Document:

exv10w1

EXHIBIT 10.1

PCTEL SECURE LLC

a Delaware Limited Liability Company

AMENDED AND RESTATED

LIMITED LIABILITY COMPANY AGREEMENT

Dated as of January 5, 2011

THE MEMBERSHIP INTERESTS REPRESENTED BY THIS LIMITED LIABILITY COMPANY AGREEMENT HAVE NOT BEEN
REGISTERED UNDER THE UNITED STATES SECURITIES ACT OF 1933, AS AMENDED, OR UNDER ANY OTHER
APPLICABLE FEDERAL OR STATE SECURITIES LAWS. SUCH INTERESTS MAY NOT BE SOLD, ASSIGNED, PLEDGED OR
OTHERWISE DISPOSED OF AT ANY TIME WITHOUT EFFECTIVE REGISTRATION UNDER SUCH ACT AND LAWS OR
EXEMPTION THEREFROM, AND COMPLIANCE WITH THE OTHER RESTRICTIONS ON TRANSFER SET FORTH HEREIN.

 

			
	*	 	Confidential portions of this exhibit have been redacted and filed separately with the
Securities and Exchange Commission pursuant to a confidential treatment request in
accordance with Rule 24b-2 promulgated under the Securities Exchange Act of 1934, as amended.
Redacted portions are indicated with “[****].”

 

 

AMENDED AND RESTATED

LIMITED LIABILITY COMPANY AGREEMENT

OF

PCTEL SECURE LLC

A Delaware Limited Liability Company

          THIS AMENDED AND RESTATED LIMITED LIABILITY COMPANY AGREEMENT (the “Agreement”) of
PCTEL SECURE LLC (the “Company”), dated as of January 5, 2011 (the “Effective
Date”) is adopted, executed and entered into by and between PCTEL, Inc., a Delaware corporation
(“PCTEL”), and Eclipse Design Technologies, Inc., an Illinois corporation
(“Eclipse”). PCTEL and Eclipse are referred to in this Agreement as the “Members,”
and each individually, a “Member”). Anthony Vitucci is also a party to this Agreement
solely for the purposes of agreeing to the Restrictive Covenants set forth in Section 7.2.
This Agreement amends and restates in its entirety, and replaces, the Company’s Limited Liability
Company Agreement, dated as of October 20, 2010, entered into by PCTEL as the Company’s sole member
(the “Old Agreement”).

R E C I T A L S:

          A. The Members desire to form a joint venture in order to develop, manufacture, promote, sell
and otherwise exploit two primary products: (i) a secure smartphone on an Android®
platform combining the security of a military-grade communications device with the features and
functions of a commercial smartphone, and (ii) a card to be inserted in a smartphone to convert it
to a secure smartphone (together, the “Products”).

          B. On October 20, 2010 (the “Formation Date”), PCTEL formed the Company pursuant to
the Delaware Limited Liability Company Act, 6 Del. C. §18 101 et seq. (as amended from time to time
and including any successor statute of similar import, the “Act”) by the filing of the
Certificate with the Secretary of State of the State of Delaware in accordance with the Act.

          NOW, THEREFORE, in consideration of the mutual covenants and agreements herein made and
intending to be legally bound, the Members hereby agree as follows:

ARTICLE I

DEFINITIONS

     Section 1.1
Definitions

          As used in this Agreement, the following terms have the following meanings:

          “Act” has the meaning set forth in the recitals above.

          “Adjusted Capital Account Balance” shall mean, with respect to any Member, the amount
obtained by increasing the balance of such Member’s Capital Account by such Member’s

 

			
	*	 	Confidential portions of this exhibit have been redacted and filed separately with the
Securities and Exchange Commission pursuant to a confidential treatment request in
accordance with Rule 24b-2 promulgated under the Securities Exchange Act of 1934, as amended.
 Redacted portions are indicated with “[****].”

 

 

allocable share(s) of any Company Minimum Gain and Member Minimum Gain, both measured as of
the end of the relevant Taxable Year.

          “Adjusted Capital Account Deficit” shall mean, with respect to any Member, the deficit
balance, if any, in the Member’s Capital Account as of the end of the relevant Taxable Year, after
giving effect to the following adjustments:

     (a) the deficit shall be decreased by the amounts which the Member is obligated to
restore or is deemed obligated to restore pursuant to Regulation §§1.704-2(g)(1) and (i)(5);
and

     (b) the deficit shall be increased by the items described in Regulation
§§1.704-1(b)(2)(ii)(d)(4), (5) and (6).

The foregoing definition of Adjusted Capital Account Deficit is intended to comply with Regulations
§1.704-1(b)(2)(ii)(d) and shall be interpreted consistently therewith.

          “Affiliate” of any particular Person means any other Person that, directly or
indirectly, (i) owns or controls fifty percent (50%) or more of the outstanding voting or equity
interests of such Person or (ii) controls, is controlled by, or is under common control with, such
Person, where “control” means the possession, directly or indirectly, of the power to direct the
management and policies of a Person whether through the ownership of voting securities, by contract
or otherwise.

          “Agreement” has the meaning set forth in the introductory paragraph.

          “Annual Operating Budget” has the meaning set forth in Section 6.7.

          “Appointing Arbitrator” has the meaning set forth in Section 11.1(A).

          “Approved Sale” has the meaning set forth in Section 9.6(B).

          “Arbitrable Dispute” means any dispute, controversy, claim, or disagreements that may
arise between the Members or between any Member and the Company, in each case, in connection with
this Agreement or the transactions contemplated hereby; provided, however, in no event shall the
meaning of “Arbitrable Dispute” include (i) a Member’s election to give or withhold its consent to
any matter for which such Member’s consent is required or (ii) a Member’s decision to direct its
designee(s) to the Board to give or withhold his/her consent to any matter for which the approval
of the Board is required).

          “Arbitrator” has the meaning set forth in Section 11.1(A).

          “Board” has the meaning set forth in Section 6.1(A).

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	*	 	Confidential portions of this exhibit have been redacted and filed separately with the
Securities and Exchange Commission pursuant to a confidential treatment request in
accordance with Rule 24b-2 promulgated under the Securities Exchange Act of 1934, as amended.
 Redacted portions are indicated with “[****].”

 

          “Book Value” means, in respect of any property owned by the Company, the Company’s
adjusted basis for federal income tax purposes, adjusted from time to time to reflect the
adjustments required or permitted by Treasury Regulation Section 1.704-1(b)(2)(iv)(d)-(g) (provided
that, in the case of permitted adjustments, the Company shall only make such adjustments that it
reasonably determines are necessary or appropriate to reflect the relative economic interests of
the Members of the Company), provided that the initial Book Value of any asset contributed
to the Company shall be equal to the fair market value of the contributed asset on the date of
contribution.

          “Business Day” means any day, other than Saturday, Sunday or a day banks are
authorized or required to be closed in Chicago, Illinois.

          “Capital Account” has the meaning set forth in Section 4.1.

          “Capital Contribution” means the total amount of cash and the fair market value of any
other assets or services actually contributed (or deemed contributed under Regulation
§1.704-1(b)(2)(iv)(d)) to the Company by a Member, net of liabilities assumed or to which the
assets are subject.

          “Cause” means (i) the commission of a felony or a crime involving moral turpitude or
the commission of any other act or omission involving dishonesty or fraud in respect of the Company
or any of its customers or suppliers or in respect of its Members, (ii) conduct tending to bring
the Company or its Members into public disgrace or disrepute, (iii) material failure to comply with
the terms of this Agreement or to perform duties of the office held by such Person as reasonably
directed in writing by the Board, which failure is not cured (if curable) within five (5) days
after such Person receives written notice thereof from the Board or, if not reasonably curable
within such period, then within forty-five (45) days so long as such Person is diligently
attempting to cure and so long as such failure does not constitute an act or conduct falling within
clause (i) or (ii) above, or (iv) negligence or willful misconduct in respect of the Company.

          “Certificate” means the Certificate of Formation of the Company as filed with the
Secretary of State of the State of Delaware.

          “Claim” has the meaning set forth in Section 7.4.

          “Code” means the Internal Revenue Code of 1986 and any successor statute, as amended
from time to time(or any corresponding provision of succeeding law).

          “Company” has the meaning set forth in the introductory paragraph.

          “Company Minimum Gain” has the meaning set forth for “partnership minimum gain” in
Treasury Regulation Sections 1.704-2(b)(2) and 1.704-2(d).

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	*	 	Confidential portions of this exhibit have been redacted and filed separately with the
Securities and Exchange Commission pursuant to a confidential treatment request in
accordance with Rule 24b-2 promulgated under the Securities Exchange Act of 1934, as amended.
 Redacted portions are indicated with “[****].”

 

          “Confidential Information” means information that is not generally known to the public
and that is used, developed or obtained by the Company or any of its Affiliates in connection with
their respective businesses, including but not limited to (i) financial information and
projections, (ii) business strategies, (iii) products or services, (iv) fees, costs and pricing
structures, (v) designs, (vi) analysis, (vii) drawings, photographs and reports, (viii) computer
software, including operating systems, applications and program listings, (ix) flow charts, manuals
and documentation, (x) databases, (xi) accounting and business methods, (xii) inventions, devices,
new developments, methods and processes, whether patentable or unpatentable and whether or not
reduced to practice, (xiii) customers and clients and customer or client lists, (xiv) copyrightable
works, (xv) all technology and trade secrets, and (xvi) all similar and related information in
whatever form.

          “Contribution Agreement” means that certain Contribution Agreement dated January 5,
2011 by and among the Members effectuating, among other things, the Capital Contributions of the
Members.

          “Distribution” means a distribution made by the Company to a Member, whether in cash,
property or securities and whether by liquidating distribution or otherwise (including, without
limitation, distributions of Net Operating Cash Flow and Net Capital Proceeds); provided,
however, none of the following shall be a Distribution: (i) any redemption or repurchase by
the Company or any Member of any Membership Interests, (ii) any recapitalization or exchange of
securities of the Company, (iii) any subdivision or any combination of any outstanding Membership
Interests, or (iv) any reasonable fees or remuneration paid to any Member in such Member’s capacity
as an Officer, consultant or other provider of services to the Company.

          “Drag-Along Notice” has the meaning set forth in Section 9.6(B)(i).

          “Eclipse” has the meaning set forth in the introductory paragraph.

          “Eclipse Exit Period” has the meaning set forth in Section 9.5.

          “Eclipse Services Agreement” means (i) that certain Services Agreement dated as of
January 5, 2011 by and between Eclipse, as service provider, and the Company, as service recipient,
and (ii) the ancillary agreements and instruments contemplated thereby, all as amended or restated
from time to time.

          “Effective Date” has the meaning set forth in the introductory paragraph.

          “Enterprise Value” means the enterprise value of the Company as of any date of
determination calculated pursuant to the First Call Matrix (with respect to the First Call) or the
Second/Third Call Matrix (with respect to the Second Call or the Third Call); provided, however,
that solely for the purposes of calculating the Put Price, the Enterprise Value shall be deemed to
be $4,900,000.

4

 

			
	*	 	Confidential portions of this exhibit have been redacted and filed separately with the
Securities and Exchange Commission pursuant to a confidential treatment request in
accordance with Rule 24b-2 promulgated under the Securities Exchange Act of 1934, as amended.
 Redacted portions are indicated with “[****].”

 

          “Enterprise Value Notice” has the meaning set forth in Section 9.5.

          “Eric Üner January 2011 Bonus” has the meaning set forth in Section 5.8(B).

          “ERISA” has the meaning set forth in Section 3.1(C)(xii).

          “Failed Venture” means the occurrence of the following events: (a) PCTEL’s election
not to exercise, or failure to exercise, the Second Call within the Second Call Period, and
(b) the Enterprise Value of the Company as of the end of the Second Call Period being less than or
equal to $4,900,000.

          “Failed Venture Election” has the meaning set forth in Section 10.1(D).

          “First Call” means the purchase right exercisable by PCTEL pursuant to Section
9.2(A).

          “First Call Closing Date” has the meaning set forth in Section 9.2(A).

          “First Call Matrix” means the Enterprise Value calculation matrix appearing on
Exhibit B and pertaining to the First Call.

          “First Call Period” means the period commencing on January 1, 2012 through and
including March 31, 2012.

          “First Call Price” shall mean the price for Eclipse’s Membership Interests being
purchased in the First Call obtained by multiplying the Company’s Enterprise Value as set forth in
the First Call Matrix by the Percentage Interest represented by such Membership Interests.

          “Fiscal Year” means the twelve (12)-month period beginning on January 1st of a given
year and ending on December 31st of such year unless otherwise required by the Code. Each Fiscal
Year shall commence on the day immediately following the last day of the immediately preceding
Fiscal Year; provided, however, that the first Fiscal Year shall be deemed to have commenced on the
Formation Date.

          “Flow-Through Entity” has the meaning set forth in Section 3.1(C)(ix).

          “Formation Date” means the date set forth in the recitals above.

          “GAAP” has the meaning set forth in Section 6.7.

          “Governmental Body” means the federal government or any state, local or foreign
government or other political subdivision thereof and any entity exercising executive, legislative,
judicial, regulatory, or administrative functions of, or pertaining to, such a government.

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	*	 	Confidential portions of this exhibit have been redacted and filed separately with the
Securities and Exchange Commission pursuant to a confidential treatment request in
accordance with Rule 24b-2 promulgated under the Securities Exchange Act of 1934, as amended.
 Redacted portions are indicated with “[****].”

 

          “Indebtedness” means all indebtedness of a Person for borrowed money, whether secured
or unsecured, including, without limitation, (a) indebtedness of such a Person for the deferred
purchase price of property or services represented by a note, earnout or contingent purchase
payment, (b) all indebtedness of such Person created or arising under any conditional sale or other
title retention agreement with respect to property acquired by such Person, (c) all indebtedness of
such Person secured by a mortgage or other lien to secure all or part of the purchase price of the
property subject to such lien or mortgage, (d) all obligations under leases which are required to
be recorded as capital leases in respect of which such Person is liable as the lessee, (e) any
liability of such Person in respect of banker’s acceptances or letters of credit, (f) any
obligations under any interest rate swap agreements, (g) all interest, fees and other expenses owed
with respect to the indebtedness referred to above, (h) notes issued by a Person to reimburse any
landlord for or with respect to improvements to premises leased by such Person and (i) all
indebtedness referred to above which is directly or indirectly guaranteed by such Person.

          “Indemnifying Member” has the meaning set forth in Section 12.3.

          “Intellectual Property License Agreement” has the meaning set forth in Section
10.2(B)(iv).

          “Investment” as applied to any Person means (i) any direct or indirect purchase or
other acquisition by such Person of any notes, obligations, instruments, stock, securities or
ownership interest (including partnership interests, limited liability company interests and joint
venture interests) of any other Person and (ii) any capital contribution by such Person to any
other Person.

          “Investment Company Act” means the Investment Company Act of 1940, 15 U.S.C. §§80a-1
through 80a-52, as amended from time to time.

          “Marketing Period” has the meaning set forth in Section 9.5.

          “Material Contract” means any contract, agreement or understanding which involves, (a)
over the term of such contract, agreement or understanding, the expenditure of more than $10,000 or
(b) any federal, state, local, municipal or foreign governmental agency or any instrumentality
thereof as a party thereto.

          “Member” means each Person identified on Exhibit A attached hereto as of the
date hereof that has executed this Agreement, in each case so long as such Person is shown on the
Company’s books and records. The Members shall constitute the “members” (as that term is defined in
the Act) of the Company. Except as expressly provided herein, the Members shall constitute a single
class or group of members of the Company for all purposes of the Act and this Agreement.

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	*	 	Confidential portions of this exhibit have been redacted and filed separately with the
Securities and Exchange Commission pursuant to a confidential treatment request in
accordance with Rule 24b-2 promulgated under the Securities Exchange Act of 1934, as amended.
 Redacted portions are indicated with “[****].”

 

          “Member Minimum Gain” has the meaning set forth in Treasury Regulation Sections
1.704-2(i)(2) and 1.704-2(i)(3).

          “Member Nonrecourse Deductions” has the meaning set forth in Treasury Regulation
Sections 1.704-2(i).

          “Membership Interest” means a Member’s interest in the Company (including, without
limitation, capital and residual profits of the Company), and the right, if any, to participate in
the management of the business and affairs of the Company, including the right, if any, to vote on,
consent to, or otherwise participate in, any decision or action of or by the Members and the right
to receive information concerning the business and affairs of the Company, in each case to the
extent expressly provided in this Agreement or otherwise required by the Act.

          “Net Capital Proceeds” means the gross proceeds, if any, realized by the Company from
the sale, financing, refinancing or other disposition of the assets of the Company, net of the
actual costs and expenses incurred by the Company in connection with the transaction giving rise to
such proceeds, including repayment of any Indebtedness of the Company. Such amounts shall include
amounts received incident to the liquidation of the Company.

          “Net Indebtedness” means all Indebtedness of the Company (including without limitation
amounts borrowed pursuant to the PCTEL Line of Credit) net of Unrestricted Cash.

          “Net Operating Cash Flow” means, for any period (i) all cash revenues, interest and
other payments received by the Company during such period (excluding Capital Contributions and Net
Capital Proceeds) less (ii) all debt service payments and cash expenses paid by the Company during
such period, including all additions to reserves contemplated in the approved Annual Operating
Budget.

          “Net Proceeds” means, all cash proceeds and the fair market value (as determined by
PCTEL in good faith) of all non-cash proceeds of a Sale of the Company, calculated on a cash-free,
debt-free basis, net of all transaction expenses, including without limitation all legal,
investment banking, brokerage, accounting and related expenses.

          “OFAC” has the meaning set forth in Section 3.1(C)(xiii).

          “Offer Period” has the meaning set forth in Section 9.5.

          “Offer Price” has the meaning set forth in Section 9.5.

          “Officer” means each Person designated as an officer of the Company pursuant to
ARTICLE VI for so long as such Person remains an officer pursuant to the provisions of
ARTICLE VI.

          “Old Agreement” has the meaning set forth in the introductory paragraph.

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	*	 	Confidential portions of this exhibit have been redacted and filed separately with the
Securities and Exchange Commission pursuant to a confidential treatment request in
accordance with Rule 24b-2 promulgated under the Securities Exchange Act of 1934, as amended.
 Redacted portions are indicated with “[****].”

 

          “PCTEL” has the meaning set forth in the introductory paragraph.

          “PCTEL Line of Credit” means a revolving credit facility in the amount of $4,000,000
provided to the Company by PCTEL pursuant to the PCTEL Line of Credit Documents.

          “PCTEL Line of Credit Documents” means (i) that certain Line of Credit Agreement by
and between PCTEL, as lender, and the Company, as borrower, (ii) that certain Line of Credit Note
made by the Company and payable to the order of PCTEL, with a maximum principal balance of
$4,000,000 and (iii) the ancillary agreements and instruments contemplated thereby, all as amended
or restated from time to time.

          “PCTEL Services Agreement” means (i) that certain Services Agreement dated as of
January 5, 2011 by and between PCTEL, as service provider, and the Company, as service recipient,
and (ii) the ancillary agreements and instruments contemplated thereby, all as amended or restated
from time to time.

          “Percentage Interest” means, with respect to each Member, the percentage indicated
opposite such Member’s name on Exhibit A, as amended from time to time.

