Note as the holder thereof until such Agent receives
written notice of the assignment or transfer thereof in accordance with this
Agreement, signed by such payee and in form satisfactory to such Agent; (b) may
consult with legal counsel (including counsel for any Borrower), independent
public accountants and other experts selected by it and shall not be liable for
any action taken or omitted to be taken in good faith by it in accordance with
the advice of such counsel, accountants or experts; (c) makes no warranty or
representation to any other Lender Party and shall not be responsible to any
other Lender Party for any statements, warranties or representations made in or
in connection with the Loan Documents; (d) shall not have any duty to ascertain
or to inquire as to the performance or observance of any of the terms, covenants
or conditions of the Loan Documents on the part of any Restricted Person or to
inspect the property (including the books and records) of any Restricted
Person; (e) shall not be responsible to any other Lender Party for the due
execution, legality, validity, enforceability, genuineness, sufficiency or
value of any Loan Document or any instrument or document furnished in
connection therewith; (f) may rely upon the representations and warranties of
each Restricted Person or Lender Party in exercising its powers hereunder; and
(g) shall incur no liability under or in respect of the Loan Documents by
acting upon any notice, consent, certificate or other instrument or writing
(including any facsimile, telegram, cable or telex) believed by it to be
genuine and signed or sent by the proper Person or Persons.

 

Section 9.3.  Credit Decisions.  Each Lender Party acknowledges that it has,
independently and without reliance upon any other Lender Party, made its own
analysis of US Borrower, Canadian Borrower, and Canadian Working Capital
Borrower and the transactions contemplated hereby and its own independent
decision to enter into this Agreement and the other Loan Documents.  Each Lender Party also acknowledges that it
will, independently and without reliance upon any other Lender Party and based
on such documents and information as it shall deem appropriate at the time,
continue to make its own credit decisions in taking or not taking action under
the Loan Documents.

 

Section
9.4.  Indemnification.  Each
Lender agrees to indemnify each Agent (to the extent not reimbursed by US
Borrower, Canadian Borrower, or Canadian Working Capital Borrower within ten
(10) days after demand) from and against such Lender’s Aggregate Percentage
Share of any and all liabilities, obligations, claims, losses, damages,
penalties, fines, actions, judgments, suits, settlements, costs, expenses or
disbursements (including reasonable fees of attorneys, accountants, experts and
advisors) of any kind or nature whatsoever (in this section collectively called
“liabilities and costs”) which to any extent (in whole or in part) may be
imposed on, incurred by, or asserted against such Agent growing out of,
resulting from or in any other way associated with the Loan Documents and the
transactions and events (including the enforcement thereof) at any time
associated therewith or contemplated therein and any

 

72

 

borrower’s use of
loan proceeds (whether arising in contract or in tort or otherwise and including
any violation or noncompliance with any Environmental Laws by any Person or any
liabilities or duties of any Person with respect to Hazardous Materials found
in or released into the environment).

 

The foregoing indemnification shall apply
whether or not such liabilities and costs are in any way or to any extent owed,
in whole or in part, under any claim or theory of strict liability or caused,
in whole or in part, by any negligent act or omission of any kind by any Agent,
provided only that no Lender shall be obligated under this section to indemnify
any Agent for that portion, if any, of any liabilities and costs which is
proximately caused by such Agent’s own individual gross negligence or willful
misconduct, as determined in a final judgment. 
Cumulative of the foregoing, each Lender agrees to reimburse each Agent
promptly upon demand for such Lender’s Aggregate Percentage Share of any costs
and expenses to be paid to such Agent by US Borrower, Canadian Borrower, and
Canadian Working Capital Borrower under Section 10.4(a) to the extent that
such Agent is not timely reimbursed for such expenses by such Persons as
provided in such section.  As used in
this section the term “Agent” shall refer not only to the Persons designated as
such in Section 1.1 but also to each director, officer, agent, attorney,
employee, representative and Affiliate of such Person.

 

Section 9.5.  Rights as Lender.  In its capacity as a Lender, each Agent
shall have the same rights and obligations as any Lender and may exercise such
rights as though it were not an Agent. 
Each Agent may accept deposits from, lend money to, act as trustee under
indentures of, and generally engage in any kind of business with any Restricted
Person or their Affiliates, all as if it were not Agent hereunder and without
any duty to account therefor to any other Lender.

 

Section 9.6.  Sharing of Set-Offs and Other Payments.  Each Lender Party agrees that if it shall,
whether through the exercise of rights of banker’s lien, set off, or
counterclaim against US Borrower, Canadian Borrower, or Canadian Working
Capital Borrower or otherwise, obtain payment of a portion of the aggregate
Obligations owed to it which, taking into account all distributions made by
either Agent under Section 3.1, causes such Lender Party to have received more
than it would have received had such payment been received by either Agent and
distributed pursuant to Section 3.1, then (a) it shall be deemed to have
simultaneously purchased and shall be obligated to purchase interests in the
Obligations as necessary to cause all Lender Parties to share all payments as
provided for in Section 3.1, and (b) such other adjustments shall be made from
time to time as shall be equitable to ensure that such Agent and all Lender
Parties share all payments of Obligations as provided in Section 3.1; provided,
however, that nothing herein contained shall in any way affect the right of any
Lender Party to obtain payment (whether by exercise of rights of banker’s lien,
set-off or counterclaim or otherwise) of indebtedness other than the
Obligations.  Each of US Borrower,
Canadian Borrower, and Canadian Working Capital Borrower expressly consents to
the foregoing arrangements, subject to Section 10.11.  If all or any part of any funds transferred pursuant to this section
is thereafter recovered from the seller under this section which received the
same, the purchase provided for in this section shall be deemed to have been
rescinded to the extent of such recovery, together with interest, if any, if
interest is required pursuant to the order of a Tribunal to be paid on account
of the possession of such funds prior to such recovery.

 

73

 

Section 9.7.  Investments.  Whenever either Agent in good faith
determines that it is uncertain about how to distribute to Lender Parties any
funds which it has received, or whenever either Agent in good faith determines
that there is any dispute among Lender Parties about how such funds should be
distributed, such Agent may choose to defer distribution of the funds which are
the subject of such uncertainty or dispute. 
If either Agent in good faith believes that the uncertainty or dispute
will not be promptly resolved, or if either Agent is otherwise required to
invest funds pending distribution to Lender Parties, such Agent shall invest
such funds pending distribution; all interest on any such Investment shall be
distributed upon the distribution of such Investment and in the same proportion
and to the same Persons as such Investment. 
All moneys received by any Agent for distribution to Lender Parties
(other than to the Person who is Administrative Agent in its separate capacity
as a Lender Party, or the Person who is Canadian Administrative Agent in its
separate capacity as a Lender Party) shall be held by such Agent pending such
distribution solely as such Agent for such Lender Parties, and such Agent shall
have no equitable title to any portion thereof.