          “Person” means a natural person, partnership (whether general or limited), limited
liability company, trust, estate, association, corporation, custodian, nominee or any other
individual or entity in its own or any representative capacity.

          “Plan Asset Regulations” has the meaning set forth in Section 3.1(C)(xii).

          “Prime Rate” means the most recently announced prime rate in the Money Rates section
of the Wall Street Journal as in effect from time to time (or, if more than one rate is published,
the highest of such rates).

          “Proceeding” has the meaning set forth in Section 7.4.

          “Products” has the meaning set forth in the recitals above.

          “Profits” and “Losses” means, for each Taxable Year, an amount equal to the
Company’s taxable income or loss for such Taxable Year, determined in accordance with Code Section
703(a) (for this purpose, all items of income, gain, loss or deduction required to be stated
separately pursuant to Code Section 703(a)(1) shall be included in taxable income or loss), with
the following adjustments:

               (i) any item of the Company that is exempt from federal income tax shall be added to such
taxable income or loss;

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	*	 	Confidential portions of this exhibit have been redacted and filed separately with the
Securities and Exchange Commission pursuant to a confidential treatment request in
accordance with Rule 24b-2 promulgated under the Securities Exchange Act of 1934, as amended.
 Redacted portions are indicated with “[****].”

 

               (ii) any expenditures of the Company described in Code Section 705(a)(2)(B) or treated as Code
Section 705(a)(2)(B) expenditures pursuant to the regulations under Code Section 704(b) shall be
subtracted from such taxable income or loss;

               (iii) if the Book Value of any property owned by the Company is adjusted pursuant to Treasury
Regulation Section 1.704-1(b)(2)(iv)(e) or (f), the amount of such adjustment shall be taken into
account as gain or loss from the disposition of such property;

               (iv) gain or loss resulting from any disposition of property owned by the Company shall be
computed by reference to the Book Value of the property disposed of, notwithstanding that the
adjusted tax basis of such property differs from its Book Value;

               (v) items of depreciation, amortization and other cost recovery deductions in respect of
property owned by the Company having a Book Value that differs from its adjusted basis for tax
purposes shall be computed by reference to the property’s Book Value in accordance with Treasury
Regulation Section 1.704-1(b)(2)(iv)(g);

               (vi) to the extent an adjustment to the adjusted tax basis of any Company asset pursuant to
Code Sections 732(d), 734(b) or 743(b) is required, pursuant to Treasury Regulation Section
1.704-1(b)(2)(iv)(m), to be taken into account in determining Capital Accounts, the amount of such
adjustment to the Capital Accounts shall be treated as an item of gain (if the adjustment increases
the basis of the asset) or loss (if the adjustment decreases such basis) from the disposition of
the asset and shall be taken into account for purposes of computing Profits or Losses; and

               (vii) notwithstanding any other provision of this definition, any items which are allocated
pursuant to Section 5.6 or Section 5.8 shall not be taken into account in computing
Profits or Losses.

          “Put” means the sale right exercisable by Eclipse pursuant to Section 9.2(B).

          “Put Closing Date” has the meaning set forth in Section 9.2(B).

          “Put Notice” has the meaning set forth in Section 9.2(B).

          “Put Period” means the period commencing on April 1, 2012 through and including April
10, 2012.

          “Put Price” shall mean the price for Eclipse’s Membership Interests being sold
pursuant to the Put obtained by multiplying the Company’s Enterprise Value by the Percentage
Interest represented by such Membership Interests.

          “Qualifying Bank” means a bank or trust company that is (i) organized as a banking
association or corporation under the laws of the United States or any State thereof, or in the

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	*	 	Confidential portions of this exhibit have been redacted and filed separately with the
Securities and Exchange Commission pursuant to a confidential treatment request in
accordance with Rule 24b-2 promulgated under the Securities Exchange Act of 1934, as amended.
 Redacted portions are indicated with “[****].”

 

District of Columbia, (ii) subject to supervision or examination by federal, state or District
of Columbia banking authorities, (iii) with capital and surplus of not less than $250,000,000, and
(iv) the debt securities of which are rated at least “A” by Moody’s Investors Services, Inc. or
“A2” by Standard & Poor’s Ratings Group.

          “Qualifying Sale of the Company” means any Sale of the Company in which the Net
Proceeds received by PCTEL are greater than or equal to $40,000,000.

          “Restricted Member Affiliates” means Anthony Vitucci.

          “Restricted Period” means the period commencing as of the date of this Agreement and
ending on the earlier of (a) the dissolution of the Company in accordance with this Agreement and
(b) December 31, 2015.

          “Restrictive Covenants” has the meaning set forth in Section 7.2.

          “Sale of the Company” means any merger or consolidation of the Company with an
unaffiliated third party; any sale, lease, transfer or other conveyance of all or substantially all
of the Company’s assets to an unaffiliated third party; or any sale, lease, transfer or other
conveyance of any item of intellectual property, including any brand or trademark, which generated
seventy-five percent (75%) or more of the Company’s revenues for its then-current fiscal year or
for the fiscal year immediately prior thereto, with an unaffiliated third party; provided, however,
that any of the foregoing events, if effected in connection with a merger or consolidation of PCTEL
with an unaffiliated third party or the sale, lease, transfer or other conveyance of all or
substantially all of PCTEL’s assets to an unaffiliated third party shall not constitute a “Sale of
the Company.”

          “Second Call” means the purchase right exercisable by PCTEL pursuant to Section
9.3.

          “Second Call Closing Date” has the meaning set forth in Section 9.3.

          “Second Call Period” means the period commencing on October 1, 2013 through and
including December 31, 2013.

          “Second Call Price” shall mean the price for Eclipse’s Membership Interests obtained
by multiplying the Company’s Enterprise Value as set forth in the Second/Third Call Matrix by the
Percentage Interest represented by such Membership Interests.

          “Second/Third Call Matrix” means the Enterprise Value calculation matrix appearing on
Exhibit B and pertaining to the Second Call and the Third Call.

          “Securities Act” means the Securities Act of 1933, as amended from time to time.

10

 

			
	*	 	Confidential portions of this exhibit have been redacted and filed separately with the
Securities and Exchange Commission pursuant to a confidential treatment request in
accordance with Rule 24b-2 promulgated under the Securities Exchange Act of 1934, as amended.
 Redacted portions are indicated with “[****].”

 

          “Short-Term Investments” means U.S. Dollar-denominated, readily available instruments
consisting of one or more of:

               (i) interest bearing transaction accounts in a Qualifying Bank (including, without limitation,
money market accounts);

               (ii) time deposits, or certificates of deposit, in a Qualifying Bank, in each case having a
maturity of one year or less;

               (iii) securities that, at the date of investment, are direct obligations of, or obligations
fully guaranteed or insured by, the United States or any agency or instrumentality of the United
States having a maturity of not more than one year from the date of purchase;

               (iv) such other short-term, liquid investments having a maturity of three (3) months or less
rated at least “A” by Moody’s Investor’s Services, Inc. or “A2” by Standard & Poor’s Ratings Group;
and

               (v) money market mutual funds with assets of at least $500,000,000, substantially all of which
assets consist of obligations of the type included in clauses (i) through (iv) above.

          “Tag-Along Notice” has the meaning set forth in Section 9.6(B)(ii).

          “Taxable Year” means the Company’s taxable year ending on the last day of each
calendar year (or part thereof, in the case of the Company’s last taxable year), or such other year
as is (i) required by Section 706 of the Code or (ii) determined by the Board.

          “Tax Distribution” has the meaning set forth in Section 5.4.

          “Tax Matters Partner” has the meaning set forth in Section 8.2.

          “Third Call” means the purchase right exercisable by PCTEL pursuant to Section
9.6(A).

          “Third Call Closing Date” has the meaning set forth in Section 9.6(A).

          “Third Call Period” means July 1, 2014 and thereafter.

          “Third Call Price” shall be equal to the Second Call Price.

          “Third Party Sale Notice” has the meaning set forth in Section 9.5.

          “Third Party Purchaser” has the meaning set forth in Section 9.5.

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	*	 	Confidential portions of this exhibit have been redacted and filed separately with the
Securities and Exchange Commission pursuant to a confidential treatment request in
accordance with Rule 24b-2 promulgated under the Securities Exchange Act of 1934, as amended.
 Redacted portions are indicated with “[****].”

 

          “Transfer” means, with respect to each Member, any sale, assignment, conveyance,
transfer, exchange, distribution, gift, mortgage, pledge, hypothecation or other encumbrance or
disposal of all or any portion of such Member’s Membership Interest, whether voluntarily, by
operation of law, or otherwise.

          “Transferee” has the meaning set forth in Section 9.1.

          “Transferring Member” has the meaning set forth in Section 9.7(A)(i).

          “Treasury Regulations” means the Federal income tax regulations, including any
temporary or proposed regulations, promulgated under the Code, and any successor regulations
thereto.

          “Unrestricted Cash” means all unrestricted cash and cash equivalents of the Company.

          “U.S.” means all of the States of the United States of America and the District of
Columbia.

     Section 1.2 Incorporation of Recitals.

          The above-stated recitals are hereby incorporated herein and made a part of this Agreement.

     Section 1.3 Construction

          Whenever the context requires, the gender of all words used in this Agreement includes the
masculine, feminine and neuter and the singular number includes the plural number and vice versa.
All references to Articles and Sections refer to articles and sections of this Agreement, and all
references to Exhibits are to the Exhibits attached hereto, each of which is made a part hereof for
all purposes.

     Section 1.4 Including

          Reference in this Agreement to “including,” “includes” and “include” shall be deemed to be
followed by “without limitation.”

ARTICLE II

ORGANIZATION

     Section 2.1 Formation

          The Company has been organized as a Delaware limited liability company on the Formation Date
by the execution and filing of the Certificate under and pursuant to the Act and shall be continued
in accordance with the terms of this Agreement. The rights, powers, duties, obligations and
liabilities of the Members shall be determined pursuant to the Act and this

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	*	 	Confidential portions of this exhibit have been redacted and filed separately with the
Securities and Exchange Commission pursuant to a confidential treatment request in
accordance with Rule 24b-2 promulgated under the Securities Exchange Act of 1934, as amended.
 Redacted portions are indicated with “[****].”

 

Agreement. To the extent that the rights, powers, duties, obligations and liabilities of the
Members are different by any provision of this Agreement than they would be in the absence of such
provision, this Agreement shall, to the extent permitted by the Act, control.

     Section 2.2 Company Name

          The name of the Company shall be “PCTEL Secure LLC” and all Company business shall be
conducted in that name or such other names that comply with applicable law as the Board may select
from time to time. Notification of any change in the name of the Company shall be given to all
Members. The Company’s business may be conducted under its name and/or any other name or names
deemed advisable by the Board.

     Section 2.3 The Certificate, Etc.

          The Certificate was filed with the Secretary of State of the State of Delaware on the
Formation Date. The Members hereby agree to execute, file and record all such other certificates
and documents, including amendments to the Certificate and to do such other acts as may be
appropriate to comply with all requirements for the formation, continuation and operation of a
limited liability company, the ownership of property, and the conduct of business under the laws of
the State of Delaware and any other jurisdiction in which the Company may own property or conduct
business.

     Section 2.4 Term of the Company

          The term of the Company commenced on the Formation Date and shall continue in existence until
dissolution of the Company pursuant to Section 10.1.

     Section 2.5 Registered Office; Registered Agent; Principal Office; Other Offices

          The registered office of the Company required by the Act to be maintained in the State of
Delaware shall be the office of the initial registered agent named in the Certificate or such other
office (which need not be a place of business of the Company) as the Board may designate from time
to time in the manner provided by law. The registered agent of the Company in the State of Delaware
shall be the initial registered agent named in the Certificate or such other Person or Persons as
the Board may designate from time to time in the manner provided by law. The principal office of
the Company shall be at such place as the Board may designate from time to time, which need not be
in the State of Delaware, and the Company shall maintain records there. The Company may have such
other offices as the Board may designate from time to time.

     Section 2.6 Purposes

          The nature of the business or purposes to be conducted or promoted by the Company is to
acquire, develop, own, manage, exploit, license, sublicense and dispose of the Products. The
Company may engage in any and all activities necessary, desirable or incidental to the

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	*	 	Confidential portions of this exhibit have been redacted and filed separately with the
Securities and Exchange Commission pursuant to a confidential treatment request in
accordance with Rule 24b-2 promulgated under the Securities Exchange Act of 1934, as amended.
 Redacted portions are indicated with “[****].”

 

accomplishment of the foregoing. Notwithstanding anything herein to the contrary, nothing set
forth herein shall be construed as authorizing the Company to possess any purpose or power, or to
do any act or thing, forbidden by law to a limited liability company organized under the laws of
the State of Delaware.

     Section 2.7 Powers of the Company

          Subject to the provisions of this Agreement, the Company shall have the power and authority to
take any and all actions necessary or appropriate for the accomplishment of the purposes of the
Company set forth in Section 2.6, including, without limitation, the power, either directly
or through one or more subsidiaries or Affiliates:

               (A) to conduct its business, carry on its operations and have and exercise the powers granted
to a limited liability company by the Act in any state or district of the United States;

               (B) to acquire by purchase, lease, contribution of property or otherwise, rehabilitate, own,
hold, operate, maintain, finance, refinance, improve, lease, sell, convey, mortgage, transfer or
dispose of any real or personal property that may be necessary or appropriate for the
accomplishment of the purposes of the Company;

               (C) to enter into, perform and carry out contracts of any kind, including contracts with any
Member or any Affiliate thereof, or any agent of the Company necessary or appropriate for the
accomplishment of the purposes of the Company, including agreements for the management of the
affairs of the Company;

               (D) to purchase, take, receive, subscribe for or otherwise acquire, own, hold, vote, use,
employ, sell, mortgage, lend, pledge, or otherwise dispose of, and otherwise use and deal in and
with, shares or other interests in or obligations of domestic corporations, associations, general
or limited partnerships (including the power to be admitted as a partner thereof and to exercise
the rights and perform the duties created thereby), trusts, limited liability companies (including
the power to be admitted as a member or appointed as a manager thereof and to exercise the rights
and to perform the duties created thereby) or individuals or direct or indirect obligations of the
United States or any state, governmental district or municipality or of any instrumentality of any
of them;

               (E) to lend money for any proper purpose, to invest and reinvest its funds and to take and
hold real and personal property for the payment of funds so loaned or invested;

               (F) to sue and be sued, complain and defend, and participate in administrative or other
proceedings, in its name;

               (G) to appoint agents of the Company and define their duties and fix their compensation;

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	*	 	Confidential portions of this exhibit have been redacted and filed separately with the
Securities and Exchange Commission pursuant to a confidential treatment request in
accordance with Rule 24b-2 promulgated under the Securities Exchange Act of 1934, as amended.
 Redacted portions are indicated with “[****].”

 

               (H) to indemnify any Person in accordance with the Act (subject to Section 7.4) and to
obtain any and all types of insurance;

               (I) to cease its activities and cancel its Certificate;

               (J) to negotiate, enter into, renegotiate, extend, renew, terminate, modify, amend, waive,
execute, acknowledge or take any other action in respect of any lease, contract or security
agreement in respect of any assets of the Company;

               (K) to borrow money and issue evidences of indebtedness and guaranty indebtedness and to
secure the same by a mortgage, pledge or other lien on the assets of the Company;

               (L) to pay, collect, compromise, litigate, arbitrate or otherwise adjust or settle any and all
other claims or demands of or against the Company or to hold such proceeds against the payment of
contingent liabilities; and

               (M) to make, execute, acknowledge and file any and all documents or instruments necessary or
appropriate for the accomplishment of the purposes of the Company.

     Section 2.8 Board Authority

          Subject to the provisions of this Agreement, and in furtherance of the purposes of the Company
as set forth in Section 2.6, (i) the Company may, upon the direction of the Board, enter
into and perform any and all documents, agreements and instruments contemplated thereby, all
without any further act, vote or approval of any Member, and (ii) the Board may authorize any
Person (including any Member or Officer) to enter into and perform any and all documents,
agreements and instruments on behalf of the Company. Each Person so authorized by the Board,
whether pursuant to this Agreement or subsequent action of the Board, shall be deemed a “manager”
for purposes of the Act.

     Section 2.9 Foreign Qualification

          Prior to the Company’s conducting business in any jurisdiction other than Delaware, the Board
shall cause the Company to comply with all requirements necessary to qualify the Company as a
foreign limited liability company in that jurisdiction. At the request of the Board or any Officer,
each Member shall execute, acknowledge, swear to and deliver any or all certificates and other
instruments conforming with this Agreement that are necessary or appropriate to qualify, continue
and terminate the Company as a foreign limited liability company in all such jurisdictions in which
the Company may conduct business.

     Section 2.10 No State-Law Partnership

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	*	 	Confidential portions of this exhibit have been redacted and filed separately with the
Securities and Exchange Commission pursuant to a confidential treatment request in
accordance with Rule 24b-2 promulgated under the Securities Exchange Act of 1934, as amended.
 Redacted portions are indicated with “[****].”

 

          The Members intend that the Company shall not be a partnership (including a general or limited
partnership) or a contractual joint venture, and that no Member shall be a partner or a contractual
joint venturer of any other Member by virtue of this Agreement, for any purposes other than federal
and, if applicable, state tax purposes, and neither this Agreement nor any other document entered
into by the Company or any Member shall be construed to suggest otherwise. The Members intend that
the Company shall be treated as a partnership for federal and, if applicable, state income tax
purposes, and each Member and the Company shall file all tax returns and shall otherwise take all
tax and financial reporting positions in a manner consistent with such treatment.

ARTICLE III

MEMBERSHIP; CONTRIBUTIONS

     Section 3.1 Members

               (A) Names, etc. The names, residence, business or mailing addresses and Capital
Contributions of each Member are set forth on Exhibit A. Any reference in this Agreement to
Exhibit A shall be deemed to be a reference to Exhibit A as amended and in effect
from time to time in accordance with the terms of this Agreement. Each Person listed on Exhibit
A shall, upon its execution of this Agreement or counterpart thereto, be admitted to the
Company as a Member of the Company.

               (B) Loans by Members. No Member, as such, shall be required to lend any funds to the
Company or to make any contribution of capital to the Company, except as otherwise required by
applicable law, this Agreement, or any other written agreement between such Member and the Company
explicitly requiring the making of capital contributions, including without limitation the PCTEL
Line of Credit Documents. Any Member may, with the approval of the Board, make loans to the
Company on terms agreed upon by the Board and such Member, including without limitation pursuant to
the PCTEL Line of Credit Documents, and any loan by a Member to the Company shall not be considered
to be a Capital Contribution.

               (C) Representations and Warranties of Members. Each Member hereby represents and
warrants and acknowledges that:

                    (i) such Member has knowledge and experience in financial and business matters and is capable
of evaluating the merits and risks of an investment in the Company and making an informed
investment decision with respect thereto;

                    (ii) such Member has reviewed and evaluated all information necessary to assess the merits and
risks of its investment in the Company and has had answered to its satisfaction any and all
questions regarding such information;

                    (iii) such Member is able to bear the economic and financial risk of an investment in the
Company for an indefinite period of time;

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	*	 	Confidential portions of this exhibit have been redacted and filed separately with the
Securities and Exchange Commission pursuant to a confidential treatment request in
accordance with Rule 24b-2 promulgated under the Securities Exchange Act of 1934, as amended.
 Redacted portions are indicated with “[****].”

 

                    (iv) such Member is acquiring its interest in the Company for investment only and not with a
view to, or for resale in connection with, any distribution to the public or public offering
thereof;

                    (v) the interests in the capital and residual profits of the Company have not been registered
under the securities laws of any jurisdiction and cannot be disposed of unless they are
subsequently registered and/or qualified under applicable securities laws and the provisions of
this Agreement have been complied with;

                    (vi) the execution, delivery and performance of this Agreement have been duly authorized by
such Member and do not require such Member to obtain any consent or approval that has not been
obtained and do not contravene or result in a default under any provision of any law or regulation
applicable to such Member or other governing documents or any agreement or instrument to which such
Member is a party or by which such Member is bound, and the Person executing this Agreement on
behalf of such Member has been duly authorized to do so;

                    (vii) the determination of such Member to invest in the Company has been made by such Member
independent of any other Member and independent of any statements or opinions as to the
advisability of such purchase or as to the properties, business, prospects or condition (financial
or otherwise) of the Company and its subsidiaries which may have been made or given by any other
Member or by any Affiliate or agent of any other Member;

                    (viii) this Agreement is valid, binding and enforceable against such Member in accordance with
its terms, and, such Member is not a party to any other written or verbal agreement or
understanding with respect to the subject matter of this Agreement, with the exception only of the
Contribution Agreement, the Eclipse Service Agreement and the PCTEL Service Agreement, if such
Member is a party thereto;

                    (ix) if a Member is a partnership, limited liability company or other entity classified as a
partnership for federal income tax purposes, or a grantor trust (within the meaning of Sections
671-679 of the Code) or an S corporation (within the meaning of Section 1361 of the Code) (each, a
“Flow-Through Entity”), either: (a) no Person will own, directly or indirectly through one
or more flow-through entities, an interest in such Member where more than seventy percent (70%) of
the value of the Person’s interest in such Member is attributable to such Member’s investment in
the Company; or (b) if one or more Persons will own, directly or indirectly through one or more
Flow-Through Entities, an interest in such Member where more than seventy percent (70%) of the
value of the Person’s interest in such Member is attributable to the Member’s investment in the
Company, neither the Member nor any such Person has or will have any intent or purpose of having
such Person invest in the Company indirectly through the Member in order to enable the Company to
satisfy the 100-Member limitation in Treas. Reg. §1.7704-1(h) (the private placement safe harbor
from publicly traded status);

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	*	 	Confidential portions of this exhibit have been redacted and filed separately with the
Securities and Exchange Commission pursuant to a confidential treatment request in
accordance with Rule 24b-2 promulgated under the Securities Exchange Act of 1934, as amended.
 Redacted portions are indicated with “[****].”

 

                    (x) unless such Member has notified the Board to the contrary, such Member: (a) is a “United
States Person” within the meaning of Section 7701 of the Code (i.e., is not any of the following
(as defined in the Code): a nonresident alien individual, foreign partnership, foreign corporation,
foreign estate, foreign trust, other foreign entity or organization, or grantor trust having a
foreign person as an owner); (b) is a “U.S. Person” within the meaning of Section 120.15 of the
International Traffic in Arms Regulation (ITAR), 22 CFR Chapter I, Subchapter M, Parts 120-130; (c)
shall notify the Company within sixty (60) days of the date such Member ceases to be a “United
States Person” or a “U.S. Person,” as so defined; and (d) may be asked to recertify its non-foreign
status at periodic intervals (and that this information may be disclosed to the Internal Revenue
Service);

                    (xi) if such Member will beneficially own ten percent (10%) or more of the Membership
Interests in the Company, the Member is not an “investment company” as defined in the Investment
Company Act nor is the Member relying on Section 3(c)(1) or Section 3(c)(7) of the Investment
Company Act as an exemption from classification as an “investment company”;

                    (xii) such Member is not holding and, for the term of the Company, will not hold “plan
assets,” as that term is defined in the Employee Retirement Income Security Act of 1974, as amended
(“ERISA”), or the rules and regulations promulgated thereunder, including, without
limitation, the Department of Labor Regulations Section 2510.3-101 (the “Plan Asset
Regulations”), and, consequently, the administration and management of the Company and the
investment of the Company’s assets are not, and will not be, subject to the fiduciary duty
requirements of ERISA; and

                    (xiii) such Member (nor any Person owning an interest in such Member) is not (nor will be) a
Person with whom the Company or any other Member is restricted from doing business under
regulations of the Office of Foreign Assets Control (“OFAC”) of the Department of the
Treasury of the United States of America (including, those persons named on OFAC’s Specially
Designated Nationals and Blocked Persons list) or under any statute, executive order (including the
September 24, 2001 Executive Order Blocking Property and Prohibiting Transactions With Persons Who
Commit, Threaten to Commit, or Support Terrorism), or other governmental action and such Member is
not engaging in, and shall not knowingly engage in, any dealings or transactions with such Persons.

               (D) Additional Representations and Warranties of PCTEL. PCTEL hereby represents and
warrants that, at all times during the period commencing with the Formation Date and ending on the
Effective Date, PCTEL (i) has been the sole member of the Company and (ii) has not caused the
Company to engage in any activities with the exception of (a) obtaining a tax identification
number, (b) establishing a bank account, and (c) related organizational tasks. All such activities
have been conducted in accordance with the terms of the Old Agreement.

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	*	 	Confidential portions of this exhibit have been redacted and filed separately with the
Securities and Exchange Commission pursuant to a confidential treatment request in
accordance with Rule 24b-2 promulgated under the Securities Exchange Act of 1934, as amended.
 Redacted portions are indicated with “[****].”

 

     Section 3.2 No Liability of Members

               (A) No Liability. Except as otherwise required by applicable law, no Member shall have
any personal liability whatsoever in such Member’s capacity as a Member, whether to the Company, to
any of the other Members, to the creditors of the Company or to any other third party, for the
debts, liabilities, commitments or any other obligations of the Company or for any losses of the
Company. Each Member shall be liable only to make such Member’s Capital Contributions to the
Company pursuant to the terms and conditions provided expressly herein.

               (B) Distributions. In accordance with the Act and the laws of the State of Delaware, a
member of a limited liability company may, under certain circumstances, be required to return
amounts previously distributed to such member. It is the intent of the Members that no Distribution
to any Member pursuant to ARTICLE V shall be deemed a return of money or other property
paid or distributed in violation of the Act. The payment of any such money or distribution of any
such property to a Member shall be deemed to be a compromise within the meaning of the Act, and the
Member receiving any such money or property shall not be required to return to any Person any such
money or property. However, if any court of competent jurisdiction holds that, notwithstanding the
provisions of this Agreement, any Member is obligated to make any such payment, such obligation
shall be the obligation of such Member and not of any other Member.

     Section 3.3 Capital Contributions

               (A) Generally. Each Member, by execution of this Agreement, agrees to make Capital
Contributions in accordance with the terms of this Agreement.

               (B) Initial Capital Contributions. Concurrently with the execution and delivery of
this Agreement, each of the Members shall contribute (or cause to be contributed) to the Company
the Capital Contributions as set forth on Exhibit A, subject to the terms thereof and the
terms of the Contribution Agreement, and each of the Members’ Capital Accounts shall be credited
with an amount equal to the value thereof, as set forth therein.

               (C) Additional Capital Contributions. The Members shall not be required to make any
additional Capital Contributions to the Company.

     Section 3.4 Certification of Membership Interests

          The Company may in its discretion issue certificates to the Members representing the interest
in the capital and residual profits held by such Member.

     Section 3.5 Other Activities

          Subject to the other express provisions of this Agreement and any other agreements with the
Company, including, without limitation, any leases, services agreements, employment

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	*	 	Confidential portions of this exhibit have been redacted and filed separately with the
Securities and Exchange Commission pursuant to a confidential treatment request in
accordance with Rule 24b-2 promulgated under the Securities Exchange Act of 1934, as amended.
 Redacted portions are indicated with “[****].”

 

agreements, independent contractor agreements to which a Member or Affiliate of a Member may
be a party, each Member, member of the Board or Officer of the Company, at any time and from time
to time, may engage in and own interests in other business ventures of any type and description,
independently or with others. In this regard, each party recognizes that (i) PCTEL and its
Affiliates are in the business of propagation and optimization solutions for the wireless industry,
design and development of software-based radios for wireless network optimization and development
and distribution of antenna solutions, and have interests therein for profit and may engage in all
activities related or incidental thereto and (ii) Eclipse and its Affiliates are in the business of
RF, analog, mixed-signal and digital integrated circuit design, signal processing circuit
implementation and embedded software development and have interests therein for profit and may
engage in all activities related or incidental thereto. None of the Company, any other Member, or
any Affiliate of any other Member shall have any right by virtue of this Agreement or the company
relationship created hereby in or to any ventures or activities of PCTEL, Eclipse or their
respective Affiliates or to the income or proceeds derived therefrom or the pursuit of such other
ventures or opportunities by PCTEL, Eclipse or their respective Affiliates. Except as set forth in
this Agreement, none of PCTEL, Eclipse or their respective Affiliates shall be obligated to present
or disclose to the Company or any Member any particular investment opportunity and PCTEL, Eclipse
or their respective Affiliates shall have the right to take for their own account any particular
investment opportunity; provided, however, that during the term of this Agreement and the
Restricted Period no Member shall be involved in any capacity in any investment opportunity that is
competitive with the purposes set forth in Section 2.6. Except as set forth in this
Agreement, the involvement by a Member or its Affiliates in an investment opportunity shall not
constitute a conflict of interest by such Person with respect to the Company, any of the Members,
or any of their respective Affiliates.

ARTICLE IV

CAPITAL ACCOUNTS

     Section 4.1 Establishment and Determination of Capital Accounts

          A capital account (“Capital Account”) shall be established for each Member on the
books of the Company. Each Member’s Capital Account shall be (i) increased by any Capital
Contributions made by such Member pursuant to the terms of this Agreement and such Member’s share
of Profits and any other items of income and gain allocated to such Member pursuant to ARTICLE
V (other than Section 5.8), (ii) decreased by such Member’s share of Losses, the amount
of cash or the fair market value of any other property (net of liabilities assumed by such Member
and liabilities to which such property is subject) distributed to such Member, and any other item
of loss or deduction allocated to such Member pursuant to ARTICLE V, and (iii) adjusted as
otherwise required by the Code and the regulations thereunder, including but not limited to, the
rules of Treasury Regulation Section 1.704-1(b)(2)(iv). Any references in this Agreement to the
Capital Account of a Member shall be deemed to refer to such Capital Account as the same may be
increased or decreased from time to time as set forth above.

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	*	 	Confidential portions of this exhibit have been redacted and filed separately with the
Securities and Exchange Commission pursuant to a confidential treatment request in
accordance with Rule 24b-2 promulgated under the Securities Exchange Act of 1934, as amended.
 Redacted portions are indicated with “[****].”

 

     Section 4.2 Negative Capital Accounts

          Except as expressly provided herein, or as required by applicable law, no Member shall be
required to pay to the Company or any other Member any deficit or negative balance which may exist
from time to time in such Member’s Capital Account.

     Section 4.3 Company Capital

          No Member shall be paid interest on any Capital Contribution to the Company or on such
Member’s Capital Account, and no Member shall have any right (i) to demand the return of such
Member’s Capital Contribution or any other distribution from the Company (whether upon resignation,
withdrawal or otherwise), except upon dissolution of the Company pursuant to ARTICLE X, or
(ii) to cause a partition of the Company’s assets.

     Section 4.4 Compliance With Section 1.704-1(b)

          The provisions of this Agreement relating to the maintenance of Capital Accounts are intended
to comply with Section 1.704-1(b) of the Treasury Regulations, and shall be interpreted and applied
in a manner consistent with such Treasury Regulations. In the event the Board shall determine that
it is prudent to modify the manner in which the Capital Accounts, or any debits or credits thereto
(including, without limitation, debits or credits relating to liabilities which are secured by
contributed or distributed property or which are assumed by the Company or any Member), are
computed in order to comply with such regulation, the Board may make such modification; provided
that it is not likely to have a material effect on the amounts distributable to any Member pursuant
to ARTICLE X upon the dissolution of the Company. The Board also shall (i) make any
adjustments that are necessary or appropriate to maintain equality between the Capital Accounts of
the Members and the amount of Company capital reflected on the Company’s balance sheet, as computed
for book purposes, in accordance with Treas. Reg. §1.704-1(b)(iv)(g), and (ii) make any appropriate
modifications in the event unanticipated events might otherwise cause this Agreement not to comply
with Treas. Reg. §1.704-1(b); provided that adjustments and/or modification is not likely to have a
material effect on the amounts distributable to any Member pursuant to ARTICLE X upon the
dissolution of the Company.

     Section 4.5 Transfer of Capital Accounts

          The original Capital Account established for each substituted Member shall be in the same
amount as the Capital Account of the Member which such substituted Member succeeds, at the time
such substituted Member is admitted to the Company. The Capital Account of any Member whose
interest in the Company shall be increased or decreased by means of the transfer to it of all or
part of the Membership Interest of another Member shall be appropriately adjusted to reflect such
transfer. Any reference in this Agreement to a Capital Contribution of or distribution to a Member
that has succeeded any other Member shall include any Capital Contributions or distributions
previously made by or to the former Member on account of the Membership Interest of such former
Member transferred to such Member.

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	*	 	Confidential portions of this exhibit have been redacted and filed separately with the
Securities and Exchange Commission pursuant to a confidential treatment request in
accordance with Rule 24b-2 promulgated under the Securities Exchange Act of 1934, as amended.
 Redacted portions are indicated with “[****].”

 

ARTICLE V

DISTRIBUTIONS; ALLOCATIONS OF PROFITS AND LOSSES

     Section 5.1 Generally

          Subject to the provisions of Section 18-607 of the Act and to the provisions of this
ARTICLE V, the Board shall make Distributions of Net Operating Cash Flow and Net Capital
Proceeds to its Members as and when determined by the Board from time to time and subject to the
retention and establishment of or reserves of, or payment to third parties of, such funds as it
deems necessary in respect of the reasonable business needs of the Company which shall include the
payment or the making of provision for the payment when due of the Company’s obligations, including
without limitation the Company’s obligations under the PCTEL Line of Credit Documents.

     Section 5.2 Net Operating Cash Flow Distributions

          Subject to Section 5.1, all Distributions of Net Operating Cash Flow shall be made to
the Members in proportion to their respective Percentage Interests as of the date such
Distributions are made.

     Section 5.3 Net Capital Proceeds Distributions

          Subject to Section 5.1, all Distributions of Net Capital Proceeds shall be made to the
Members in proportion to their respective Percentage Interests as of the date such Distributions
are made.

     Section 5.4 Tax Distributions

          Notwithstanding Section 5.2 or Section 5.3, or any other provision of this
Agreement, the Board shall, to the maximum extent permitted by applicable law and to the extent
that distributable cash is reasonably available to the Company, cause the Company to distribute to
each Member an amount equal to such Member’s “Tax Distribution” (as defined below). With respect
to a taxable year, distributions made pursuant to Section 5.2 or Section 5.3 shall
discharge the Company’s obligations under this Section 5.4, and distributions made under
this Section 5.4 shall reduce amounts distributable pursuant to Section 5.2 or
Section 5.3, as applicable. For purposes of this Agreement, “Tax Distribution”
means, with respect to a taxable year of the Company, an amount equal to the net taxable income
reported (or that is reasonably anticipated will be reported) on the Schedule K-1 issued (or that
will be issued) by the Company to such Member for such taxable year (less any net tax losses on
Schedule K-1 for prior taxable years to the extent not previously considered pursuant to this
Section 5.4) multiplied by forty percent (40%). Any and all Tax Distributions shall be
made on a quarterly basis.

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	*	 	Confidential portions of this exhibit have been redacted and filed separately with the
Securities and Exchange Commission pursuant to a confidential treatment request in
accordance with Rule 24b-2 promulgated under the Securities Exchange Act of 1934, as amended.
 Redacted portions are indicated with “[****].”

 

     Section 5.5 Allocation of Profits and Losses

               (A) Profits. After giving effect to the special allocations set forth in Section
5.6, Profits for any Taxable Year shall be allocated in the following order and priority:

                    (i) First, to the Members in an amount equal to the excess, if any, of (x) the cumulative
Losses allocated to each such Member pursuant to Section 5.5(B) for all prior Taxable
Years, over (y) the cumulative Profits allocated to each such Member pursuant to this Section
5.5(A)(i) for all prior Taxable Years (and between the Members based on the relative share of
the aggregate net Loss previously allocated to each);

                    (ii) Thereafter, to the Members in proportion to their Percentage Interests.

               (B) Losses. After giving effect to the special allocations set forth in Section
5.6, Losses for any Taxable Year shall be allocated as set forth in Section 5.5(B)(i),
subject to the limitations in Section 5.5(B)(ii).

                    (i) Losses for any Taxable Year shall be allocated to the Members in proportion to their
Percentage Interests to the extent permitted by Section 5.5(B)(ii). In the event that
Section 5.5(B)(ii) prevents an allocation of Losses to one or more of the Members (but less
than all of the Members), the remaining Loss shall be allocated between the remaining Members in
proportion to their Percentage Interests.

                    (ii) The Losses allocated pursuant to Section 5.5(B)(i) shall not exceed the maximum
amount of Losses that can be so allocated without causing any Member to have an Adjusted Capital
Account Deficit at the end of any Taxable Year. In the event some but not all of the Members would
have Adjusted Capital Account Deficits as a consequence of an allocation of Losses pursuant to
Section 5.5(B)(i), the limitation set forth in this Section 5.5(B)(ii) shall be
applied on a Member by Member basis so as to allocate the maximum permissible Losses to each Member
under Regulations Section 1.704-1(b)(2)(ii)(d).

     Section 5.6 Regulatory and Special Allocations

          Notwithstanding the provisions of Section 5.5:

               (A) Company Minimum Gain Chargeback. Except as otherwise provided in Treasury
Regulation Section 1.704-2(f), if there is a net decrease in Company Minimum Gain during any
Taxable Year, each Member shall be specially allocated items of taxable income or gain for such
Taxable Year (and, if necessary, subsequent Taxable Years) in an amount equal to such Member’s
share of the net decrease in Company Minimum Gain, determined in accordance with Treasury
Regulation Section 1.704-2(g). The items to be so allocated shall be determined in accordance with
Treasury Regulation Sections 1.704-2(f)(6) and 1.704-2(j)(2). This Section

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	*	 	Confidential portions of this exhibit have been redacted and filed separately with the
Securities and Exchange Commission pursuant to a confidential treatment request in
accordance with Rule 24b-2 promulgated under the Securities Exchange Act of 1934, as amended.
 Redacted portions are indicated with “[****].”

 

5.6(A) is intended to comply with the minimum gain chargeback requirement in Treasury
Regulation Section 1.704-2(f) and shall be interpreted consistently therewith.