 

Section 9.8.  Benefit of Article IX.  The provisions of this Article are intended solely
for the benefit of Lender Parties, and no Restricted Person shall be entitled
to rely on any such provision or assert any such provision in a claim or
defense against any Lender (other than contained in Section 9.6 or the right to
reasonably approve a successor Agent under Section 9.9).  Lender Parties may waive or amend such
provisions as they desire without any notice to or consent of any Borrower or
any other Restricted Person.

 

Section 9.9.  Resignation.

 

(a)  Administrative Agent may resign at any time
by giving written notice thereof to Lenders and US Borrower.  Each such notice shall set forth the date of
such resignation.  Upon any such
resignation Majority Lenders shall have the right to appoint a successor
Administrative Agent, subject to the approval of US Borrower, unless a Default
has occurred and is continuing, which approval will not be unreasonably
withheld.  A successor must be appointed
for any retiring Administrative Agent, and such Administrative Agent’s
resignation shall become effective when such successor accepts such
appointment.  If, within thirty days
after the date of the retiring Administrative Agent’s resignation, no successor
Administrative Agent has been appointed and has accepted such appointment, then
the retiring Administrative Agent may appoint a successor Administrative Agent,
which shall be a commercial bank organized or licensed to conduct a banking or
trust business under the Laws of the United States of America or of any state
thereof.  Upon the acceptance of any appointment
as Administrative Agent hereunder by a successor Administrative Agent, the
retiring Administrative Agent shall be discharged from its duties and
obligations under this Agreement and the other Loan Documents.  After any retiring Administrative Agent’s
resignation hereunder the provisions of this Article IX shall continue to inure
to its benefit as to any actions taken or omitted to be taken by it while it
was Administrative Agent under the Loan Documents.

 

(b)  Canadian Administrative Agent may resign at
any time by giving written notice thereof to Lenders and Canadian
Borrower.  Each such notice shall set
forth the date of such resignation. 
Upon any such resignation Majority Lenders shall have the right to
appoint a successor Canadian Administrative Agent, subject to the approval of
Canadian Working Capital Borrower, unless a Default has occurred and is
continuing, which approval will not be unreasonably withheld.  A successor must be appointed for any retiring
Canadian Administrative

 

74

 

Agent, and such Canadian
Administrative Agent’s resignation shall become effective when such successor
accepts such appointment.  If, within
sixty days after the date of the retiring Canadian Administrative Agent’s
resignation, no successor Canadian Administrative Agent has been appointed and
has accepted such appointment, then the retiring Canadian Administrative Agent
may appoint a successor Canadian Administrative Agent.  Each Canadian Administrative Agent shall be
a commercial bank organized or licensed to conduct a banking or trust business
under the Laws of the Dominion of Canada or of any province thereof.  Upon the acceptance of any appointment as
Canadian Administrative Agent hereunder by a successor Canadian Administrative
Agent, the retiring Canadian Administrative Agent shall be discharged from its
duties and obligations under this Agreement and the other Loan Documents.  After any retiring Canadian Administrative Agent’s
resignation hereunder the provisions of this Article IX shall continue to inure
to its benefit as to any actions taken or omitted to be taken by it while it
was Canadian Administrative Agent under the Loan Documents.

 

Section 9.10.  Other Agents.  Neither the Co-Syndication Agents nor the Co-Documentation
Agent (“Co-Agents”), in such capacities, shall have any duties or
responsibilities or incur any liabilities in such agency capacities (as opposed
to its capacity as a Lender) under or in connection with this Agreement or
under any of the other Loan Documents. 
The relationship between Borrowers on the one hand, and the Co-Agents
and the Agents, on the other hand, shall be solely that of borrower and
lender.  None of the Co-Agents shall
have any fiduciary responsibilities to any Borrower or any of their respective
Affiliates.  None of the Co-Agents  undertakes any responsibility to any
Borrower or any of their respective Affiliates to review or inform any such Person
of any matter in connection with any phase of such Person’s or such Affiliate’s
business or operations.

 

ARTICLE X - Miscellaneous

 

Section 10.1.  Waivers and Amendments; Acknowledgments.

 

(a)  Waivers and Amendments.  No failure or delay (whether by course of

 

75

 

conduct or otherwise) by any
Lender in exercising any right, power or remedy which such Lender Party may
have under any of the Loan Documents shall operate as a waiver thereof or of
any other right, power or remedy, nor shall any single or partial exercise by
any Lender Party of any such right, power or remedy preclude any other or
further exercise thereof or of any other right, power or remedy.  No waiver of any provision of any Loan
Document and no consent to any departure therefrom shall ever be effective
unless it is in writing and signed as provided below in this section, and then
such waiver or consent shall be effective only in the specific instances and
for the purposes for which given and to the extent specified in such
writing.  This Agreement and the other
Loan Documents set forth the entire understanding between the parties hereto
with respect to the transactions contemplated herein and therein and supersede
all prior discussions and understandings with respect to the subject matter
hereof and thereof, and no waiver, consent, release, modification or amendment
of or supplement to this Agreement or the other Loan Documents shall be valid
or effective against any party hereto unless the same is in writing and signed
by (i) if such party is a Borrower, by such Borrower, (ii) if such party is
Administrative Agent, Canadian Administrative Agent, US LC Issuer, or Canadian
LC Issuer, by such party, and (iii) if such party is a Lender, by such Lender
or by relevant Agent on behalf of Lenders with the written consent of Majority
Lenders (which consent has already been given as to the termination of the Loan
Documents as provided in Section 10.12). 
Notwithstanding the foregoing or anything to the contrary herein,
Administrative Agent shall not, without the prior consent of each individual
Lender, execute and deliver on behalf of such Lender any waiver or amendment
which would:  (1) waive any of the
conditions specified in Article IV (provided that Administrative Agent may in
its discretion withdraw any request it has made under Section 4.1(i)), (2)
increase the maximum amount which such Lender is committed hereunder to lend,
or extend the termination date of such Lender’s commitment to lend, (3) reduce
any fees payable to such Lender hereunder, or the principal of, or interest on,
such Lender’s Note, (4) change any date fixed for any payment of any such
fees, principal or interest, or change Section 9.6 in a manner that would alter
pro rata sharing of payments required thereby, (5) amend the definition herein
of “Majority Lenders” or otherwise change the Aggregate Percentage Shares which
are required for Administrative Agent, Canadian Administrative Agent, Lenders
or any of them to take any particular action under the Loan Documents, or (6)
except as expressly provided herein or in any other Loan Document, release (i)
any Borrower from its obligation to pay such Lender’s Note, (ii) any Guarantor
from its guaranty of such payment or (iii) any Restricted Person from the
negative pledge covenant set forth in Section 7.11 hereof.

 

(b)  Acknowledgments and Admissions.  Each Borrower hereby represents, warrants,
acknowledges and admits that  (i) it has
been advised by counsel in the negotiation, execution and delivery of the Loan
Documents to which it is a party, (ii) no Lender Party has any fiduciary
obligation toward such Borrower with respect to any Loan Document or the
transactions contemplated thereby, (iii) the relationship pursuant to the Loan
Documents between such Borrower and the other Restricted Persons, on one hand,
and each Lender Party, on the other hand, is and shall be solely that of debtor
and creditor, respectively, and (iv) no partnership or joint venture exists
with respect to the Loan Documents between any Restricted Person and any Lender
Party.

 

(c)  Representation by Lenders.  Each Lender hereby represents that it will
acquire its Notes for its own account in the ordinary course of its commercial
lending or investing business; however, the disposition of such Lender’s
property shall at all times be and remain within its control and, in particular
and without limitation, such Lender may sell or

 

76

 

otherwise transfer its Note,
any participation interest or other interest in its Note, or any of its other
rights and obligations under the Loan Documents subject to compliance with
Sections 10.5(b) through (f), inclusive, and applicable Law.

 

(d)  Joint Acknowledgment.  This
written Agreement and the

other Loan Documents represent the final
agreement between the parties and may not be contradicted by evidence of prior,
contemporaneous, or subsequent oral agreements of the parties.

 

There are no
unwritten oral agreements between the parties.

 

(e)  Annual Rates of Interest.  For the purposes of the Interest Act (Canada), whenever interest
payable pursuant to this Agreement is calculated on the basis of a period other
than a calendar year (in this Section 10.1(e), the “Interest Period”), each
rate of interest determined pursuant to such calculation expressed as an annual
rate is equivalent to such rate as so determined multiplied by the actual
number of days in the calendar year in which the same is to be ascertained and
divided by the number of days in the Interest Period.

 

Section 10.2.  Survival of Agreements; Cumulative Nature.
 All of Restricted Persons’ various
representations, warranties, covenants and agreements in the Loan Documents
shall survive the execution and delivery of this Agreement and the other Loan
Documents and the performance hereof and thereof, including the making or
granting  of the Loans and the delivery
of the Notes and the other Loan Documents, and shall further survive until all
of the Obligations are paid in full to each Lender Party and all of Lender
Parties’ obligations to Borrowers are terminated.  The rights, powers, and privileges granted to Lender Parties in
the Loan Documents, are cumulative, and, except for expressly specified waivers
and consents, no Loan Document shall be construed in the context of another to
diminish, nullify, or otherwise reduce the benefit to any Lender Party of any
such right, power or privilege.

 

Section 10.3.  Notices.  All notices, requests, consents, demands and other communications
required or permitted under any Loan Document shall be in writing, unless
otherwise specifically provided in such Loan Document (provided that each Agent
may give telephonic notices to the other Lender Parties), and shall be deemed
sufficiently given or furnished if delivered by personal delivery, by facsimile
or other electronic transmission, by delivery service with proof of delivery,
or by registered or certified United States mail, postage prepaid, to Borrowers
and Restricted Persons at the address of Borrowers specified on the signature
pages hereto and to each Lender Party at its address specified on the signature
pages hereto (unless changed by similar notice in writing given by the
particular Person whose address is to be changed).  Any such notice or communication shall be deemed to have been
given (a) in the case of personal delivery or delivery service, as of the date
of first attempted delivery during normal business hours at the address
provided herein, (b) in the case of facsimile or other electronic transmission,
upon receipt, or (c) in the case of registered or certified United States mail,
three days after deposit in the mail; provided, however, that no Borrowing
Notice or Continuation/Conversion Notice shall become effective until actually
received by the relevant Agent.

 

77

 

Section 10.4.  Payment of Expenses; Indemnity.

 

(a)  Payment of Expenses.  Whether or not the transactions contemplated
by this Agreement are consummated, each Borrower will promptly (and in any
event, within 30 days after any invoice or other statement or notice) pay: (i)
all transfer, stamp, mortgage, documentary or other similar taxes, assessments
or charges levied by any governmental or revenue authority in respect of this
Agreement or any of the other Loan Documents or any other document referred to
herein or therein, (ii) all reasonable costs and expenses incurred by or on
behalf of Administrative Agent (including attorneys’ fees, consultants’ fees
and engineering fees, travel costs and miscellaneous expenses) in connection
with (1) the negotiation, preparation, execution and delivery of the Loan
Documents, and any and all consents, waivers or other documents or instruments
relating thereto, (2) the filing, recording, refiling and re-recording of any
Loan Documents and any other documents or instruments or further assurances
required to be filed or recorded or refiled or re-recorded by the terms of any
Loan Document, (3) the borrowings hereunder and other action reasonably
required in the course of administration hereof, (4) monitoring or confirming
(or preparation or negotiation of any document related to) such Borrower’s
compliance with any covenants or conditions contained in this Agreement or in
any Loan Document, and (iii) all reasonable costs and expenses incurred by or
on behalf of any Lender Party (including attorneys’ fees, consultants’ fees and
accounting fees) in connection with the defense or enforcement of any of the
Loan Documents (including this section) or the defense of any Lender Party’s
exercise of its rights thereunder.  In
addition to the foregoing, until all Obligations have been paid in full, each
Borrower will also pay or reimburse Administrative Agent for all reasonable
out-of-pocket costs and expenses of Administrative Agent or its agents or
employees in connection with the continuing administration of the Loans and the
related due diligence of Administrative Agent, including travel and
miscellaneous expenses and fees and expenses of Administrative Agent’s outside
counsel and consultants engaged in connection with the Loan Documents.