               (B) Member Nonrecourse Debt Minimum Gain Chargeback. Except as otherwise provided in
Treasury Regulation Section 1.704-2(i)(4), if there is a net decrease in Member Minimum Gain
attributable to a “Member Nonrecourse Debt” (as those terms are defined in Treasury Regulation
Section 1.704-2(b)(4)) during any Taxable Year, each Member that has a share of such Member Minimum
Gain shall be specially allocated items of taxable income or gain for such Taxable Year (and, if
necessary, subsequent Taxable Years) in an amount equal to that Member’s share of the net decrease
in Member Minimum Gain. Items to be allocated pursuant to this paragraph shall be determined in
accordance with Treasury Regulation Sections 1.704-2(i)(4) and 1.704-2(j)(2). This Section
5.6(B) is intended to comply with the minimum gain chargeback requirements in Treasury
Regulation Section 1.704-2(i)(4) and shall be interpreted consistently therewith.

               (C) Qualified Income Offset. If any Member unexpectedly receives any adjustments,
allocations or distributions described in Treasury Regulation Section 1.704-1(b)(2)(ii)(d)(4), (5)
or (6), items of taxable income and gain shall be specially allocated to such Member in an amount
and manner sufficient to eliminate the adjusted capital account deficit (determined according to
Treasury Regulation Section 1.704-1(b)(2)(ii)(d)) created by such adjustments, allocations or
distributions as quickly as possible, provided that an allocation pursuant to this
Section 5.6(C) shall be made only if and to the extent that such Member would have a
Adjusted Capital Account Deficit after all other allocations provided for in this ARTICLE V
have been tentatively made as if this Section 5.6(C) were not in the Agreement. This
Section 5.6(C) is intended to comply with the qualified income offset requirement in
Treasury Regulation Section 1.704-1(b)(2)(ii)(d) and shall be interpreted consistently therewith.

               (D) Gross Income Allocation. In the event any Member has a deficit Capital Account at
the end of any Taxable Year that is in excess of the sum of (i) the amount the Member is obligated
to restore pursuant to any provision of this Agreement and (ii) the amount the Member is deemed to
be obligated to restore pursuant to the penultimate sentences of the Treasury Regulations
1.704-2(g)(1) and 1.704-2(i)(5), the Member shall be specially allocated items of Company income
and gain in the amount of such excess as quickly as possible, provided that an allocation
pursuant to this Section 5.6(D) shall be made only if and to the extent that such Member
would have a deficit Capital Account in excess of such sum after all other allocations provided for
in this ARTICLE V have been tentatively made as if Section 5.6(C) and this
Section 5.6(D) were not in this Agreement.

               (E) Nonrecourse Deductions. Nonrecourse Deductions (as determined according to
Treasury Regulation Section 1.704-2(b)(1)) for any Taxable Year shall be allocated to the Members
in accordance with their respective Percentage Interests, and Member Nonrecourse Deductions shall
be allocated in the manner required by Treasury Regulation Section 1.704-2(i).

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	*	 	Confidential portions of this exhibit have been redacted and filed separately with the
Securities and Exchange Commission pursuant to a confidential treatment request in
accordance with Rule 24b-2 promulgated under the Securities Exchange Act of 1934, as amended.
 Redacted portions are indicated with “[****].”

 

               (F) Member Nonrecourse Deductions. Any Member Nonrecourse Deductions for any Taxable
Year shall be specially allocated to the Member who bears the economic risk of loss with respect to
the Member Nonrecourse Debt to which such Member Nonrecourse Deductions are attributable in
accordance with Treasury Regulation §1.704-2(i)(1).

               (G) Section 754 Adjustment. To the extent an adjustment to the adjusted tax basis of
any Company asset pursuant to Code §§734(b) or 743(b) is required, pursuant to Treasury Regulation
§§1.704-1(b)(2)(iv)(m)(2) or 1.704-1(b)(2)(iv)(m)(4), to be taken
into account in determining Capital Accounts as the result of a distribution to a Member in
complete liquidation of his interest in the Company, the amount of such adjustment to the Capital
Accounts shall be treated as an item of gain (if the adjustment increases the basis of the asset)
or loss (if the adjustment decreases such basis) and such gain or loss shall be specially allocated
to the Members in accordance with their interests in the Company in the event that Treasury
Regulation §1.704-1(b)(2)(iv)(m)(2) applies, or to the Members to whom such
distribution was made in the event that Treasury Regulation
§1.704-1(b)(2)(iv)(m)(4) applies.

               (H) Curative Allocations. The allocations set forth in Section 5.5(B)(ii),
and Section 5.6(A), (B), (C), (D), (E), (F), and (G) (the “Regulatory Allocations”) are
intended to comply with certain requirements of the Treasury Regulations. It is the intent of the
Members that, to the extent possible, all Regulatory Allocations shall be offset either with other
Regulatory Allocations or with special allocations of other items of Company income, gain, loss, or
deduction pursuant to this Section 5.6(H). Therefore, notwithstanding any other provision
of this ARTICLE V (other than the Regulatory Allocations), the Board of Managers shall make
such offsetting special allocations of Company income, gain, loss, or deduction in whatever manner
it determines appropriate so that, after such offsetting allocations are made, each Member’s
Capital Account balance is, to the extent possible, equal to the Capital Account balance such
Member would have had if the Regulatory Allocations were not part of the Agreement and all Company
items were allocated pursuant to Section 5.5(A), Section 5.5(B)(i), and Section
5.8. In exercising its discretion under this Section 5.6(H), the Board of Managers
shall take into account future Regulatory Allocations under Section 5.6(A) and (B)
that, although not yet made, are likely to offset other Regulatory Allocations previously made
under Section 5.6(E) and (F).

               (I) Offsetting Allocations. If, and to the extent that, any Member is deemed to
recognize any item of income, gain, deduction or loss as a result of any transaction between such
Member and the Company pursuant to Sections 1272-1274, 7872, 483, 482 or 83 of the Code or any
similar provision now or hereafter in effect, and the Board reasonably determines that any
corresponding item of deduction, loss, income or gain recognized by the Company (net of any income
or deduction recognized by the Company in connection with such transaction) should be allocated to
such Member in order to reflect the Members’ Percentage Interest in the Company, then the Board may
so allocate such corresponding net item.

     Section 5.7 Section 754 Election

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	*	 	Confidential portions of this exhibit have been redacted and filed separately with the
Securities and Exchange Commission pursuant to a confidential treatment request in
accordance with Rule 24b-2 promulgated under the Securities Exchange Act of 1934, as amended.
 Redacted portions are indicated with “[****].”

 

          Upon the request of any Member, the Company shall elect, pursuant to Section 754 of the Code,
to adjust the basis of property owned by the Company as permitted and provided in Sections 734 and
743 of the Code. Such election shall be effective solely for Federal (and, if applicable, state and
local) income tax purposes and shall not result in any adjustment to the Book Value of any Company
asset or to the Member’s Capital Accounts (except as provided in Treasury Regulations Section
1.704-1(b)(2)(iv)(m)) or in the determination or allocation of Profit or Loss for purposes other
than such tax purposes.

     Section 5.8 Tax Allocations

               (A) Generally. Except as provided in Section 5.8(B) or Section 5.8(C),
for federal, state and local income tax purposes, each item of income, gain, loss or deduction
shall be allocated among the Members in the same manner and in the same proportion that the
corresponding book items have been allocated among the Members’ respective Capital Accounts.

               (B) Eric Üner January 2011 Bonus. Eclipse is paying a bonus to Eric Üner, an employee
of the Company, pursuant to a bonus letter dated as of the Effective Date (the “Eric Üner
January 2011 Bonus”). To the extent the Eric Üner January 2011 Bonus is ever deemed to be
compensation paid by the Company, then the Members agree that the resulting deduction shall be
allocated entirely to Eclipse.

               (C) Variations. In accordance with Section 704(c) of the Code and the Treasury
Regulations thereunder, income, gain, loss and deduction in respect of any property contributed to
the capital of the Company shall, solely for tax purposes, be allocated among the Members so as to
take account of any variation between the adjusted basis of such asset for federal income tax
purposes and its initial Book Value. In the event the Book Value of any Company asset is adjusted
pursuant to Treasury Regulation Section 1.704-1(b)(2)(iv)(e) or (f), subsequent allocations of
income, gain, loss and deduction in respect of such asset shall take into account any variation
between the adjusted basis of such asset for federal income tax purposes and its Book Value in the
same manner as under Section 704(c) of the Code and the Treasury Regulations thereunder.
Allocations required or permitted by this Section 5.8(C) shall be made based on any
reasonable method specified in Treasury Regulations Section 1.704-3 as the Board reasonably
determines.

ARTICLE VI

MANAGEMENT POWER, RIGHTS AND DUTIES

     Section 6.1 Management by the Board

               (A) Board. The business and affairs of the Company shall be managed under the
direction of a board of managers (the “Board”) to the fullest extent permitted by the Act.
The Board shall consist of three (3) individuals designated as follows: PCTEL shall designate two
(2) individuals, who shall initially be John W. Schoen and Anthony Kobrinetz, and Eclipse shall

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	*	 	Confidential portions of this exhibit have been redacted and filed separately with the
Securities and Exchange Commission pursuant to a confidential treatment request in
accordance with Rule 24b-2 promulgated under the Securities Exchange Act of 1934, as amended.
 Redacted portions are indicated with “[****].”

 

designate one (1) individual, who shall initially be Anthony Vitucci. An affirmative vote of
any two (2) members of the Board shall control with respect to any decision to be made by the
Board; provided, however, that the affirmative vote of all of the members of the Board shall be
required in order to approve:

                    (i) any changes to the relative rights and preferences of the Membership Interests or the
right of any Member to receive Distributions or the allocation of Profits and Losses;

                    (ii) any amendment to the First Call Matrix or the Second/Third Call Matrix;

                    (iii) any redemption, purchase or other acquisition of Membership Interests by the Company;

                    (iv) any amendment to Section 3.2 (No Liability of Members), Section 3.3
(Capital Contributions), Section 3.5 (Other Activities), ARTICLE IV (Capital
Accounts), ARTICLE V (Distributions; Allocations of Profits and Losses), Section
6.1 (Management by Board), Section 6.3 (Authority of Officers; Restrictions on Certain
Actions), Section 6.5(C) (Two-Thirds Member Approval Margin), Section 7.1 (Duties;
No Liability), Section 7.2 (Restrictive Covenants), Section 7.3 (Transactions
Between the Company and the Members), Section 7.4 (Right to Indemnification), ARTICLE
IX (Transfers and Other Events), Section 10.1 (Dissolution, Liquidation and
Termination), Section 11.1 (Arbitration Required), Section 12.3 (Indemnification
and Reimbursement for Payments on Behalf of a Member), Section 12.8 (Amendment or
Modification) or Section 12.14 (Waiver of Certain Damages);

                    (v) any amendment to Section 1.1 (Definitions) that would disproportionately and
materially adversely affect a Member;

                    (vi) any amendment to any provision of this Agreement that provides for approval of any matter
by a vote of more than a simple majority of the Members;

                    (vii) except (1) for the exercise of rights pursuant to ARTICLE IX or (2) any
migratory merger for change of domicile purposes, effecting any merger, consolidation, conversion
or similar transaction which would reasonably be expected to have a material adverse effect on
Eclipse.

PCTEL and Eclipse may remove or replace such designees at any time. In the event that Anthony
Vitucci is terminated as an employee of PCTEL or the Company for Cause (as defined herein or in an
employment agreement) or resigns, then he shall be deemed to have resigned from the Board and
Eclipse shall replace him as its designee. In the event that Eclipse (a) materially breaches its
obligations (beyond any applicable notice or cure periods) under, or (b) terminates, the Eclipse
Services Agreement, then Eclipse’s right to designate a member of the Board shall terminate, and
the size of the Board shall be reduced to two (2) members, both of

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	*	 	Confidential portions of this exhibit have been redacted and filed separately with the
Securities and Exchange Commission pursuant to a confidential treatment request in
accordance with Rule 24b-2 promulgated under the Securities Exchange Act of 1934, as amended.
 Redacted portions are indicated with “[****].”

 

whom shall be designated by PCTEL, and all decisions requiring the unanimous approval of the
members of the Board pursuant to Section 6.1(A) shall require only the approval of both of
PCTEL’s designees, subject to the restrictions set forth in Section 12.8.

               (B) General Powers. All powers of the Company shall be exercised by the Board.
Decisions of the Board within its scope of authority shall be binding upon the Company and each
Member. The Board shall have full, exclusive and complete discretion, power and authority in
furtherance of the purposes of the Company as set forth in Section 2.6 and, subject to any
other provisions of this Agreement or by non-waivable provisions of applicable law, to manage,
control, administer and operate the business and affairs of the Company and to make all decisions
affecting such business and affairs, including, without limitation, as described in Section
2.7.

               (C) Term of Office. Members of the Board shall serve until their resignation, death or
removal in accordance with Section 6.1(A) by any Person or group of Persons having the
right to designate such member of the Board.

               (D) Vacancies. Any vacancy on the Board shall be filled in accordance with Section
6.1(A).

               (E) Resignation. A member of the Board may resign as such by delivering his or her
written resignation to the Company at the Company’s principal office addressed to the Board. Such
resignation shall be effective upon receipt unless it is specified to be effective at some other
time or upon the happening of some other event.

               (F) Compensation. A member of the Board shall not be paid compensation by the Company
for his or her services as such. The foregoing shall not be deemed to limit or restrict the payment
of any reasonable compensation or remuneration to any Person in such Person’s capacity as an
Officer, advisor or consultant to the Company or any agreement or arrangement with the Company
which has been approved by the Board.

               (G) Reimbursement. The members of the Board shall be entitled to be reimbursed for
reasonable out-of-pocket costs and expenses incurred in the course of their service hereunder,
including, without limitation, attendance at Board and Member meetings.

               (H) Reliance by Third Parties. Any Person dealing with the Company, other than a
Member, may rely on the authority of the Board (or any Officer or other person authorized by the
Board) in taking any action in the name of the Company without inquiry into the provisions of this
Agreement or compliance herewith, regardless of whether that action actually is taken in accordance
with the provisions of this Agreement. Every agreement, instrument or document executed by one or
more members of the Board (or any Officer authorized by the Board) in the name of the Company in
respect of any business or property of the Company shall be conclusive evidence in favor of any
Person relying thereon or claiming thereunder that (i) at the time of the execution or delivery
thereof this Agreement was in full force and effect, (ii) such agreement,

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	*	 	Confidential portions of this exhibit have been redacted and filed separately with the
Securities and Exchange Commission pursuant to a confidential treatment request in
accordance with Rule 24b-2 promulgated under the Securities Exchange Act of 1934, as amended.
 Redacted portions are indicated with “[****].”

 

instrument or document was duly executed according to this Agreement and is binding upon the
Company, and (iii) the Board or such Officer was duly authorized and empowered to execute and
deliver such agreement, instrument or document for and on behalf of the Company.

               (I) Meetings of the Board; Actions. Meetings of the Board shall be held at the
principal place of business of the Company or at any other place that the Board determines;
provided, however, that either Member may call a meeting of the Board once per fiscal quarter.
Written notice of all meetings of the Board shall be sent to all Board members at least five (5)
Business Days prior to the meeting. At any meeting, any member of the Board may participate by
telephone or similar communication equipment, provided each member of the Board can hear the
others. Persons present by telephone shall be deemed to be present “in person” for purposes hereof.
The presence of two (2) members of the Board shall constitute a quorum for the transaction of
business. Meetings shall be held at least once each quarter, or more often in accordance with a
schedule established by the Board. In addition, any two (2) or more members of the Board may
convene a meeting thereof upon at least five (5) Business Days’ prior written notice to the other
members of the Board. The Board also may make decisions, without holding a meeting, by written
consent with at least five (5) Business Days prior written notice thereof to all members of the
Board not signing such consent. Minutes of each meeting and a record of each decision shall be kept
by the Secretary. Notwithstanding the foregoing provisions, each member of the Board who is
entitled to notice waives notice if before or after the meeting the member of the Board signs a
waiver of notice or appears at or participates in the meeting.

               (J) Reserves. The Board may from time to time establish such reserves as it shall
reasonably determine.

     Section 6.2 Officers

               (A) Designation and Appointment. The Board may, from time to time, appoint Officers of
the Company. Any number of offices may be held by the same person. In its discretion, the Board may
choose not to fill any office for any period as it may deem advisable. Officers need not be
residents of the State of Delaware or Members. Any Officers so designated shall have such authority
and perform such duties as are herein provided and as the Board may, from time to time, delegate to
them. The Board may assign titles to particular Officers. Each Officer shall hold office until his
or her successor shall be duly designated and shall qualify or until his or her death or until he
or she shall resign or shall have been removed in the manner hereinafter provided. The Officers of
the Company shall serve without compensation. The initial Officers of the Company shall be as are
as set forth on Schedule 6.2.

               (B) Resignation/Removal. Any Officer may resign as such at any time. Such resignation
shall be made in writing and shall take effect at the time specified therein, or if no time be
specified, at the time of its receipt by the Board. The acceptance of a resignation shall not be
necessary to make it effective, unless expressly so provided in the resignation. Any Officer may be
removed as such, either with or without Cause, at any time by the Board. Designation of an Officer
shall not itself create any contractual or employment rights.

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	*	 	Confidential portions of this exhibit have been redacted and filed separately with the
Securities and Exchange Commission pursuant to a confidential treatment request in
accordance with Rule 24b-2 promulgated under the Securities Exchange Act of 1934, as amended.
 Redacted portions are indicated with “[****].”

 

               (C) Duties of Officers Generally. The Officers, in the performance of their duties as
such, shall owe to the Company duties of good faith and fair dealing; provided,
however, so long as any Officer, in reasonable good faith, believes he or she is acting in
the Company’s interest, such Officer shall not be held to be in breach of duties promulgated
hereunder or otherwise be liable to any Person in any respect.

               (D) President. The President shall, subject to the powers of the Board, be the chief
administrative officer of the Company and shall have general charge of the business, affairs and
property of the Company, and control over its other Officers and agents. The President shall see
that all orders and resolutions of the Board are carried into effect and shall have authority to
suspend or to remove any agent or Officer of the Company and, in the case of the suspension for
Cause of any such Officer, to recommend to the Board what further action should be taken. In the
absence of the President and with the Board’s prior approval, the duties of the President shall be
performed and his or her authority may be exercised by any other Officer of the Company. The
President shall have such other powers and perform such other duties as may be prescribed by the
Board, and shall be a “manager” for purposes of the Act.

               (E) Vice President — Finance. The Vice President — Finance shall have shall have
general charge of the financial affairs of the Company and shall perform such duties and have such
other powers as the President (within the scope of his or her authority) or the Board may from time
to time prescribe.

               (F) Vice President — Business Development. The Vice President — Business Development
shall have shall have general charge of the sales and business development activities of the
Company and shall perform such duties and have such other powers as the President (within the scope
of his or her authority) or the Board may from time to time prescribe.

               (G) Other Vice Presidents. Each of the other Vice Presidents, if any, shall perform
such duties and have such other powers as the President (within the scope of his or her authority)
or the Board may from time to time prescribe.

               (H) Secretary. The Secretary shall have the general duties, powers and
responsibilities of a secretary of a corporation. The Secretary shall attend all meetings of the
Board and of the Members and record all of the proceedings of such meetings in a book to be kept
for that purpose. The Secretary shall keep all documents as may be required under this Agreement
and the Act. The Secretary shall perform such other duties and have such other authority as may be
prescribed elsewhere in this Agreement or from time to time by the President or the Board.