 

(b)  Indemnity.  Each Borrower agrees to indemnify each Lender Party, upon demand,
from and against any and all liabilities, obligations, claims, losses, damages,
penalties, fines, actions, judgments, suits, settlements, costs, expenses or
disbursements (including reasonable fees of attorneys, accountants, experts and
advisors) of any kind or nature whatsoever (in this section collectively called
“liabilities and costs”) which to any extent (in whole or in part) may be
imposed on, incurred by, or asserted against such Lender Party growing out of,
resulting from or in any other way associated with the Loan Documents and the
transactions and events (including the enforcement or defense thereof) at any
time associated therewith or contemplated therein and any Borrower’s use of
Loan proceeds (whether arising in contract or in tort or otherwise and
including any violation or noncompliance with any Environmental Laws by any
Lender Party or any other Person or any liabilities or duties of any Lender
Party or any other Person with respect to Hazardous Materials found in or
released into the environment).

 

The foregoing indemnification shall apply
whether or not such liabilities and costs are in any way or to any extent owed,
in whole or in part, under any claim or theory of strict liability or caused,
in whole or in part, by any negligent act or omission of any kind by any Lender
Party, provided only that no Lender Party shall be
entitled under this section to receive indemnification for that portion, if
any, of any liabilities and costs which is proximately caused by its own
individual gross negligence or willful misconduct, as determined in a final
judgment.  If any Person (including any
Borrower or any of its Affiliates) ever alleges such gross negligence or
willful misconduct by any Lender Party, the indemnification provided for in
this section shall nonetheless be paid upon demand, subject to

 

78

 

later adjustment or
reimbursement, until such time as a court of competent jurisdiction enters a
final judgment as to the extent and effect of the alleged gross negligence or
willful misconduct.  As used in this
section the term “Lender Party” shall refer not only to each Person designated
as such in Section 1.1 but also to each director, officer, trustee, agent,
attorney, employee, representative and Affiliate of such Persons.

 

(c)  Interest.  Each Borrower hereby promises to each Lender Party interest at
the Default Rate on all Obligations to pay fees or to reimburse or indemnify
any Lender Party which such Borrower has promised to pay to such Lender Party
pursuant to this Section 10.4 and which are not paid when due.  Such interest shall accrue from the date
such Obligations become due until they are paid.

 

Section 10.5.  Joint and Several Liability; Parties in
Interest; Assignments; Replacement Notes.

 

(a)  All Obligations which are incurred by two or
more Restricted Persons shall be their joint and several obligations and
liabilities of such Restricted Persons. 
All grants, covenants and agreements contained in the Loan Documents
shall bind and inure to the benefit of the parties thereto and their respective
successors and permitted assigns; provided, however, that no Restricted Person
may assign or transfer any of its rights or delegate any of its duties or
obligations under any Loan Document without the prior consent of all
Lenders.  Neither any Borrower nor any
Affiliates of any Borrower shall directly or indirectly purchase or otherwise
retire any Obligations owed to any Lender nor will any Lender accept any offer
to do so, unless each Lender shall have received substantially the same offer
with respect to the same Percentage Share of the Obligations owed to it.  If any Borrower or any Affiliate of any
Borrower at any time purchases some but less than all of the Obligations owed
to all Lender Parties, such purchaser shall not be entitled to any rights of
any Lender under the Loan Documents unless and until such Borrower or its
Affiliates have purchased all of the Obligations.

 

(b)  No Lender shall sell any participation
interest in its commitment hereunder or any of its rights under its Loans or
under the Loan Documents to any Person unless the agreement between such Lender
and such participant at all times provides: (i) that such participation exists
only as a result of the agreement between such participant and such Lender and
that such transfer does not give such participant any right to vote as a Lender
or any other direct claims or rights against any Person other than such Lender,
(ii) that such participant is not entitled to payment from any Restricted
Person under Sections 3.2 through 3.6 of amounts in excess of those payable to
such Lender under such sections (determined without regard to the sale of such
participation), and (iii) unless such participant is an Affiliate of such
Lender, that such participant shall not be entitled to require such Lender to
take any action under any Loan Document or to obtain the consent of such
participant prior to taking any action under any Loan Document, except for
actions which would require the consent of all Lenders under subsection (a) of
Section 10.1.  No Lender selling such a
participation shall, as between the other parties hereto and such Lender, be
relieved of any of its obligations hereunder as a result of the sale of such
participation.  Each Lender which sells
any such participation to any Person (other than an Affiliate of such Lender)
shall give prompt notice thereof to Administrative Agent and the relevant
Borrower; provided, however, that no liability shall arise if any such Lender
fails to give such notice to such Borrower.

 

79

 

(c)  Except for sales of participations under the
immediately preceding subsection, no Lender shall make any assignment or
transfer of any kind of its commitments or any of its rights under its Loans or
under the Loan Documents, except for assignments to an Eligible Transferee or,
subject to the provisions of Subsection (g) below, to an affiliate, and then
only if such assignment is made in accordance with the following requirements:

 

(i)  In the case of an
assignment by a US Lender or Canadian Lender of less than all of its Loans, LC
Obligations, and Commitments, each such assignment shall apply to a consistent
percentage of all Loans and LC Obligations owing to the assignor Lender
hereunder and to the same percentage of the unused portion of the assignor
Lender’s Commitments, so that after such assignment is made both the assignee
Lender and the assignor Lender shall have a fixed (and not a varying)
Percentage Share in its Loans and LC Obligations and be committed to make that
Percentage Share of all future Loans and make that Percentage Share of all
future participations in LC Obligations, and the Percentage Share of such US
Commitment, Canadian Commitment or Canadian Working Capital Commitment of each
of the assignor and assignee shall equal or exceed $5,000,000.

 

(ii)  The parties to each such
assignment shall execute and deliver to Administrative Agent (and, as to
assignments of Canadian Obligations, Canadian Administrative Agent), for its
acceptance and recording in the “Register” (as defined below in this section),
an Assignment and Acceptance in the form of Exhibit G, appropriately completed,
together with the Note subject to such assignment and a processing fee payable
by such assignor Lender (and not at Borrower’s expense) to Administrative Agent
of $3,500.  Upon such execution,
delivery, and payment and upon the satisfaction of the conditions set out in
such Assignment and Acceptance, then (i) the relevant Borrower shall issue new
Notes to such assignor and assignee upon return of the old Notes to the
relevant Borrower, and (ii) as of the “Settlement Date” specified in such
Assignment and Acceptance the assignee thereunder shall be a party hereto and a
Lender hereunder and Administrative Agent shall thereupon deliver to the
relevant Borrower and each Lender a revised Schedule 1 hereto showing the
revised Percentage Shares and total Percentage Shares of such assignor Lender
and such assignee Lender and the revised Percentage Shares and total Percentage
Shares of all other Lenders.

 

(iii)  Each assignee US Lender
which is not a United States person (as such term is defined in Section
7701(a)(30) of the Code) for Federal income tax purposes, shall (to the extent
it has not already done so) provide Administrative Agent and US Borrower with
the “Prescribed Forms” referred to in Section 3.7(d).

 

(iv)  Each assignee Canadian
Lender shall be a financial institution that is (i) not a non-resident of
Canada for the purposes of the Income Tax
Act (Canada);  or (ii) an
“authorized foreign bank” as defined in section 2 of the Bank Act (Canada) and in subsection 248(1)
of the Income Tax Act (Canada),
that is not subject to the restrictions and requirements referred to in
subsection 524(2) of the Bank Act
(Canada) and which will receive all amounts paid or credited to it under its
Canadian Loans and Canadian Working Capital Note in respect of its “Canadian
banking business” for the purposes of paragraph 212(13.3)(a) of the Income Tax Act (Canada).

 

80

 

(d)  Any Lender may at any time pledge all or any
portion of its Loan and Note (and related rights under the Loan Documents
including any portion of its Note) to any of the twelve (12) Federal Reserve
Banks organized under Section 4 of the Federal Reserve Act, 12 U.S.C. Section
341.  No such pledge or enforcement
thereof shall release any such Lender from its obligations under any of the
Loan Documents; provided that all related costs, fees and expenses in
connection with any such pledge shall be for the sole account of such Lender.

 

(e)  By executing and delivering an Assignment
and Acceptance, each assignee Lender thereunder will be confirming to and
agreeing with the relevant Borrower, Agent and each other Lender Party that
such assignee understands and agrees to the terms hereof, including Article IX
hereof.

 

(f)
Administrative Agent (and with respect to Canadian Obligations, Canadian
Administrative Agent,) shall maintain a copy of each Assignment and Acceptance
and a register for the recordation of the names and addresses of Lenders and
the Percentage Shares of, and principal amount of the Loans owing to, each
Lender from time to time (in this section called the “Register”).  The entries in the Register shall be
conclusive, in the absence of manifest error, and Borrowers and each Lender
Party may treat each Person whose name is recorded in the Register as a Lender
Party hereunder for all purposes.  The
Register shall be available for inspection by Borrowers or any Lender Party at
any reasonable time and from time to time upon reasonable prior notice.

 

(g)  Any Lender may assign or transfer its
commitment or its rights under its Loans or under the Loan Documents to
(i) any Affiliate that is wholly-owned direct or indirect subsidiary of
such Lender or of any Person that wholly owns, directly or indirectly, such
Lender, or (ii) if such Lender is a fund that makes or invests in bank
loans, any other fund that makes or invests in bank loans and is advised or
managed by (A) the same investment advisor as any Lender or (B) any
Affiliate of such investment advisor that is a wholly-owned direct or indirect
subsidiary of any Person that wholly owns, directly or indirectly, such
investment advisor, subject to the following additional conditions (x), (y) and
(z), with respect to assignments pursuant to clause (i) above, and subject to
the following additional conditions (y) and (z) with respect to assignments
pursuant to clause (ii) above:

 

(x)  any right of such Lender
assignor and such assignee to vote as a Lender, or any other direct claims or
rights against any other Persons, shall be uniformly exercised by both such
assignor and assignee or pursued in the manner that such Lender assignor would
have so exercised such vote, claim or right if it had not made such assignment
or transfer;

 

(y)  such assignee shall not be
entitled to payment from any Restricted Person under Sections 3.2 through 3.7
of amounts in excess of those payable to such Lender assignor under such
sections (determined without regard to such assignment or transfer); and

 

(z)  if such Lender assignor is
a Lender that assigns or transfers to such assignee any of such Lender
Commitment, assignee may become primarily liable for such Commitment, but such
assignment or transfer shall not relieve or release such Lender from such
Commitment.

 

81

 

(h)  Upon receipt of an affidavit reasonably
satisfactory to Borrower of an officer of any Lender as to the loss, theft,
destruction or mutilation of its Note which is not of public record, and, in
the case of any such loss, theft, destruction or mutilation, upon cancellation
of such Note, Borrower will execute and deliver, in lieu thereof, a replacement
Note in the same principal amount thereof and otherwise of like tenor.

 

Section 10.6.  Confidentiality.  Each Lender Party agrees (on behalf of
itself and each of its Affiliates, and each of its and their directors,
officers, agents, attorneys, employees, and representatives) that it (and each
of them) will take all reasonable steps to keep confidential any non-public
information supplied to it by or at the direction of any Restricted Person so
identified when delivered, provided, however, that this restriction shall not
apply to (a) information which has at the time in question entered the public
domain, other than as a result of a breach of this Section 10.6, (b)
information which is required to be disclosed by Law (whether valid or invalid)
of any Tribunal, (c) any disclosure to any Lender Party’s Affiliates, auditors,
attorneys or agents (provided each such Person first agrees to hold such
information in confidence on the terms provided in this Section 10.6), (d) any
disclosure to any other Lender Party or to any purchaser or prospective
purchaser of participations or other interests in any Loan or Loan Document
(provided each such Person first agrees to hold such information in confidence
on the terms provided in this section), or (e) any disclosure in the course of
enforcing its rights and remedies during the existence of an Event of
Default.  Notwithstanding anything
herein to the contrary, confidential information shall not include, and each
Lender Party and Restricted Person may disclose and may permit to be disclosed
to any and all Persons, without limitation of any kind, the “tax treatment” and
“tax structure” (in each case, within the meaning of Treasury Regulation
Section 1.6011-4) of the transactions contemplated hereby and all
materials of any kind (including opinions or other tax analyses) that are or
have been provided to such Lender Party or Restricted Person relating to such
tax treatment and tax structure.