               (I) Signatory Authority. All agreements and instruments to be executed on behalf of
the Company (including without limitation checks drawn on the Company’s accounts) shall be executed
by two (2) Officers of the Company, and shall not be effective without both such signatures. Where
thus authorized, such individuals shall have the authority to bind the

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	*	 	Confidential portions of this exhibit have been redacted and filed separately with the
Securities and Exchange Commission pursuant to a confidential treatment request in
accordance with Rule 24b-2 promulgated under the Securities Exchange Act of 1934, as amended.
 Redacted portions are indicated with “[****].”

 

Company by signing contracts or agreements or understandings, subject, however, to Section
6.3.

     Section 6.3 Authority of Officers; Restrictions on Certain Actions

               (A) Authority. Subject to the provisions of this Agreement, the Officers, without the
prior approval of the Board, shall have the power and authority to take any and all actions on
behalf of the Company as are necessary, desirable or appropriate to or for the furtherance of the
purposes set forth in Section 2.6 as enumerated in Section 2.7.

               (B) Restrictions. Notwithstanding anything to the contrary contained herein, an
Officer may not take any of the following actions on behalf of the Company without the prior
written approval of the Board pursuant to Section 6.1:

                    (i) directly or indirectly sell or otherwise dispose of any material asset of the Company
outside the ordinary course of business;

                    (ii) commence (including the filing of a counterclaim), settle or otherwise dispose of any
claim or litigation, regulatory proceeding or arbitration (other than ordinary course employer or
commercial claims) to which the Company is, or is to be, a party or by which the Company or any of
its business, assets or properties may be affected;

                    (iii) directly or indirectly declare or make any Distributions upon any of the Company’s
equity securities;

                    (iv) enter into, materially modify or terminate any Material Contract;

                    (v) incur and/or pay for any expense or cost of the Company which is outside the scope of the
applicable item in the approved Annual Operating Budget;

                    (vi) create any liens or any other encumbrances whatsoever upon the assets of the Company;

                    (vii) enter into any joint venture or business alliance or create any subsidiary, or acquire
any capital stock of or other ownership interest in any Person;

                    (viii) amend or terminate any agreement relating to a joint venture or a business alliance of
the Company;

                    (ix) make any political or charitable contribution;

                    (x) enter into or consummate any transaction of the type contemplated or covered by
Section 7.3;

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	*	 	Confidential portions of this exhibit have been redacted and filed separately with the
Securities and Exchange Commission pursuant to a confidential treatment request in
accordance with Rule 24b-2 promulgated under the Securities Exchange Act of 1934, as amended.
 Redacted portions are indicated with “[****].”

 

                    (xi) delegate authority to any Person to approve the taking of any action set forth in this
Section 6.3(B);

                    (xii) do any act which would make it impossible to carry on the ordinary business of the
Company or to alter the tax status of the Company;

                    (xiii) change the name of the Company;

                    (xiv) directly or indirectly redeem, purchase or otherwise acquire any of the Company’s equity
securities;

                    (xv) authorize, issue, sell or enter into any agreement providing for the issuance (contingent
or otherwise) of any equity securities or debt securities with equity features or securities
exercisable or convertible into equity securities or debt securities with equity features;

                    (xvi) merge or consolidate with any Person;

                    (xvii) liquidate, dissolve or effect a recapitalization or reorganization in any form of
transaction;

                    (xviii) make any loans or advances to, guarantees for the benefit of, or Investments in, any
Person, except for Short-Term Investments;

                    (xix) borrow or guarantee indebtedness, or enter into or materially modify any term of any
documentation evidencing indebtedness, other than advances requested under the PCTEL Line of
Credit;

                    (xx) register any of the Company’s securities under any securities laws;

                    (xxi) make any change in the Company’s Fiscal Year;

                    (xxii) make any amendment or terminate any constitutive or governing document of the Company,
including without limitation this Agreement or the Certificate;

                    (xxiii) engage or retain any auditor other than PCTEL’s then-current auditor;

                    (xxiv) do any act in contravention of this Agreement; or

                    (xxv) commit to do any of the foregoing.

          Section 6.4 Limitation on Authority of Members

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	*	 	Confidential portions of this exhibit have been redacted and filed separately with the
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accordance with Rule 24b-2 promulgated under the Securities Exchange Act of 1934, as amended.
 Redacted portions are indicated with “[****].”

 

          No Member is an agent of the Company solely by virtue of being a Member, and no Member has
authority to act for the Company solely by virtue of being a Member. This Section 6.4
supersedes any authority granted to the Members pursuant to the Act. Any Member who takes any
action or binds the Company in violation of this Section 6.4 shall be solely responsible
for any loss and expense incurred by the Company as a result of the unauthorized action and shall
indemnify and hold the Company harmless in respect of the loss or expense.

     Section 6.5 Meetings of and Voting by Members

               (A) Notwithstanding anything to the contrary herein, no Person shall be entitled to vote in
respect of any Membership Interest unless such Person is a Member or the proxy of a Member or an
authorized representative of a Member that is not, in either case, a natural Person.

               (B) A meeting of the Members may be called at any time by the Board or by a Member. Meetings
of Members shall be held at the Company’s principal place of business or at any other place
designated by the Board. Not less than five (5) Business Days or more than sixty (60) calendar days
before each meeting, the Board shall give written notice of the meeting to each Member entitled to
vote at the meeting. The notice shall state the time, place and purpose of the meeting.
Notwithstanding the foregoing provisions, each Member who is entitled to notice waives notice if
before or after the meeting the Member signs a waiver of the notice which is filed with the records
of Members’ meetings, or is present at the meeting in person or by proxy. A Member entitled to vote
may vote either in person or by written proxy signed by the Member or by its duly authorized
attorney in fact. Persons present by telephone shall be deemed to be present “in person” for
purposes hereof.

               (C) Except as otherwise provided in this Agreement, the affirmative vote of Members holding
Membership Interests representing more than two-thirds (2/3) of the outstanding Membership
Interests entitled to vote shall be required to approve any matter coming before such Members which
is not required to be determined by the approval of the Board pursuant to the terms of this
Agreement or the Act.

               (D) In lieu of holding a meeting, the Members may vote or otherwise take action by written
consent signed Members having requisite voting power under this Agreement, subject, however, to the
limitations of the Act.

     Section 6.6 Power of Attorney

               (A) Grant of Power. Each Member constitutes and appoints the President of the Company
as the Member’s true and lawful attorney-in-fact, and in the Member’s name, place and stead, to
make, execute, sign, acknowledge, and file:

                    (i) one or more certificates of formation consistent with the terms of this Agreement;

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	*	 	Confidential portions of this exhibit have been redacted and filed separately with the
Securities and Exchange Commission pursuant to a confidential treatment request in
accordance with Rule 24b-2 promulgated under the Securities Exchange Act of 1934, as amended.
 Redacted portions are indicated with “[****].”

 

                    (ii) all documents (including amendments to the Certificate) which the attorney-in-fact deems
appropriate to reflect any written amendment, change or modification of this Agreement approved in
accordance with Section 12.8;

                    (iii) upon the requisite approval, if any, required elsewhere in this Agreement, any and all
other certificates or other instruments required to be filed by the Company under the laws of the
State of Delaware or of any other state or jurisdiction, including, without limitation, any
certificate or other instruments necessary in order for the Company to continue to qualify as a
limited liability company under the laws of the State of Delaware; and

                    (iv) all documents which may be required to dissolve and terminate the Company and to cancel
its Certificate upon the requisite approval required elsewhere in this Agreement.

               (B) Irrevocability. The foregoing power of attorney is irrevocable and is coupled with
an interest, and, to the extent permitted by applicable law, shall survive the death or disability
of a Member and any change in the identity of the President. It also shall survive the Transfer of
a Membership Interest, except that if the transferee is approved for admission as a Member, this
power of attorney shall survive the delivery of the assignment for the sole purpose of enabling the
attorney-in-fact to execute, acknowledge and file any documents needed to effectuate the
substitution. Each Member shall be bound by any representations made by the attorney-in-fact acting
in good faith pursuant to this power of attorney, and each Member hereby waives any and all
defenses which may be available to contest, negate or disaffirm the action of the attorney-in-fact
taken in good faith under this power of attorney.

     Section 6.7 Annual Operating Budget and Accounting Matters

          Not later than thirty (30) days prior to the start of each Fiscal Year subsequent to 2010, the
Company’s Officers shall submit to the Board, for the Board’s review and approval, a proposed
budget for such Fiscal Year (an “Annual Operating Budget”). Each Annual Operating Budget
shall include a proposed budget and operating plan for the Company, as well as a description of
major business objectives and challenges (including, but not limited to, major capital requirements
for the Company or the refinancing or sale of the Company) for the forthcoming Fiscal Year. The
Annual Operating Budget also shall set forth the following information for the Company on a monthly
basis with annual totals, together with an explanation of all material assumptions made in
determining the same: (i) a detailed estimate of the projected gross revenues for the Company for
the forthcoming Fiscal Year; (ii) a detailed estimate of the projected operating expenses for the
Company for the forthcoming Fiscal Year, which estimate shall set forth as separate line items the
projected operating expenses with respect to each type of expense expected to be incurred for such
year; (iii) a detailed estimate of the projected reimbursable expenses with respect to each type of
expense expected to be incurred for such year; (iv) a statement as to the projected additions to or
disbursements from such reserves for the forthcoming Fiscal Year; (v) an estimate of the projected
cash flow available for Distribution from the Company; (vi) a description of the terms and
conditions proposed with respect to

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	*	 	Confidential portions of this exhibit have been redacted and filed separately with the
Securities and Exchange Commission pursuant to a confidential treatment request in
accordance with Rule 24b-2 promulgated under the Securities Exchange Act of 1934, as amended.
 Redacted portions are indicated with “[****].”

 

material contracts relating to the Company for the forthcoming Fiscal Year; (vii) a
description of the minimum insurance coverage to be maintained with respect to the Company for the
forthcoming Fiscal Year; and (viii) and such other information as may be reasonably requested by
the Board. In addition, the Officers shall provide to the Board such other financial data and other
information as may be reasonably requested by the Board. If a proposed Annual Operating Budget has
not been approved by the Board by the date that is five (5) days prior to commencement of the
applicable Fiscal Year, the then most recent Annual Operating Budget shall continue to be in
effect, except as follows: (a) to the extent that specific line items of the proposed Annual
Operating Budget have been approved by the Board, then such specific line items shall be as so
approved; (b) subject to the immediately preceding clause, (I) the budget for any expenditures over
which the Company has little or no control, such as taxes, insurance premiums, utility charges,
interest and principal due to then-existing creditors of the Company and to the holders of liens on
Company property, and amounts payable pursuant to the terms of then-existing contracts by which the
Company is bound shall be the amount required to pay such items, and (II) the budget for all other
items shall be the applicable amount set forth in the then most recent Annual Operating Budget,
such amounts in (I) and (II) being adjusted for inflation as reflected in the Consumer Price Index
for All Urban Consumers published by the U.S. Department of Labor Bureau of Labor Statistics since
the date of such most recent Annual Operating Budget. All Annual Operating Budgets and other
reports prepared pursuant to this Section 6.7 shall be prepared in accordance with United
States generally accepted accounting principles (“GAAP”) consistently applied unless
otherwise requested by the Board.

     Section 6.8 Reporting Requirements

          The Officers shall prepare and deliver, or cause to be prepared and delivered, to the Board
and the Members the following financial reports and tax information:

               (A) Within forty-five (45) days of the end of the Fiscal Year, deliver to the Board and the
Members the audited financial reports of the Company for the Fiscal Year, audited by the
independent auditors of the Company engaged by the Board;

               (B) Within five (5) Business Days of the occurrence of such a default, give notice to the
Board and the Members of any default under any financing or breach of or default under any other
material agreement of which the Company is a party; and

               (C) Promptly deliver to the Board and the Members such additional information regarding the
Company as the Board and the Members may reasonably request from time to time.

All of the above reports, balance sheets or other financial statements shall be prepared in
accordance with GAAP (except for tax reporting information to the extent that such tax reporting
information is different from GAAP).

35

 

			
	*	 	Confidential portions of this exhibit have been redacted and filed separately with the
Securities and Exchange Commission pursuant to a confidential treatment request in
accordance with Rule 24b-2 promulgated under the Securities Exchange Act of 1934, as amended.
 Redacted portions are indicated with “[****].”

 

ARTICLE VII

EXCULPATION AND INDEMNIFICATION

     Section 7.1 Duties; No Liability

          In the event of a conflict between the interests of any Member and any other Member: (i) the
members of the Board appointed by such Member shall not be obligated to recommend or take any
action that prefers the interests of the Company or the other Members over their respective
interests or the interests of such Member, and (ii) each Member hereby waives both (A) the
fiduciary duty, including the duty of care and the duty of loyalty, if any, of the members of the
Board and the Members owed to the Company and/or its Members and (B) any claim or cause of action
against the members of the Board and the Members for any breach of fiduciary duty owed to the
Company or the Members by any such Person; provided, however, that such Persons shall act in good
faith. No Member, member of the Board, or Officer of the Company shall have any duty to the
Company or any Member of the Company except for the duties of good faith and fair dealing. Except
as otherwise provided in this Agreement, no Member, member of the Board, or Officer of the Company
shall be liable to the Company or to any Member for any loss or damage sustained by the Company or
to any Member, nor be in breach of this Agreement, unless the loss or damage shall have been the
result of gross negligence, fraud or intentional misconduct by the Member, member of the Board, or
Officer in question or, in the case of a member of the Board or an Officer, breach of such Person’s
duties pursuant to Section 6.2(C). In performing his, her or its duties, each such Person
shall be entitled to rely in good faith on the provisions of this Agreement and on information,
opinions, reports or statements (including financial statements and information, opinions, reports
or statements as to the value or amount of the assets, liabilities, profits or losses of the
Company or any facts pertinent to the existence and amount of assets from which Distributions to
Members might properly be paid) of the following other Persons or groups: one or more Officers of
the Company, any attorney, independent accountant, appraiser or other expert or professional
employed or engaged by or on behalf of the Company or the Board; or any other Person who has been
selected with reasonable care by or on behalf of the Company, or the Board in each case as to
matters which such relying Person reasonably believes to be within such other Person’s competence.
The preceding sentence shall in no way limit any Person’s right to rely on information to the
extent provided in Section 18-406 of the Act. No Member, member of the Board, or Officer of the
Company shall be personally liable under any judgment of a court, or in any other manner, for any
debt, obligation or liability of the Company, whether that liability or obligation arises in
contract, tort or otherwise, solely by reason of being a Member, member of the Board, or Officer of
the Company, or any combination of the foregoing.

     Section 7.2 Restrictive Covenants.

The following restrictive covenants (the “Restrictive Covenants”) shall apply to the
Members, the Restricted Member Affiliates, the members of the Board and the Officers:

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	*	 	Confidential portions of this exhibit have been redacted and filed separately with the
Securities and Exchange Commission pursuant to a confidential treatment request in
accordance with Rule 24b-2 promulgated under the Securities Exchange Act of 1934, as amended.
 Redacted portions are indicated with “[****].”

 

               (A) Confidentiality. Without limiting the applicability of any other agreement to
which any Person may be subject, no Member, Restricted Member Affiliate, member of the Board or
Officer shall, directly or indirectly, disclose or use at any time, whether during the Restricted
Period or thereafter, any Confidential Information of which such Person is or becomes aware. Each
such Person in possession of Confidential Information shall take all appropriate steps to safeguard
such information and to protect it against disclosure, misuse, espionage, loss and theft.
Notwithstanding the above, such a Person may disclose Confidential Information to the extent that
(i) the disclosure is necessary for him, her or it to fulfill duties to the Company pursuant to
this Agreement or any other written agreement, (ii) the disclosure is required by law or a court
order, or (iii) the disclosure is necessary to enforce rights hereunder; provided, however, that
Eclipse may not disclose or use any Confidential Information in connection with any sale of, or
attempt to sell its Membership Interest pursuant to Section 9.5, except pursuant to a
nondisclosure agreement in a form acceptable to the Board in its reasonable discretion, not to be
unreasonably withheld, delayed or conditioned.

               (B) Non-Competition. During the Restricted Period, no Member or Restricted Member
Affiliate shall, directly or indirectly, in any capacity, engage or invest in, own, manage,
operate, finance, control, be employed by, or be associated with any business venture or activity
engaged in the acquisition, development, ownership, management, exploitation, licensing,
sublicensing or disposition of any secure smartphone or related products competitive with the
Products, anywhere in the world; provided, however, that he, she or it may purchase or otherwise
acquire up to (but not more than) one percent (1%) of any class of securities of any enterprise
(without otherwise participating in the activities of such enterprise) if such securities are
listed on any national or registered security exchange or have been registered under Section 12(g)
of the Securities Exchange Act of 1934.

               (C) Non-Solicitation. During the Restricted Period, PCTEL, Eclipse, the Restricted
Member Affiliates, the members of the Board and the Officers shall not, directly or indirectly, in
any capacity, whether for his, her or its own account or the account of any other Person (i)
solicit, employ, or otherwise engage as an employee, independent contractor, or otherwise, any
person who is or was an employee or independent contractor of the Company or in any manner induce
or attempt to induce any such Person to terminate his or her employment or retention with the
Company; or (ii) interfere with or attempt to divert the Company’s relationship with any Person,
including without limitation any of the Company’s (1) suppliers, (2) vendors, (3) customers, or (4)
potential customers with whom the Company has held substantive discussions regarding the Products.
Notwithstanding the foregoing, each Member shall be entitled to hire or engage any employee or
independent contractor of the Company who was employed or retained by such Member prior to the date
of this Agreement.

               (D) Non-Disparagement. During the Restricted Period and indefinitely thereafter, no
Member, Restricted Member Affiliate, member of the Board or Officer shall, directly or indirectly,
in any forum or manner, disparage the Company, its Members, the members of the Board, the Officers
or the Affiliates of the Members.

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	*	 	Confidential portions of this exhibit have been redacted and filed separately with the
Securities and Exchange Commission pursuant to a confidential treatment request in
accordance with Rule 24b-2 promulgated under the Securities Exchange Act of 1934, as amended.
 Redacted portions are indicated with “[****].”

 

               (E) Additional Restricted Member Affiliates. During the term of this Agreement, each
Member shall require, as a condition of employment or retention by such Member, that each Person
employed or retained by such Member who, if affiliated with such Member as of the date of this
Agreement could reasonably be expected to have executed this Agreement as a Restricted Member
Affiliate, execute a joinder to this Agreement in a form prescribed by the Board pursuant to which
such Person shall become an additional Restricted Member Affiliate as if such Person were an
original signatory to this Agreement; provided, however, that so long as there is no transfer of
Anthony Vitucci’s ownership interest in Eclipse, Thomas Smigelski shall not be required to become
an additional Restricted Member Affiliate.

               (F) Maximum Enforceable Scope. If, at the time of enforcement of any of the
Restrictive Covenants, a court of competent jurisdiction determines that the restrictions stated
therein are unenforceable under applicable law and the circumstances then existing, then such
covenant shall extend only to the maximum enforceable duration, scope of conduct prohibited or
geographical extent as determined by such court.

               (G) Injunctive Relief. The Members and the Restricted Member Affiliates acknowledge
that any remedy at law for any breach of the Restrictive Covenants would be inadequate and,
notwithstanding any other provision of this Agreement, consent to the granting by any court of an
injunction or other equitable relief, without the necessity of actual monetary loss being proved,
in order that a breach or threatened breach of the Restrictive Covenants may be effectively
enjoined, and without the necessity of posting a bond or other security in excess of $1,000.

     Section 7.3 Transactions Between the Company and the Members

          Notwithstanding that it may constitute a conflict of interest, the Members, the members of the
Board, or their respective Affiliates may engage in any transaction (including, without limitation,
any amendment, supplement or other modification made to such transaction) with the Company
(including, without limitation, the purchase, sale, lease or exchange of any property or the
rendering of any service with the Company) so long as such transaction (including, without
limitation, any amendment, supplement or other modification made to such transaction) is at arm’s
length and approved by a majority of the disinterested members of the Board. Notwithstanding the
foregoing, however, the Eclipse Services Agreement, the PCTEL Line of Credit Documents, the PCTEL
Services Agreement, and the rights of the Members pursuant to Section 9.2, Section
9.3, Section 9.5 and Section 9.6 are hereby approved by the Members and shall
not require the approval of a majority of the disinterested members of the Board.

     Section 7.4 Right to Indemnification

          Subject to the limitations and conditions provided in this ARTICLE VII, each Person
who was or is made a party or is threatened to be made a party to or is involved in any threatened,
pending or completed action, suit or proceeding, whether civil, criminal, administrative or
arbitrative (hereinafter, a “Proceeding”), or any appeal in such a Proceeding or

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	*	 	Confidential portions of this exhibit have been redacted and filed separately with the
Securities and Exchange Commission pursuant to a confidential treatment request in
accordance with Rule 24b-2 promulgated under the Securities Exchange Act of 1934, as amended.
 Redacted portions are indicated with “[****].”

 

any inquiry or investigation that could lead to such a Proceeding, by reason of the fact that
such Person, or a Person of which such Person is the legal representative, is or was a Member, a
member of the Board, or an Officer shall be indemnified by the Company to the fullest extent
permitted by applicable law, as the same exists or may hereafter be amended (but, in the case of
any such amendment, only to the extent that such amendment permits the Company to provide broader
indemnification rights than said law permitted the Company to provide prior to such amendment)
against judgments, penalties (including excise and similar taxes and punitive damages), fines,
settlements and reasonable expenses (including, without limitation, reasonable attorneys’ and
experts’ fees) actually incurred by such Person in connection with such Proceeding, appeal, inquiry
or investigation (each, a “Claim”), unless such Claim shall have been the result of gross
negligence, fraud or intentional misconduct by such Person, in which case such indemnification
shall not cover such Claim to the extent resulting from such gross negligence, fraud or intentional
misconduct. Indemnification under this Section 7.4 shall continue as to a Person who has
ceased to serve in the capacity or retain the status which initially entitled such Person to
indemnity hereunder. The rights granted pursuant to this Section 7.4 shall be deemed
contract rights, and no amendment, modification or repeal of this Section 7.4 shall have
the effect of limiting or denying any such rights in respect of actions taken or Proceedings,
appeals, inquiries or investigations arising prior to any amendment, modification or repeal.

     Section 7.5 Nonexclusivity of Rights

          The right to indemnification and the advancement and payment of expenses conferred in
Section 7.4 shall not be exclusive of any other right that a Member, member of the Board,
Officer or other Person indemnified pursuant to Section 7.4 may have or hereafter acquire
under any law (common or statutory) or provision of this Agreement.

     Section 7.6 Insurance

          The Company shall obtain and maintain, at its expense, insurance to protect itself and any
Member, member of the Board, Officer or other agent of the Company against any expense, liability
or loss for which such Person would be entitled to indemnification from the Company pursuant to
Section 7.4.

     Section 7.7 Savings Clause

          If Section 7.4 or any portion thereof shall be invalidated on any ground by any court
of competent jurisdiction, then the Company shall nevertheless indemnify and hold harmless each
Person indemnified pursuant to Section 7.4 as to costs, charges and expenses (including
reasonable attorneys’ fees), judgments, fines and amounts paid in settlement in respect of any such
Proceeding, appeal, inquiry or investigation to the full extent permitted by any applicable portion
of Section 7.4 that shall not have been invalidated and to the fullest extent permitted by
applicable law.

     Section 7.8 Limited Liability

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	*	 	Confidential portions of this exhibit have been redacted and filed separately with the
Securities and Exchange Commission pursuant to a confidential treatment request in
accordance with Rule 24b-2 promulgated under the Securities Exchange Act of 1934, as amended.
 Redacted portions are indicated with “[****].”

 

          Except as otherwise provided by the Act, the debts, obligations and liabilities of the
Company, whether arising in contract, tort or otherwise, shall be solely the debts, obligations and
liabilities of the Company, and no Member, member of the Board, or Officer of the Company shall be
obligated personally for any such debt, obligation or liability of the Company solely by reason of
being a Member, member of the Board, or Officer of the Company. Neither the Members nor any member
of the Board shall be required to lend any funds to the Company. Each of the Members shall only be
liable to make payment of required Capital Contributions as and when due hereunder and other
payments as expressly provided in this Agreement. If and to the extent a Member shall have made all
Capital Contributions in accordance with the preceding sentence, such Member shall not, except as
required by the express provisions of the Act regarding repayment of sums wrongfully distributed to
Members, be required to make any further contributions. No Member in its capacity as a Member shall
have any power to represent, act for, sign for or bind the members of the Board or the Company, and
the Members hereby consent to the exercise by the Board and Officers of the Company of the powers
conferred on them by law and this Agreement.

ARTICLE VIII

TAXES

     Section 8.1 Tax Returns

          The President shall cause to be prepared and timely filed all necessary federal, state and
local income tax returns for the Company, and shall make any elections and filings it may deem
appropriate and in the best interests of the Members as a group. The President shall further cause
all such tax returns or reports required to be filed by the Company to be sent to each Member for
its review and comment at least fifteen (15) Business Days prior to filing. Such tax returns shall
be subject to each Member’s approval, such approval not to be unreasonably withheld. Each Member
shall furnish to the Company all pertinent information in its possession relating to Company
operations that is necessary to enable the Company’s income tax returns to be prepared and filed.
The Company shall furnish all pertinent information to the Members that is necessary to determine
amounts includable on their tax returns in respect of the Company (including Schedule K-1) as soon
as reasonably practicable after the end of the Taxable Year taking into account any extension
period granted by the relevant authority having jurisdiction over such matters.

     Section 8.2 Tax Matters Partner

          The Board shall designate any Member to serve as a tax matters partner (subject to
replacement) as and when required pursuant to Section 6231(a)(7) of the Code (the “Tax Matters
Partner”), and such Tax Matters Partner shall take reasonable action to cause each other Member
to be treated as a “notice partner” within the meaning of Code Section 6231(a)(8). The Tax Matters
Partner, on and as of the Formation Date, shall be PCTEL. Each Member shall have the right to have
thirty (30) days advance written notice from the Tax Matters Partner of the time and place of, and
to participate in (i) any administrative or judicial proceeding relating to the

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	*	 	Confidential portions of this exhibit have been redacted and filed separately with the
Securities and Exchange Commission pursuant to a confidential treatment request in
accordance with Rule 24b-2 promulgated under the Securities Exchange Act of 1934, as amended.
 Redacted portions are indicated with “[****].”

 

determination of Company tax items at the Company level, and (ii) any discussions with the
Internal Revenue Service relating to the allocations pursuant to ARTICLE V. Notwithstanding
anything in this Section 8.2 to the contrary, the Tax Matters Partner shall not initiate
any action or proceeding in any court, extend any statute of limitations, or take any other action
contemplated by Code Sections 6222 through 6232 that would legally bind any other Member other than
indirectly through the Company being bound by such action. The Company shall, upon the request of
any Member, confer (or cause the Company’s advisers to confer) with such Member and its advisers on
any matters relating to a Company tax return or any tax election. Promptly following the written
request of the Tax Matters Partner, the Company shall, to the fullest extent permitted by law,
reimburse and indemnify the Tax Matters Partner for all reasonable expenses, including reasonable
legal and accounting fees, claims, liabilities, losses and damages incurred by the Tax Matters
Partner in connection with any administrative or judicial proceeding (i) in respect of the tax
liability of the Company and/or (ii) in respect of the tax liability of the Members in connection
with the operations of the Company. The provisions of this Section 8.2 shall survive the
termination of the Company or the termination of any Member’s interest in the Company and shall
remain binding on the Members for as long a period of time as is necessary to resolve with the
Internal Revenue Service any and all matters regarding the Federal income taxation of the Company
or the Members.

ARTICLE IX

TRANSFERS AND OTHER EVENTS

     Section 9.1 Transfer of Membership Interest in the Company

          Except as provided in this ARTICLE IX, no Member shall Transfer, or permit or suffer
any Transfer of, all or any portion of its Membership Interests to any Person other than the
Company (as the case may be, a “Transferee”) without the prior approval of the Board, which
approval may be granted or withheld in the sole and absolute discretion of the Board.
Notwithstanding any other provision of this Agreement, no attempted Transfer to any transferee who
is not a “U.S. Person” within the meaning of Section 120.15 of the International Traffic in Arms
Regulation (ITAR), 22 CFR Chapter I, Subchapter M, Parts 120-130 shall be valid.

     Section 9.2
First Call Right; Put Right 

               (A) First Call Right. At any time during the First Call Period, PCTEL may issue a
notice to Eclipse (a “First Call Notice”) requiring it to sell to PCTEL Membership
Interests equal to 19% of the Percentage Interests at the First Call Price (the “First
Call”). The closing date for the First Call shall be specified in the First Call Notice and
shall be no earlier than twenty (20) days, and no later than sixty (60) days, following the date of
the First Call Notice (the “First Call Closing Date”). PCTEL shall pay the First Call
Price in cash to Eclipse on the First Call Closing Date. Simultaneously with the payment of the
First Call Price, Eclipse shall execute and deliver to PCTEL such assignments and other instruments
as may be reasonably required to vest in PCTEL all right, title, and interest in and to the
purchased Membership Interests, free and clear of all liens and encumbrances, together with such
additional instruments as may be required to

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	*	 	Confidential portions of this exhibit have been redacted and filed separately with the
Securities and Exchange Commission pursuant to a confidential treatment request in
accordance with Rule 24b-2 promulgated under the Securities Exchange Act of 1934, as amended.
 Redacted portions are indicated with “[****].”

 

effect a Code Section 754 election, which instruments shall contain only customary
representations and warranties as to power and authority, title and liens and encumbrances.

               (B) Put Right. If PCTEL does not exercise the First Call, then at any time during the
Put Period, Eclipse may issue a notice to PCTEL (a “Put Notice”) requiring it to purchase
from Eclipse Membership Interests then held by Eclipse equal to 19% of the Percentage Interests, at
the Put Price (the “Put”). The closing date for the Put shall be specified in the Put
Notice and shall be no earlier than twenty (20) days, and no later than sixty (60) days, following
the date of the Put Notice (the “Put Closing Date”). PCTEL shall pay the Put Price in cash
to Eclipse on the Put Closing Date. Simultaneously with the payment of the Put Price, Eclipse
shall execute and deliver to PCTEL such assignments and other instruments as may be reasonably
required to vest in PCTEL all right, title, and interest in and to the purchased Membership
Interests, free and clear of all liens and encumbrances, together with such additional instruments
as may be required to effect a Code Section 754 election, which instruments shall contain only
customary representations and warranties as to power and authority, title and liens and
encumbrances.

     Section 9.3 Second Call Right

          At any time during the Second Call Period, PCTEL may issue a notice to Eclipse (a “Second
Call Notice”) requiring it to sell to PCTEL all Membership Interests then held by Eclipse, at
the Second Call Price (the “Second Call”). The closing date for the Second Call shall be
specified in the Second Call Notice and shall be no earlier than twenty (20) days, and no later
than sixty (60) days, following the date of the Second Call Notice (the “Second Call Closing
Date”). PCTEL shall pay the Second Call Price in cash to Eclipse on the Second Call Closing
Date. Simultaneously with the payment of the Second Call Price, Eclipse shall execute and deliver
to PCTEL such assignments and other instruments as may be reasonably required to vest in PCTEL all
right, title, and interest in and to the purchased Membership Interests, free and clear of all
liens and encumbrances, together with such additional instruments as may be required to effect a
Code Section 754 election, which instruments shall contain only customary representations and
warranties as to power and authority, title and liens and encumbrances.

     Section 9.4 Eclipse Participation Right

          If PCTEL exercises the Second Call, and within twelve months after the closing of the Second
Call Period effects a Qualifying Sale of the Company, then PCTEL shall pay to Eclipse, at the
closing of such Qualifying Sale of the Company, ten percent (10%) of the amount, if any, by which
(a) the Net Proceeds received by PCTEL in such Qualifying Sale of the Company exceed (b) the
Enterprise Value of the Company used to calculate the Second Call Price. If PCTEL exercises the
Second Call, and at any time during the period beginning on the thirteenth month and ending on the
twenty-fourth month following the end of the Second Call Period effects a Qualifying Sale of the
Company, then PCTEL shall pay to Eclipse, at the closing of such transaction, five percent (5%) of
the amount, if any, by which (a) the Net Proceeds received by PCTEL in such Qualifying Sale of the
Company exceed (b) the Enterprise Value of the

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	*	 	Confidential portions of this exhibit have been redacted and filed separately with the
Securities and Exchange Commission pursuant to a confidential treatment request in
accordance with Rule 24b-2 promulgated under the Securities Exchange Act of 1934, as amended.
 Redacted portions are indicated with “[****].”

 

Company used to calculate the Second Call Price. In the event that any such Net Proceeds are
received by PCTEL in a form other than cash (e.g., stock of an acquirer), Eclipse shall be entitled
to ten percent (10%) or five percent (5%), as applicable, of such non-cash consideration, and shall
not be entitled to cash in lieu thereof. Notwithstanding anything contained in this Section
9.4, PCTEL shall have no obligation to effect a Sale of the Company.

     Section 9.5 Eclipse Exit Option; Right of First Refusal

          If PCTEL does not exercise the Second Call, then within ten (10) days of the expiration of the
Second Call Period, the Company shall notify PCTEL and Eclipse of the Company’s Enterprise Value as
of the end of the Second Call Period (the “Enterprise Value Notice”). If the Enterprise
Value as of the end of the Second Call Period is less than or equal to $4,900,000 (as
calculated by the Board pursuant to the Second/Third Call Matrix and the accompanying calculation
principles), then PCTEL shall have the rights set forth in Section 9.6. If the Enterprise
Value as of the end of the Second Call Period is greater than $4,900,000, then Eclipse may
solicit purchasers for its entire Membership Interest for a period of six (6) months from the end
of the Second Call Period (the “Marketing Period”). At any time during the Marketing
Period, Eclipse may issue a notice to PCTEL (a “Third Party Sale Notice”) of its receipt of
a bona fide written offer and letter of intent, term sheet or similar document to sell all, but not
less than all, of its Membership Interests to a single third party (a “Third Party
Purchaser”) for cash, which Third Party Sale Notice shall include a true and correct copy of
such letter of intent, term sheet or similar document. PCTEL shall thereafter have thirty (30) days
(such period, the “Offer Period”) from its receipt of such notice to notify Eclipse in
writing of its election to acquire Eclipse’s Membership Interests on the terms set forth therein.
Should PCTEL fail to notify Eclipse in writing of such an election within the Offer Period, it
shall be deemed to have elected not to purchase such Membership Interests and Eclipse may sell them
on the terms and subject to the conditions set forth in the Third Party Sale Notice; provided,
however, that should (i) the gross price for the sale of such Membership Interests be reduced below
ninety-five percent (95%) of the price set forth in the Third Party Sale Notice, or (ii) a period
of thirty (30) days after the date of delivery of the Third Party Sale Notice expires without a
sale of such Membership Interests, PCTEL shall have its right to purchase same reinstated in
accordance with the procedure set forth in this Section 9.5. Notwithstanding the
foregoing, no sale of Membership Interests to a Third Party Purchaser may be made pursuant to this
Section 9.5 unless (a) all of the Company’s obligations pursuant to the PCTEL Line of
Credit Documents have are paid in full in cash from the proceeds of such Third-Party Sale or from
Eclipse (and in no event out of the proceeds of any Capital Contributions of PCTEL), (b) such Third
Party Purchaser is not engaged in a business competitive with that of the Company or PCTEL (as
determined, in each case, in good faith by the Board), and (c) such sale is closed within eight (8)
months following the end of the Second Call Period (the “Eclipse Exit Period”).

     Section 9.6 PCTEL Exit Options

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	*	 	Confidential portions of this exhibit have been redacted and filed separately with the
Securities and Exchange Commission pursuant to a confidential treatment request in
accordance with Rule 24b-2 promulgated under the Securities Exchange Act of 1934, as amended.
 Redacted portions are indicated with “[****].”

 

          If Eclipse does not complete a sale of its Membership Interests as contemplated by Section
9.5 within the Eclipse Exit Period, PCTEL may elect any of the following alternatives at any
time thereafter by issuing a written notice to Eclipse:

               (A) Third Call Right. PCTEL may issue a notice to Eclipse (a “Third Call
Notice”) requiring it to sell to PCTEL all Membership Interests then held by Eclipse, at the
Third Call Price (the “Third Call”). The Closing date for the Third Call shall be
specified in the Third Call Notice and shall be no earlier than twenty (20) days, and no later than
sixty (60) days, following the date of the Third Call Notice (the “Third Call Closing
Date”). PCTEL shall pay the Third Call Price in cash to Eclipse on the Third Call Closing
Date. Simultaneously with the payment of the Third Call Price, Eclipse shall execute and deliver
to PCTEL such assignments and other instruments as may be reasonably required to vest in PCTEL all
right, title, and interest in and to the purchased Membership Interests, free and clear of all
liens and encumbrances, together with such additional instruments as may be required to effect a
Code Section 754 election, which instruments shall contain only customary representations and
warranties as to power and authority, title and liens and encumbrances.

               (B) Approved Sale. PCTEL may elect to sell all, but not less than all, of its
Membership Interests to a third-party purchaser (an “Approved Sale”). In connection with
an Approved Sale, the parties shall have the following rights:

                    (i) Drag-Along Right. PCTEL may, by written notice to Eclipse (a “Drag-Along
Notice”), require Eclipse to sell all of its Membership Interests to such third-party purchaser
on terms and conditions substantially identical to those on which PCTEL will sell its Membership
Interests, and Eclipse shall vote for, consent to and raise no objections against the Approved
Sale. Not in limitation of the foregoing, in connection with an Approved Sale, Eclipse agrees to
take all steps necessary to comply, and to enable it to comply, with the provisions of this
Section 9.6(B)(i), including without limitation the execution and delivery of appropriate
instruments of transfer and such other agreements and instruments as may reasonably be required by
the purchaser or PCTEL for the closing of the Approved Sale at such date and time as PCTEL shall
specify. In connection with an Approved Sale: (1) Eclipse shall be required to make customary
representations or warranties relating to (i) its own due incorporation and execution and delivery
of the relevant agreements and instruments, (ii) the enforceability of such agreements and
instruments against it, (iii) the absence of conflicts with agreements, laws and court and
governmental orders applicable to it, (iv) its ownership of the Membership Interests being sold by
it free and clear of all liens and encumbrances except those arising under this Agreement, and (v)
such other representations or warranties as are reasonably necessary in order to effect the
transfer of Membership Interests contemplated thereby; (2) Eclipse shall not be required to provide
any indemnities except as provided in clause (3); (3) Eclipse may be required to execute and
deliver the applicable purchase and sale agreements and in the event that a portion of the purchase
price is required by the terms of such agreements to be placed in escrow or otherwise withheld to
support purchase price adjustment obligations post-closing (including as it relates to
indemnification required by the purchaser in a transaction for breaches of

44

 

			
	*	 	Confidential portions of this exhibit have been redacted and filed separately with the
Securities and Exchange Commission pursuant to a confidential treatment request in
accordance with Rule 24b-2 promulgated under the Securities Exchange Act of 1934, as amended.
 Redacted portions are indicated with “[****].”