 

Section 10.7.  Governing Law; Submission to Process.  Except to the extent that the Law of another jurisdiction is
expressly elected in a Loan Document, the Loan Documents shall be deemed
contracts and instruments made under the Laws of the State of New York and
shall be construed and enforced in accordance with and governed by the Laws of
the State of New York and the Laws of the United States of America, without
regard to principles of conflicts of law. 
Each Borrower hereby agrees that any legal action or proceeding against such
Borrower with respect to this Agreement, the Notes or any of the Loan Documents
may be brought in the courts of the State of New York or of the United States
of America for the Southern District of New York as Lender Parties may elect,
and, by execution and delivery hereof, each Borrower accepts and consents for
itself and in respect to its property, generally and unconditionally, the
non-exclusive jurisdiction of the aforesaid courts.  Each Borrower agrees that Sections 5-1401 and 5-1402 of the
General Obligations Law of the State of New York shall apply to the Loan
Documents and waives any right to stay or to dismiss any action or proceeding
brought before said courts on the basis of forum non conveniens.  In furtherance of the foregoing, each
Borrower hereby irrevocably designates and appoints Corporation Service
Company, 80 State Street, Albany, New York 12207, as agent of such Borrower to
receive service of all process brought against such Borrower with respect to
any such proceeding in any such court in New York, such service being hereby

 

82

 

acknowledged by such
Borrower to be effective and binding service in every respect.  Copies of any such process so served shall
also, if permitted by Law, be sent by registered mail to the relevant Borrower
at its address set forth below, but the failure of such Borrower to receive
such copies shall not affect in any way the service of such process as
aforesaid.  Each Borrower shall furnish
to Lender Parties a consent of Corporation Service Company agreeing to act
hereunder prior to the effective date of this agreement.  Nothing herein shall affect the right of
Lender Parties to serve process in any other manner permitted by Law or shall
limit the right of Lender Parties to bring proceedings against any Borrower in
the courts of any other jurisdiction. 
If for any reason Corporation Service Company shall resign or otherwise
cease to act as any Borrower’s agent, each Borrower hereby irrevocably agrees
to (a) immediately designate and appoint a new agent acceptable to
Administrative Agent to serve in such capacity and, in such event, such new
agent shall be deemed to be substituted for Corporation Service Company for all
purposes hereof and (b) promptly deliver to Administrative Agent the written
consent (in form and substance satisfactory to Administrative Agent) of such
new agent agreeing to serve in such capacity.

 

Section 10.8.  Waiver of Judgment Interest Act (Alberta).  To the extent permitted by Law, the provisions
of the Judgment Interest Act (Alberta) shall not apply to the Canadian Notes,
the Canadian Working Capital Notes, and the other Loan Documents and are hereby
expressly waived by Canadian Borrower and Canadian Working Capital Borrower.

 

Section 10.9.  Deemed Reinvestment Not Applicable.  For the purposes of the Interest Act
(Canada), the principle of deemed reinvestment of interest shall not apply to
any interest calculation under the Loan Documents, and the rates of interest
stipulated in this Agreement are intended to be nominal rates and not effective
rates or yields.

 

Section 10.10.  Limitation on Interest.  Lender Parties, Restricted Persons and any
other parties to the Loan Documents intend to contract in strict compliance
with applicable usury Law from time to time in effect.  In furtherance thereof such Persons
stipulate and agree that none of the terms and provisions contained in the Loan
Documents shall ever be construed to create a contract to pay, for the use,
forbearance or detention of money, interest in excess of the maximum amount of
interest permitted to be contracted for, charged, or received by applicable Law
from time to time in effect.  Neither
any Restricted Person nor any present or future guarantors, endorsers, or other
Persons hereafter becoming liable for payment of any Obligation shall ever be
liable for unearned interest thereon or shall ever be required to pay interest
thereon in excess of the maximum amount that may be lawfully contracted for,
charged, or received under applicable Law from time to time in effect, and the
provisions of this section shall control over all other provisions of the Loan
Documents which may be in conflict or apparent conflict herewith.  Lender Parties expressly disavow any
intention to contract for, charge, or receive excessive unearned interest or
finance charges in the event the maturity of any Obligation is
accelerated.  If (a) the maturity
of any Obligation is accelerated for any reason, (b) any Obligation is
prepaid and as a result any amounts held to constitute interest are determined
to be in excess of the legal maximum, or (c) any Lender or any other
holder of any or all of the Obligations shall otherwise collect moneys which
are determined to constitute interest which would otherwise increase the
interest on any or all of the Obligations to an amount in excess of that
permitted to

 

83

 

be contracted for, charged or received by applicable Law then in
effect, then all sums determined to constitute interest in excess of such legal
limit shall, without penalty, be promptly applied to reduce the then
outstanding principal of the related Obligations or, at such Lender’s or
holder’s option, promptly returned to Borrower or other payor thereof upon such
determination.  In determining whether
or not the interest paid or payable, under any specific circumstance, exceeds
the maximum amount permitted under applicable Law, Lender Parties and
Restricted Persons (and any other payors thereof) shall to the greatest extent
permitted under applicable Law, (i) characterize any non-principal payment
as an expense, fee or premium rather than as interest, (ii) exclude
voluntary prepayments and the effects thereof, and (iii) amortize,
prorate, allocate, and spread the total amount of interest throughout the
entire contemplated term of the instruments evidencing the Obligations in
accordance with the amounts outstanding from time to time thereunder and the
maximum legal rate of interest from time to time in effect under applicable Law
in order to lawfully charge the maximum amount of interest permitted under
applicable Law.  In the event applicable
Law provides for an interest ceiling under Chapter 303 of the Texas Finance
Code (the “Texas Finance Code”) as amended, to the extent that the Texas
Finance Code is mandatorily applicable to any Lender, for that day, the ceiling
shall be the “weekly ceiling” as defined in the Texas Finance Code, provided
that if any applicable Law permits greater interest, the Law permitting the greatest
interest shall apply.  In no event shall
Chapter 346 of the Texas Finance Code apply to this Agreement or any other Loan
Document, or any transactions or loan arrangement provided or contemplated
hereby or thereby.  In no event shall
the aggregate “interest” (as defined in section 347 of the Criminal Code
(Canada)) payable under the Loan Documents exceed the maximum effective annual
rate of interest on the “credit advanced” (as defined in that section)
permitted under that section and, if any payment, collection or demand pursuant
to this Agreement in respect of “interest” (as defined in that section) is
determined to be contrary to the provisions of that section, such payment,
collection or demand shall be deemed to have been made by mutual mistake of Borrowers,
Agents and Lenders and the amount of such excess payment or collection shall be
refunded to the relevant Borrower.  For
purposes of the Canadian Notes and the Canadian Working Capital Notes, the
effective annual rate of interest shall be determined in accordance with
generally accepted actuarial practices and principles over the term applicable
thereto on the basis of annual compounding of the lawfully permitted rate of
interest and, in the event of dispute, a certificate of a Fellow of the Canadian
Institute of Actuaries appointed by Canadian Administrative Agent shall be prima facie evidence, for the purposes of
such determination.