 

representations or warranties relating to the Company and/or the Membership Interests or
assets sold), Eclipse will have a pro rata portion of its purchase price placed in such escrow or
otherwise withheld to be utilized to pay any such purchase price adjustment and/or indemnification
obligations; and (4) Eclipse shall not be required to agree to restrictive covenants that would
materially impair its ability to conduct its business as conducted as of the date of this Agreement
(exclusive of the activities of the Company). Eclipse hereby consents to the appointment of a
member representative by the Board for the purposes of all dealings with same and to the
indemnification of such member representative for all actions taken in good faith in relation to
same, all pursuant to a member representative agreement in a form approved by the Board in its
reasonable discretion, which Eclipse agrees to execute promptly upon receipt.

                    (ii) Tag-Along Right. Eclipse may, by written notice to PCTEL (a “Tag-Along
Notice”), require that, as a condition of such Approved Sale, such third-party purchaser
purchase all of Eclipse’s Membership Interests on terms and conditions substantially identical to
those under which PCTEL will sell its Membership Interests.

                    (iii) Conditions of Approved Sale. If the Approved Sale is structured as a merger or
consolidation, Eclipse shall waive any dissenters’ rights, appraisal rights or similar rights in
connection with such merger or consolidation. Eclipse shall take all necessary or desirable
actions in connection with the consummation of the Approved Sale as may reasonably be requested by
PCTEL. The obligations of Eclipse with respect to an Approved Sale are subject to the satisfaction
of the following conditions: (i) upon the consummation of the Approved Sale, both Members shall
receive the same form of consideration and the same amount of consideration for their Membership
Interests (subject to ratable adjustment for their relative Percentage Interests and taking into
account any differences in their Capital Accounts and the allocations and Distributions associated
with their Membership Interests); and (ii) if either Member is given an option as to the form and
amount of consideration to be received, both Members shall be given the same option. Each Member
will bear its pro rata share (subject to ratable adjustment for their relative Percentage
Interests) of the costs of any sale of Membership Interests pursuant to an Approved Sale to the
extent such costs are incurred for the benefit of both Members and are not otherwise paid by the
Company or the acquiring party. For purposes of this Section 9.6(B)(i), costs incurred in
exercising reasonable efforts to take all actions in connection with the consummation of an
Approved Sale shall be deemed to be for the benefit of all Members. Costs incurred by a Member on
its own behalf will not be considered costs of the transaction hereunder.

               (C) Failed Venture Election. If the Enterprise Value as of the end of the Second Call
Period is less than or equal to $4,900,000, PCTEL may make a Failed Venture Election
pursuant to Section 10.1(D).

45

 

			
	*	 	Confidential portions of this exhibit have been redacted and filed separately with the
Securities and Exchange Commission pursuant to a confidential treatment request in
accordance with Rule 24b-2 promulgated under the Securities Exchange Act of 1934, as amended.
 Redacted portions are indicated with “[****].”

 

     Section 9.7 Transfers Generally; Substituted Members; Rights and Obligations of
Transferees and Transferring Members

               (A) Requirements. Without limiting the provisions of the remainder of this ARTICLE
IX, a Transfer shall be valid hereunder only if:

                    (i) the Member proposing to make a Transfer of all or any portion of its Membership Interests
(the “Transferring Member”) and the Transferee each executes and delivers to the Company
such documents and instruments of conveyance as may be reasonably requested by the Board to effect
such Transfer and to confirm the agreement of the Transferee to be bound by the provisions of this
Agreement;

                    (ii) the Transferring Member and Transferee provide to the Board the Transferee’s taxpayer
identification number and any other information reasonably necessary to permit the Company to file
all required federal and state tax returns and other legally required information statements or
returns. Without limiting the generality of the foregoing, the Company shall not be required to
make any Distribution otherwise provided for in this Agreement in respect of any Membership
Interests transferred until the Board has received such information;

                    (iii) the Transferring Member furnishes to the Company (unless otherwise approved by the
Board) an opinion of counsel, which counsel and opinion shall be reasonably satisfactory to the
Board, that (a) the Transfer will not cause the Company to be deemed to be an “investment company”
under the Investment Company Act, (b) the Transfer will not cause the Company to be taxed as a
corporation pursuant to Section 7704 of the Code and will not result in a termination of the
Company within the meaning of Section 708 of the Code, and (c) either the Membership Interests
transferred have been registered under the Securities Act and any applicable state securities laws
or the Transfer is exempt from all applicable registration requirements and will not violate any
applicable laws regulating the Transfer of securities; and

                    (iv) the Transferring Member reimburses the Company for all costs and expenses that the
Company reasonably incurs in connection with the Transfer.

               (B) No Dissolution. A Transfer by a Member or other Person shall not itself dissolve
the Company or entitle the Transferee to become a Member or exercise any rights of a Member.

               (C) Voting. Except as the Board may otherwise provide in a written consent approving
the transfer of voting rights in connection with a proposed Transfer, such consent, if requested by
the Transferring Member, not to be unreasonably withheld, delayed or conditioned, a Transfer by a
Member shall eliminate the Member’s power and right to vote (in proportion to the extent of the
Membership Interests Transferred) on any matter submitted to the Members, and, for voting purposes,
such Membership Interests shall not be counted as outstanding in proportion to the extent of the
Membership Interests Transferred. A Transfer shall not otherwise

46

 

			
	*	 	Confidential portions of this exhibit have been redacted and filed separately with the
Securities and Exchange Commission pursuant to a confidential treatment request in
accordance with Rule 24b-2 promulgated under the Securities Exchange Act of 1934, as amended.
 Redacted portions are indicated with “[****].”

 

eliminate the Member’s entitlement to any rights associated with the Member’s remaining
interest, including, without limitation, rights to information, and shall not cause the Member to
be released from any liability to the Company solely as a result of the Transfer.

               (D) Admission of Transferee as Member. A Transferee shall become a substituted Member
entitled to all the rights of a Member in respect of a Transferred Membership Interest if and only
if (i) the Transferring Member gives the Transferee such right (which shall be presumed in the case
of any voluntary Transfer unless the instrument of assignment expressly excludes such right), (ii)
either (a) such admission is approved by the Board or (b) such Transfer is a Permitted Transfer,
and (iii) the Transferee has agreed in writing to be bound by the provisions of this Agreement. If
the Transferee is admitted as a Member pursuant to this Section 9.7(D), (I) the voting and
other rights associated with the Membership Interest held by the Transferee shall be restored and
transferred to the Transferee and be held by the Transferee in its capacity as substituted Member
along with all other rights in respect of the Transferred Membership Interests and (II) this
Agreement shall be amended to admit such Transferee as a Member and to reflect the elimination of
the Transferring Member (or the reduction of such Membership Interest) and (if and to the extent
then required by the Act) a certificate of amendment to the Certificate reflecting such admission
and elimination (or reduction) shall be filed in accordance with the Act. The admission of any
substitute Member pursuant to this ARTICLE IX shall be deemed effective on the effective
date of such amendment to this Agreement. A Transferee that is not admitted as a Member pursuant to
this Section 9.7(D) shall be entitled only to the share in the Distributions and other
economic benefits in respect of the Transferred Membership Interests and shall have no other rights
(including, without limitation, rights to approve matters that require the unanimous approval of
all of the Members, or rights to any information or accounting of the affairs of the Company or to
inspect the books or records of the Company) in respect of the Transferred Membership Interests.
The Transferee shall have no liability as a Member solely as a result of the Transfer unless
admitted as a Member pursuant to this Section 9.7(D); provided, however, the Transferee
shall in all cases be subject to all of the Transfer restrictions and other obligations applicable
to a Member under this ARTICLE IX. The Company shall be entitled to treat the record owner
of any interest in the Company as the absolute owner thereof and shall incur no liability for
Distributions of cash or other property made in good faith to such owner until such time as a
written assignment of such Membership Interest is permitted pursuant to the terms and conditions
provided herein, and such assignment has been received and approved by the Board and has been
recorded on the books of the Company.

               (E) Release. Notwithstanding the admission of a Transferee as a Member, unless
released by the Board, the Transferring Member shall not be released from any obligations to the
Company existing as of the date of the Transfer (other than obligations of the Transferring Member
to make future Capital Contributions), but such admission shall cause the Transferring Member to
cease to be a Member in respect of the Membership Interests transferred when the Transferee becomes
a Member. In any such case, the admission of the Transferee as a Member shall constitute the
requisite consent of the Members to continue the business of the Company

47

 

			
	*	 	Confidential portions of this exhibit have been redacted and filed separately with the
Securities and Exchange Commission pursuant to a confidential treatment request in
accordance with Rule 24b-2 promulgated under the Securities Exchange Act of 1934, as amended.
 Redacted portions are indicated with “[****].”

 

notwithstanding that such admission will cause the termination of the membership of the
Transferring Member in respect of the Membership Interests transferred.

     Section 9.8 Distributions and Allocations Regarding Transferred Membership Interests

          Upon any Transfer during any Taxable Year of the Company made in compliance with the
provisions of this ARTICLE IX, profits, losses, each item thereof and all other items
attributable to such Membership Interests for such Taxable Year shall be divided and allocated
between the Transferring Member and the Transferee by taking into account the periods of time of
their respective Membership Interests during such Taxable Year, using any conventions permitted by
law and selected by the Board. All Distributions on or before the date of such Transfer shall be
made to the Transferring Member and all Distributions thereafter shall be made to the Transferee.
Solely for purposes of making such allocations and Distributions, the Company shall recognize such
Transfer not later than the end of the calendar month during which it is given notice of such
Transfer, provided that, if the Company is given notice of a Transfer at least ten (10)
Business Days prior to the Transfer, the Company shall recognize such Transfer as the date of such
Transfer, and provided, further, that, if the Company does not receive a notice
stating the date such Membership Interest was transferred and such other information as the Board
may reasonably require within thirty (30) days after the end of the Taxable Year during which the
Transfer occurs, then all such items shall be allocated, and all Distributions shall be made, to
the Member that, according to the books and records of the Company, was the owner of the Membership
Interests on the last day of the Taxable Year during which the Transfer occurs. Neither the Company
nor the Board shall incur any liability for making allocations and Distributions in accordance with
the provisions of this Section 9.8, whether or not the Company or the Board has knowledge
of any Transfer of any Membership Interests.

     Section 9.9 Resignation

          No Member shall have the right to resign or withdraw as a Member without the prior written
approval of all of the Members, which each Member may give or withhold in its sole and absolute
discretion. Any Member that resigns without the approval of all of the Members in contravention of
this Section 9.9 shall be liable to the Company for all damages (including all lost profits
and special, indirect and consequential damages) directly or indirectly caused by the resignation
of such Member, and such Member shall be entitled to receive the fair value of its Membership
Interest as of the date of its resignation (or, if less, the fair value of its interest as of the
winding-up of the Company), as conclusively determined by the Board, only following the occurrence
of the winding-up of the Company.

     Section 9.10 No Appraisal Rights

          No Member shall be entitled to any appraisal rights in respect of such Member’s Membership
Interest, whether individually or as part of any class or group of Members, in the

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	*	 	Confidential portions of this exhibit have been redacted and filed separately with the
Securities and Exchange Commission pursuant to a confidential treatment request in
accordance with Rule 24b-2 promulgated under the Securities Exchange Act of 1934, as amended.
 Redacted portions are indicated with “[****].”

 

event of a merger, consolidation, or other transaction involving the Company or its securities
unless such rights are expressly provided herein or by the agreement of merger, agreement of
consolidation or other document effectuating such transaction.

     Section 9.11 Void Assignment

          Any Transfer by any Member in contravention of this Agreement shall be void and ineffectual
and shall not bind or be recognized by the Company or any other Person. In the event of any
Transfer in contravention of this Agreement, the purported transferee shall have no right to any
profits, losses or Distributions of the Company or any other rights of a Member.

ARTICLE X

DISSOLUTION, LIQUIDATION AND TERMINATION

     Section 10.1 Dissolution

          The Company shall be dissolved and its affairs shall be wound up on the first to occur of the
following:

               (A) the unanimous approval of all of the Members as evidenced by each Member’s written
direction to its respective Board members to approve such termination;

               (B) the sale by the Company of substantially all of its business assets;

               (C) the entry of a decree of judicial dissolution of the Company under Section 18-802 of the
Act; and

               (D) at the election of PCTEL in the event of a Failed Venture at any time within the nine (9)
month period following the end of the Second Call Period (a “Failed Venture Election”).

The death, retirement, resignation, expulsion, incapacity, bankruptcy or dissolution of a Member,
or the occurrence of any other event that terminates the continued membership of a Member in the
Company, shall not cause a dissolution of the Company, and the Company shall continue in existence
subject to the terms and conditions of this Agreement.

     Section 10.2 Liquidation and Termination

               (A) Board as Liquidator. Upon dissolution of the Company, the Board shall act as
liquidator or may appoint one or more Officers as liquidator. The liquidator shall thereafter use
commercially reasonable efforts to wind up the affairs of the Company, sell the Company’s assets at
the best price available and make final Distributions as provided herein and in the Act.

               (B) Liquidation Procedures. The costs of liquidation shall be borne as a Company
expense. Until final Distribution, the liquidator shall continue to operate the Company with all

49

 

			
	*	 	Confidential portions of this exhibit have been redacted and filed separately with the
Securities and Exchange Commission pursuant to a confidential treatment request in
accordance with Rule 24b-2 promulgated under the Securities Exchange Act of 1934, as amended.
 Redacted portions are indicated with “[****].”

 

of the power and authority of the Board. The steps to be accomplished by the liquidator are as
follows:

                    (i) As promptly as possible after dissolution and again after final liquidation, the
liquidator(s) shall cause a proper accounting to be made by a recognized firm of certified public
accountants of the Company’s assets, liabilities and operations through the last day of the
calendar month in which the dissolution occurs or the final liquidation is completed, as
applicable.

                    (ii) The liquidator(s) shall cause the notice described in the Act to be mailed to each known
creditor of and claimant against the Company in the manner described thereunder.

                    (iii) The liquidator(s) shall pay, satisfy or discharge from Company funds all of the debts,
liabilities and obligations of the Company (including, without limitation, all obligations then
outstanding with respect to the PCTEL Line of Credit and all expenses incurred in liquidation) or
otherwise make adequate provision for payment and discharge thereof (including, without limitation,
the establishment of a cash fund for contingent liabilities in such amount and for such term as the
liquidator may reasonably determine).

                    (iv) The balance, if any, of the Company’s remaining assets shall be distributed to the
Members in the order and priority set forth in Section 5.3; provided, however, that in
connection with a liquidation following a Failed Venture Election, (a) the Company’s intellectual
property, and all tangible personal property containing same, shall be conveyed to PCTEL, and all
Members shall execute such agreements and instruments as may reasonably be required to vest or
confirm title to same in PCTEL, without payment of additional consideration, and (b) PCTEL and
Eclipse shall enter into a license agreement substantially in the form attached as Exhibit
D, with the license fees and royalties thereunder to be determined upon liquidation by a
mutually-acceptable intellectual property appraisal service (the “Intellectual Property License
Agreement”).

Distributions pursuant to this Section 10.2(B) shall be made by the end of the Taxable Year
of the Company during which the liquidation occurs (or, if later, ninety (90) days after the date
of the liquidation). Unless the liquidation follows a Failed Venture Election, the liquidator(s)
shall cause only cash, evidences of indebtedness and other securities to be distributed in any
liquidation. The Distribution of cash and/or property to a Member in accordance with the provisions
of this Section 10.2 constitutes a complete return to such Member of its Capital
Contributions and a complete distribution to the Member of its Membership Interests in all the
property owned by the Company and constitutes a compromise to which all Members have consented
within the meaning of the Act. The Distribution of cash and/or property to a Transferee who is not
a Member in accordance with the provisions of this Section 10.2 constitutes a complete
distribution to such Transferee of its Membership Interests in all property owned by the Company
and constitutes a compromise to which all Members have consented

50

 

			
	*	 	Confidential portions of this exhibit have been redacted and filed separately with the
Securities and Exchange Commission pursuant to a confidential treatment request in
accordance with Rule 24b-2 promulgated under the Securities Exchange Act of 1934, as amended.
 Redacted portions are indicated with “[****].”

 

within the meaning of the Act. To the extent that a Member returns funds to the Company, it has no
claim against any other Member for those funds.

     Section 10.3 Deemed Distribution and Reconstitution

          Notwithstanding any other provision of this ARTICLE X, in the event the Company is
“liquidated” within the meaning of Treasury Regulation Section 1.704-1(b)(2)(ii)(g), the Company’s
assets shall not be liquidated, the Company’s liabilities shall not be paid or discharged, and the
Company’s affairs shall not be wound up. Instead, the Company shall be deemed solely for income tax
purposes, to have contributed its assets to a newly-created income tax partnership in exchange for
such company’s assumption of the Company’s liabilities and equity interests in such new income tax
partnership. Immediately thereafter, the Company shall be deemed, solely for income tax purposes,
to have distributed the interest in the new income tax partnership to the Members in accordance
with their Capital Accounts.

     Section 10.4 Deficit Capital Accounts

          Notwithstanding any custom or rule of law to the contrary, to the extent that any Member has a
deficit Capital Account balance, upon dissolution of the Company such deficit shall not be an asset
of the Company and such Members shall not be obligated to contribute such amount to the Company to
bring the balance of such Member’s Capital Account to zero.

     Section 10.5 Cancellation of Certificate

          On completion of the Distribution of Company assets as provided herein, the Company is
terminated, and shall file a certificate of cancellation with the Secretary of State of the State
of Delaware, cancel any other filings made pursuant to Section 2.1 and take such other
actions as may be necessary to terminate the Company.

ARTICLE XI

ARBITRATION

     Section 11.1 Arbitration Required

               (A) Any and all Arbitrable Disputes that cannot be resolved between the Members, or a Member
and the Company, as applicable (the “Disputing Parties”), within thirty (30) days following
delivery of a written notice from one Disputing Party to the other(s) addressing such Arbitrable
Dispute, including the determination of the scope or applicability of this agreement to arbitrate,
shall be determined by arbitration in Chicago, Illinois, before one arbitrator (the
“Arbitrator”). The arbitration shall be administered by JAMS, Inc. pursuant to its
Streamlined Arbitration Rules and Procedures. Judgment on the arbitral award may be entered in any
court having jurisdiction. This clause shall not preclude parties from seeking provisional remedies
in aid of arbitration from a court of appropriate jurisdiction. The arbitrator may, in the Award,
allocate all or part of the costs of the arbitration, including the fees of the arbitrator and

51

 

			
	*	 	Confidential portions of this exhibit have been redacted and filed separately with the
Securities and Exchange Commission pursuant to a confidential treatment request in
accordance with Rule 24b-2 promulgated under the Securities Exchange Act of 1934, as amended.
 Redacted portions are indicated with “[****].”