 

Section 10.11.  Right of Offset.  At any time and from time to time during the
continuance of any Event of Default, each Lender is hereby authorized to offset
against the Obligations then due and payable (without notice to any Restricted
Person), (a) any and all moneys, securities or other property (and the proceeds
therefrom) of such Restricted Person now or hereafter held or received by or in
transit to any Lender from or for the account of such Restricted Person,
whether for safekeeping, custody, pledge, transmission, collection or
otherwise, (b) any and all deposits (general or special, time or demand,
provisional or final) of such Restricted Person with any Lender, and (c) any
other credits and claims of such Restricted Person at any time existing against
any Lender, including claims under certificates of deposit.

 

Section 10.12.  Termination; Limited Survival.  In its sole and absolute discretion
US Borrower may at any time that no Obligations are owing or outstanding
elect in a written notice delivered to Administrative Agent to terminate this
Agreement.  Upon receipt by
Administrative Agent of such a notice, if no Obligations are then owing or
outstanding this

 

84

 

Agreement and all other Loan Documents shall thereupon be terminated
and the parties thereto released from all prospective obligations
thereunder.  Notwithstanding the
foregoing or anything herein to the contrary, any waivers or admissions made by
any Restricted Person in any Loan Document, any Obligations under Sections 3.2
through 3.6, and any obligations which any Person may have to indemnify or
compensate any Lender Party shall survive any termination of this Agreement or
any other Loan Document.  At the request
and expense of Borrower, Administrative Agent shall prepare and execute all
necessary instruments to reflect and effect such termination of the Loan
Documents.  Administrative Agent is
hereby authorized to execute all such instruments on behalf of all Lenders,
without the joinder of or further action by any Lender.

 

Section 10.13.  Severability.  If any term or provision of any Loan
Document shall be determined to be illegal or unenforceable all other terms and
provisions of the Loan Documents shall nevertheless remain effective and shall
be enforced to the fullest extent permitted by applicable Law.

 

Section 10.14.  Counterparts.  This Agreement may be separately executed in
any number of counterparts and by different parties hereto in separate
counterparts, each of which when so executed shall be deemed to constitute one
and the same Agreement.

 

Section 10.15.  Waiver of Jury Trial, Punitive Damages,
etc.  Restricted Persons and Lender Parties mutually
hereby knowingly, voluntarily, and intentionally waive the right to a trial by
jury in respect of any claim based hereon, arising out of, under or in
connection with, this Agreement or any other Loan Documents contemplated to be
executed in connection herewith or any course of conduct, course of dealings,
statements (whether verbal or written) or actions of any party.  This waiver constitutes a material inducement
for Lenders to enter into this Agreement and the other Loan Documents and make
the Loans.  Each Borrower and each
Lender Party hereby further (a) irrevocably waives, to the maximum extent not
prohibited by Law, any right it may have to claim or recover in any such
litigation any “Special Damages,” as defined below, (b) certifies that no party
hereto nor any representative or agent or counsel for any party hereto has
represented, expressly or otherwise, or implied that such party would not, in
the event of litigation, seek to enforce the foregoing waivers, and (c)
acknowledges that it has been induced to enter into this Agreement, the other
Loan Documents and the transactions contemplated hereby and thereby by, among
other things, the mutual waivers and certifications contained in this section.  As used in this section, “Special Damages”
includes all special, consequential, exemplary, or punitive damages (regardless
of how named), but does not include any payments or funds which any party
hereto has expressly promised to pay or deliver to any other party hereto.

 

[REMAINDER OF PAGE
INTENTIONALLY LEFT BLANK.]

 

85

 

IN WITNESS
WHEREOF, this Agreement is executed as of the date first written above.

 

	
  US BORROWER:

  	
  PLAINS ALL
  AMERICAN PIPELINE, L.P.

  
	
   

  
	
   

  	
  By:

  	
  PLAINS AAP,
  L.P.,

  
	
   

  	
  its general
  partner

  
	
   

  
	
   

  	
  By:

  	
  PLAINS ALL
  AMERICAN GP LLC,

  
	
   

  	
  its general
  partner

  
	
   

  
	
   

  	
  By:

  	
  /s/ Al Swanson

  	
   

  
	
   

  	
  Al Swanson,
  Treasurer

  
	
   

  
	
   

  
	
  CANADIAN BORROWER:

  	
  PMC (NOVA
  SCOTIA) COMPANY

  
	
   

  
	
   

  	
  By:

  	
  /s/ Al Swanson

  	
   

  
	
   

  	
  Al Swanson,
  Treasurer

  
	
   

  
	
  CANADIAN WORKING

  	
   

  
	
  CAPITAL BORROWER:

  	
  PLAINS
  MARKETING CANADA, L.P.

  
	
   

  
	
   

  	
  By:

  	
  PMC (Nova
  Scotia) Company,

  
	
   

  	
  its general
  partner

  
	
   

  
	
   

  	
  By:

  	
  /s/ Al Swanson

  	
   

  
	
   

  	
  Al Swanson,
  Treasurer

  
	
   

  
	
  GUARANTOR:

  	
  PLAINS ALL
  AMERICAN PIPELINE, L.P.

  
	
   

  
	
   

  	
  By:

  	
  PLAINS AAP,
  L.P.,

  
	
   

  	
  its general
  partner

  
	
   

  
	
   

  	
  By:

  	
  PLAINS ALL
  AMERICAN GP LLC,

  
	
   

  	
  its general
  partner

  
	
   

  
	
   

  	
  By:

  	
  /s/ Al Swanson

  	
   

  
	
   

  	
  Al Swanson,
  Treasurer

  
	
   

  
	
  Address for
  Borrowers and Guarantors:

  	
  333 Clay
  Street, Suite 1600

  
	
   

  	
  Houston,
  Texas 77002

  
	
   

  	
  Attention:
  Al Swanson

  
	
   

  	
  Telephone:
  (713) 646-4455

  
	
   

  	
  Fax: (713)
  646-4564

  
	
   

  	
  Website:
  www.paalp.com

  
					

 

86

 

	
   

  	
  FLEET
  NATIONAL BANK,

  
	
   

  	
  Administrative
  Agent, LC Issuer and a Lender

  
	
   

  
	
   

  
	
   

  	
  By:

  	
  /s/ Terrence Ronan

  	
   

  
	
   

  	
  Terrence
  Ronan, Managing Director

  
	
   

  
	
   

  
	
   

  	
  FLEET SECURITIES,
  INC.,

  
	
   

  	
  Lead
  Arranger and Book Manager

  
	
   

  
	
   

  
	
   

  	
  By:

  	
  /s/ Michael P. Hannon

  	
   

  
	
   

  	
  Michael P.
  Hannon, Managing Director

  

 

S-1

 

	
   

  	
  WACHOVIA
  BANK NATIONAL

  ASSOCIATION,

  
	
   

  	
  Co-Syndication
  Agent and a Lender

  
	
   

  
	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
  Name:

  
	
   

  	
  Title:

  
					

 

S-2

 

	
   

  	
  BANK ONE,
  NA,

  
	
   

  	
  Co-Syndication
  Agent and a Lender

  
	
   

  
	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
  Name:

  
	
   

  	
  Title:

  
					

 

S-3

 

	
   

  	
  BANK OF
  AMERICA, N.A.,

  
	
   

  	
  Co-Documentation
  Agent and a Lender

  
	
   

  
	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
  Name:

  
	
   

  	
  Title:

  
					

 

S-4

 

	
   

  	
  FORTIS
  CAPITAL CORP.

  
	
   

  	
  Co-Documentation
  Agent and a Lender

  
	
   

  
	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
  Name:

  
	
   

  	
  Title:

  
	
   

  
	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
  Name:

  
	
   

  	
  Title:

  
					

 

S-5

 

	
   

  	
  BNP PARIBAS,

  
	
   

  	
  Senior
  Managing Agent and a Lender

  
	
   

  
	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
  Name:

  
	
   

  	
  Title:

  
	
   

  
	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
  Name:

  
	
   

  	
  Title:

  
	
   

  
	
   

  
	
   

  	
  BNP PARIBAS
  (CANADA), a Canadian Lender

  
	
   

  
	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
  Name:

  
	
   

  	
  Title:

  
	
   

  
	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
  Name:

  
	
   

  	
  Title:

  
					

 

S-6

 

	
   

  	
  THE BANK OF
  NOVA SCOTIA,

  
	
   

  	
  Senior
  Managing Agent and a Lender

  
	
   

  
	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
  Name:

  
	
   

  	
  Title:

  
	
   

  
	
   

  
	
   

  	
  THE BANK OF
  NOVA SCOTIA,

  
	
   

  	
  as Canadian
  Administrative Agent

  
	
   

  
	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
  Name:

  
	
   

  	
  Title:

  
					

 

S-7

 

	
   

  	
  U.S. BANK
  NATIONAL ASSOCIATION,

  
	
   

  	
  Senior
  Managing Agent and a Lender

  
	
   

  
	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
  Name:

  
	
   

  	
  Title:

  
					

 

S-8

 

	
   

  	
  WELLS FARGO
  BANK TEXAS, N.A.,

  
	
   

  	
  Senior
  Managing Agent and a Lender

  
	
   

  
	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
  Name:

  
	
   

  	
  Title:

  
					

 

S-9

 

	
   

  	
  CITICORP
  USA, INC., a Lender

  
	
   

  
	
   

  
	
   

  	
  By

  	
   

  	
   

  
	
   

  	
  Name:

  
	
   

  	
  Title:

  
					

 

S-10

 

	
   

  	
  SUNTRUST
  BANK, a Lender

  
	
   

  
	
   

  
	
   

  	
  By

  	
   

  	
   

  
	
   

  	
  Name:

  
	
   

  	
  Title:

  
					

 

S-11

 

	
   

  	
  SUMITOMO
  MITSUI BANKING

  CORPORATION, a Lender

  
	
   

  
	
   

  
	
   

  	
  By

  	
   

  	
   

  
	
   

  	
  Name:

  
	
   

  	
  Title:

  
					

 

S-12

 

	
   

  	
  UFJ BANK
  LTD., NEW YORK BRANCH,

  a Lender

  
	
   

  
	
   

  
	
   

  	
  By

  	
   

  	
   

  
	
   

  	
  Name:

  
	
   

  	
  Title:

  
					

 

S-13

 

	
   

  	
  COMERICA
  BANK,

  a Lender

  
	
   

  
	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
  Name:

  
	
   

  	
  Title:

  
	
   

  
	
   

  
	
   

  	
  COMERICA
  BANK, CANADA BRANCH

  a Canadian Lender

  
	
   

  
	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
  Name:

  
	
   

  	
  Title:

  
					

 

S-14

 

	
   

  	
  ROYAL BANK
  OF CANADA, a Lender

  
	
   

  
	
   

  
	
   

  	
  By

  	
   

  	
   

  
	
   

  	
  Name:

  
	
   

  	
  Title:

  
					

 

S-15

 

	
   

  	
  UNION BANK
  OF CALIFORNIA, N.A.,

  a Lender

  
	
   

  
	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
  Name:

  
	
   

  	
  Title:

  
	
   

  
	
   

  	
  UNION BANK
  OF CALIFORNIA, N.A.,

  CANADA BRANCH, a Lender

  
	
   

  
	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
  Name:

  
	
   

  	
  Title:

  
						

 

S-16

 

	
   

  	
  SOCIETE
  GENERALE, a Lender

  
	
   

  
	
   

  
	
   

  	
  By

  	
   

  	
   

  
	
   

  	
  Name:

  
	
   

  	
  Title:

  
					

 

S-17

 

	
   

  	
  SOUTHWEST
  BANK OF TEXAS, N.A.,

  a Lender

  
	
   

  
	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
  Name:

  
	
   

  	
  Title:

  
					

 

S-18

 

	
   

  	
  UBS LOAN
  FINANCE LLC, a Lender

  
	
   

  
	
   

  
	
   

  	
  By

  	
   

  	
   

  
	
   

  	
  Name:

  
	
   

  	
  Title:

  
	
   

  
	
   

  
	
   

  	
  UBS AG
  CANADA BRANCH, a Canadian Lender

  
	
   

  
	
   

  
	
   

  	
  By

  	
   

  	
   

  
	
   

  	
  Name:

  
	
   

  	
  Title:

  
					

 

S-19

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00061-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00061-of-00352.parquet"}]]