 

the reasonable attorneys’ fees of the prevailing party. If more than one issue shall be
submitted to the same Arbitrator for resolution, each such issue shall be deemed a separate
arbitration for all purposes hereof, such issues shall be identified separately by the Disputing
Parties in their submission to arbitration, and each such issue shall be subject to a separate
decision by the Arbitrator. Any Arbitrator appointed hereunder shall be mutually acceptable to the
Disputing Parties; provided, however, if the Disputing Parties are unable to mutually agree upon an
Arbitrator, each of the Disputing Parties shall appoint an arbitrator (an “Appointing
Arbitrator”) and such Appointing Arbitrators shall then mutually select an Arbitrator for the
applicable Arbitrable Dispute (but such Appointing Arbitrators shall not themselves administer or
be otherwise involved in such Arbitrable Dispute).

               (B) Notwithstanding anything in this ARTICLE XI to the contrary, the Disputing Parties
shall have the right to commence litigation or other legal proceedings with respect to any claims
solely relating to: (i) preserving or protecting Confidential Information, (ii) other emergency or
injunctive relief, or (iii) enforcement of the dispute resolution provisions of this Agreement
and/or any arbitration award.

               (C) Any litigation (permitted herein) or arbitration of an Arbitrable Dispute must be
initiated within one (1) year from the date on which any Disputing Party first gave written notice
to the other Disputing Party(ies) of the existence of the Arbitrable Dispute, and any Disputing
Party who fails to commence litigation or arbitration within such one-year period shall be deemed
to have waived any of its affirmative rights and claims in connection with the Arbitrable Dispute
and shall be barred from asserting such rights and claims at any time thereafter. An arbitration
shall be deemed commenced by a Disputing Party when such Disputing Party sends a notice to the
other Disputing Party(ies), identifying the Arbitrable Dispute and requesting arbitration.
Litigation shall be deemed commenced by a Disputing Party when such Disputing Party serves a
complaint on the other Member(s) with respect to the Arbitrable Dispute.

     Section 11.2 GOVERNING LAW; DAMAGE RESTRICTIONS

          THE ARBITRATOR SHALL HAVE NO AUTHORITY TO VARY OR IGNORE THE TERMS OF THIS AGREEMENT, SHALL BE
BOUND BY SECTION 12.16 WITH RESPECT TO GOVERNING LAW, AND SHALL BE BOUND BY SECTION
12.14 WITH RESPECT TO DAMAGES. ALL PROCEEDINGS, AWARDS AND DECISIONS UNDER ANY ARBITRATION
PROCEEDING SHALL BE STRICTLY PRIVATE AND CONFIDENTIAL.

     Section 11.3 Compensation of Arbitration Tribunal

          As soon as practicable after selection of the Arbitration Tribunal, the Arbitration Tribunal
or its designated representative shall determine a reasonable estimate of the anticipated fees and
costs, and send a statement to each Disputing Party setting forth that Disputing Party’s share of
the fees and costs, which shall be proportional to their respective Percentage Interests. Within
ten

52

 

			
	*	 	Confidential portions of this exhibit have been redacted and filed separately with the
Securities and Exchange Commission pursuant to a confidential treatment request in
accordance with Rule 24b-2 promulgated under the Securities Exchange Act of 1934, as amended.
 Redacted portions are indicated with “[****].”

 

(10) days after receipt of the statement, each Disputing Party shall deposit the required sum
with the Arbitration Tribunal, as applicable.

ARTICLE XII

GENERAL/MISCELLANEOUS PROVISIONS

     Section 12.1 Offset

          Whenever the Company is to pay any sum to any Member, any amounts that such Member owes to the
Company may be deducted from that sum before payment; provided, however, that the full
amount that would otherwise be distributed shall be debited from the Member’s Capital Account
pursuant to Section 4.1.

     Section 12.2 Waiver of Certain Rights

          Except as expressly provided herein, each Member irrevocably waives any right it may have to
demand any distributions or withdrawal of property from the Company or to maintain any action for
dissolution (except pursuant to Section 18-802 of the Act) of the Company or for partition of the
property of the Company.

     Section 12.3 Indemnification and Reimbursement for Payments on Behalf of a Member

          If the Company is obligated to pay any amount to a Governmental Body because of a Member’s
status or otherwise specifically attributable to a Member (including, without limitation, federal,
state or local withholding taxes imposed in respect of any issuance of Membership Interests to a
Member or any payments to a Member, federal withholding taxes in respect of foreign Persons, state
personal property taxes, state personal property replacement taxes, state unincorporated business
taxes, etc.), then such Member (the “Indemnifying Member”) shall indemnify the Company in
full for the entire amount paid. At the option of the Board, either:

               (A) promptly upon notification of an obligation to indemnify the Company, the Indemnifying
Member shall make a cash payment to the Company equal to the full amount to be indemnified
(provided that the amount paid shall not be treated as a Capital Contribution); or

               (B) the Company shall reduce Distributions that would otherwise be made to the Indemnifying
Member, until the Company has recovered the amount to be indemnified (provided that the amount of
such reduction shall be deemed to have been distributed for all purposes of this Agreement).

An Indemnifying Member’s obligation to indemnify the Company under this Section 12.3 shall
survive the termination, dissolution, liquidation and winding up of the Company and, for purposes
of this Section 12.3, the Company shall be treated as continuing in existence. The

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	*	 	Confidential portions of this exhibit have been redacted and filed separately with the
Securities and Exchange Commission pursuant to a confidential treatment request in
accordance with Rule 24b-2 promulgated under the Securities Exchange Act of 1934, as amended.
 Redacted portions are indicated with “[****].”

 

Company may pursue and enforce all rights and remedies it may have against each Indemnifying Member
under this Section 12.3, including instituting a lawsuit to collect any amounts owed to the
Company by such Indemnifying Member pursuant to this Section 12.3 with interest calculated
at the Prime Rate plus one hundred (100) basis points per annum (but not in excess of the highest
rate per annum permitted by law).

     Section 12.4 Notices

          Except as expressly set forth to the contrary in this Agreement, all notices, demands or other
communications to be given or delivered under or by reason of the provisions of this Agreement must
be in writing and shall be deemed delivered: (i) upon delivery if delivered in person; (ii) if
mailed by deposit in the United States mail, addressed to the recipient, postage paid, and
registered or certified with return receipt requested, then upon the date indicated in such return
receipt; (iii) upon transmission if sent via telecopier, with a confirmation copy sent via a
national overnight courier for next Business Day delivery, provided that confirmation of such
overnight delivery is received; or (iv) one (1) Business Day after deposit with a national
overnight courier for next Business Day delivery, provided that confirmation of such overnight
delivery is received. All notices, requests and consents to be sent to a Member must be sent to or
made at the address (or facsimile number) given for that Member on Exhibit C, or such other
address (or facsimile number) as that Member may specify by notice to the other Members. Copies
thereof must be sent to each Member’s legal counsel, as such counsel shall have been designated by
each Member to the Company from time to time. Any notice, request or consent to the Company or the
Board must be given to the Board and, if appointed, the Secretary of the Company at the Company’s
chief executive offices. Whenever any notice is required to be given by law or this Agreement, a
written waiver thereof, signed by the Person entitled to notice, whether before or after the time
stated therein, shall be deemed equivalent to the giving of such notice.

     Section 12.5 Public Announcements

          No Member shall make any public announcement or filing in respect of the transactions provided
for herein without the approval of the Board, unless such Member has been advised by counsel such
disclosure is required by applicable law. To the extent reasonably feasible, any press release or
other announcement or notice regarding the transactions contemplated by this Agreement shall be
made by the Board or any other party designated by the Board.

     Section 12.6 Entire Agreement

          This Agreement and other written agreements among the Members and their Affiliates relating to
the Company of even date herewith constitute the entire agreement among the Members relating to the
Company and supersede all prior contracts or agreements in respect of the Company, whether oral or
written.

54

 

			
	*	 	Confidential portions of this exhibit have been redacted and filed separately with the
Securities and Exchange Commission pursuant to a confidential treatment request in
accordance with Rule 24b-2 promulgated under the Securities Exchange Act of 1934, as amended.
 Redacted portions are indicated with “[****].”

 

     Section 12.7 Effect of Waiver or Consent

          A waiver or consent, express or implied, of or to any breach or default by any Person in the
performance by that Person of its obligations hereunder or in respect of the Company is not a
consent or waiver of or to any other breach or default in the performance by that Person of the
same or any other obligations of that Person hereunder or in respect of the Company. Failure on the
part of a Person to complain of any act of any Person or to declare any Person in default hereunder
or in respect of the Company, irrespective of how long that failure continues, does not constitute
a waiver by that Person of its rights in respect of that default until the applicable
statute-of-limitations period has run.

     Section 12.8 Amendment or Modification

          This Agreement and any provision hereof may be amended or modified from time to time only by a
written instrument approved by the Board on the terms set forth in Section 6.1(A) or by a
Member or Members holding a majority of the Membership Interests; provided, however, that for so
long as Eclipse holds Membership Interests, any amendment of this Agreement involving (a) any
change in the relative rights and preferences of the Members, (b) the issuance of additional
Membership Interests of any class or description, or rights exercisable for same, (c) any change to
the First Call Matrix or the Second/Third Call Matrix, or (d) any change to Section 6.1(A)
shall require the unanimous approval of the Members.

     Section 12.9 Severability

          In the event that any one or more of the phrases, sentences, sections, articles or sections
contained in this Agreement shall be declared invalid or unenforceable by order, decree or judgment
of any court having jurisdiction, or shall be or become invalid or unenforceable by virtue of any
applicable law, the remainder of this Agreement shall be construed as if such phrases, sentences,
sections, articles or sections had not been inserted except when such construction (i) shall
operate as an undue hardship on any Member or (ii) shall constitute a substantial deviation from
the general intent and purposes of the Members as reflected in this Agreement. In the event of
either (i) or (ii) above, the Members shall use commercially reasonable efforts to negotiate a
mutually satisfactory amendment to this Agreement to circumvent such adverse construction. If no
such amendment has been agreed upon within sixty (60) days, the Members shall submit the matter to
arbitration in accordance with the provisions of ARTICLE XI.

     Section 12.10 Successors and Assigns

          Except as otherwise provided herein, this Agreement is binding on and shall inure to the
benefit of the parties hereto and their respective heirs, legal representatives, administrators,
executors, successors and permitted assigns.

     Section 12.11 Further Assurances

55

 

			
	*	 	Confidential portions of this exhibit have been redacted and filed separately with the
Securities and Exchange Commission pursuant to a confidential treatment request in
accordance with Rule 24b-2 promulgated under the Securities Exchange Act of 1934, as amended.
 Redacted portions are indicated with “[****].”

 

          In connection with this Agreement and the transactions contemplated hereby, each Member shall
execute and deliver any additional documents and instruments and perform any additional acts that
may be necessary or appropriate to effectuate and perform the provisions of this Agreement and
those transactions.

     Section 12.12 Notice to Members of Provisions

          By executing this Agreement, each Member acknowledges that it has actual notice of (i) all of
the provisions hereof (including, without limitation, the restrictions on the transfer set forth in
ARTICLE IX) and (ii) all of the provisions of the Certificate.

     Section 12.13 Prevailing Parties

          If any litigation or other court action, arbitration or similar adjudicatory proceeding is
commenced by any Member to enforce its rights under this Agreement against any other Member, all
fees, costs and expenses, including, without limitation, reasonable attorneys fees and court costs,
incurred by the prevailing Member in such litigation, action, arbitration or proceeding shall be
reimbursed by the losing Member; provided, however, that if a Member to such litigation, action,
arbitration or proceeding prevails in part, and loses in part, the court, arbitrator or other
adjudicator presiding over such litigation, action, arbitration or proceeding shall award a
reimbursement of the fees, costs and expenses incurred by such Member on an equitable basis.

     Section 12.14 WAIVER OF CERTAIN DAMAGES

          NOTWITHSTANDING ANYTHING TO THE CONTRARY IN THIS AGREEMENT OR UNDER APPLICABLE LAW, EACH
MEMBER (FOR ITSELF AND ITS LEGAL REPRESENTATIVES, SUCCESSORS AND ASSIGNS) HEREBY UNCONDITIONALLY
AND IRREVOCABLY WAIVES AND DISCLAIMS ALL RIGHTS TO CLAIM OR SEEK (WHETHER ON BEHALF OF IT OR THE
COMPANY) ANY CONSEQUENTIAL, PUNITIVE, EXEMPLARY, STATUTORY OR TREBLE DAMAGES AND ACKNOWLEDGES AND
AGREES THAT THE RIGHTS AND REMEDIES IN THIS AGREEMENT WILL BE ADEQUATE IN ALL CIRCUMSTANCES FOR ANY
CLAIMS THE MEMBERS OR THE COMPANY MIGHT HAVE WITH RESPECT THERETO.

     Section 12.15 Third Parties

          Nothing herein expressed or implied is intended or shall be construed to confer upon or give
to any person or entity, other than the parties to this Agreement, any Persons entitled to
indemnification by the Company or a Member under an express provision of this Agreement, and each
of their respective successors and permitted assigns, any rights or remedies under or by reason of
this Agreement.

     Section 12.16 Governing Law

56

 

			
	*	 	Confidential portions of this exhibit have been redacted and filed separately with the
Securities and Exchange Commission pursuant to a confidential treatment request in
accordance with Rule 24b-2 promulgated under the Securities Exchange Act of 1934, as amended.
 Redacted portions are indicated with “[****].”

 

          THIS AGREEMENT IS GOVERNED BY AND SHALL BE CONSTRUED IN ACCORDANCE WITH THE LAW OF THE STATE
OF DELAWARE EXCLUDING ANY CONFLICT-OF-LAWS RULE OR PRINCIPLE THAT MIGHT REFER THE GOVERNANCE OR THE
CONSTRUCTION OF THIS AGREEMENT TO THE LAW OF ANOTHER JURISDICTION.

     Section 12.17 Waiver of Jury Trial

          The parties to this Agreement each hereby waives, to the fullest extent permitted by law, any
right to a jury trial of any claim, demand, action, or cause of action (i) arising under this
Agreement or (ii) in any way connected with or related or incidental to the dealings of the parties
hereto in respect of this Agreement or any of the transactions related hereto, in each case whether
now existing or hereafter arising, and whether in contract, tort, equity or otherwise. The parties
to this Agreement each hereby agrees and consents that, subject to ARTICLE XI, any such
claim, demand, action, or cause of action shall be decided by court trial without a jury and that
the parties to this Agreement may file an original counterpart of a copy of this Agreement with any
court as written evidence of the consent of the parties hereto to the waiver of their right to
trial by jury.

     Section 12.18 Counterparts; Facsimile

          This Agreement may be executed in multiple counterparts with the same effect as if all signing
parties had signed the same document. All counterparts shall be construed together and constitute
the same instrument. This Agreement may be executed by the parties and transmitted by facsimile and
when it is executed and transmitted in such manner this Agreement shall be for all purposes as
effective as if the party(s) had delivered an executed original of this Agreement.

     Section 12.19 Descriptive Headings

          The descriptive headings of this Agreement are inserted for convenience only and do not
constitute a substantive part of this Agreement.

     Section 12.20 Conflicts

          In the event of a direct conflict between the provision of this Agreement and any provision of
the Certificate or any mandatory provision of the Act, the applicable provision of the Certificate
or the Act shall control. Whenever possible, each provision of this Agreement shall be interpreted
in such manner as to be effective and valid under applicable law, but if any provision of this
Agreement is held to be invalid, illegal or unenforceable in any respect under applicable law or
rule in any jurisdiction, such invalidity, illegality or unenforceability shall not affect the
validity, legality or enforceability of any other provision of this Agreement in such jurisdiction
or affect the validity, legality or enforceability of any provision in any other jurisdiction, but
this Agreement shall be reformed, construed and enforced in such jurisdiction as if such invalid,
illegal or unenforceable provision had never been contained herein.

57

 

			
	*	 	Confidential portions of this exhibit have been redacted and filed separately with the
Securities and Exchange Commission pursuant to a confidential treatment request in
accordance with Rule 24b-2 promulgated under the Securities Exchange Act of 1934, as amended.
 Redacted portions are indicated with “[****].”

 

     Section 12.21 Time of the Essence; Computation of Time

          Time is of the essence for each and every provision of this Agreement. Whenever the last day
for the exercise of any privilege or the discharge or any duty hereunder shall fall upon a
Saturday, Sunday, or any date on which banks in Chicago, Illinois are authorized to be closed, the
party having such privilege or duty may exercise such privilege or discharge such duty on the next
succeeding day which is a regular Business Day.

     Section 12.22 No Strict Construction

          The parties hereto have participated jointly in the negotiation and drafting of this
Agreement. In the event an ambiguity or question of intent or interpretation arises, this Agreement
shall be construed as if drafted jointly by the parties hereto, and no presumption or burden of
proof shall arise favoring or disfavoring any party by virtue of the authorship of any of the
provisions of this Agreement.

     Section 12.23 Organizational Expenses

          The Company shall pay to the Person entitled to such payment all fees and expenses incurred by
the Company and PCTEL in connection with the organization and formation of the Company, including,
but not limited to, all legal, accounting, and similar fees and expenses of the Company and PCTEL
(but not including fees and expenses incurred in the negotiation and execution of this Agreement,
the Contribution Agreement or related exhibits thereto, which shall be borne exclusively by the
Person incurring them).

* * * * * *

58

 

			
	*	 	Confidential portions of this exhibit have been redacted and filed separately with the
Securities and Exchange Commission pursuant to a confidential treatment request in
accordance with Rule 24b-2 promulgated under the Securities Exchange Act of 1934, as amended.
 Redacted portions are indicated with “[****].”

 

          IN WITNESS WHEREOF, this Agreement has been executed by the Members as of the Effective Date.

	 	 	 	 	 
	 	PCTEL, INC.

 	 
	 	By:  	/s/ Martin H. Singer
 	 
	 	Name:  	Martin H. Singer 	 
	 	Its:  	Chief Executive Officer 	 
	 
	 	ECLIPSE DESIGN TECHNOLOGIES, INC.

 	 
	 	By:  	/s/ Thomas Smigelski
 	 
	 	Name:  	Thomas Smigelski 	 
	 	Its:  	President 	 
	 

The undersigned is executing this Agreement as a Restricted Member Affiliate solely for the
purposes of agreeing to the Restrictive Covenants set forth in Section 7.2:

	 	 	 	 	 
	/s/ Anthony Vitucci
 	 
	ANTHONY VITUCCI 	 

 

			
	*	 	Confidential portions of this exhibit have been redacted and filed separately with the
Securities and Exchange Commission pursuant to a confidential treatment request in
accordance with Rule 24b-2 promulgated under the Securities Exchange Act of 1934, as amended.
 Redacted portions are indicated with “[****].”

 

 

EXHIBIT A

MEMBERS AND CAPITAL CONTRIBUTIONS

	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	Capital	 	 	 	 	 	Percentage
	               Member	 	Contributions/Schedule	 	Agreed Value	 	Interest
	PCTEL, Inc.
	 	 	*	 	 	$	2,500,000	 	 	 	51	%
	Eclipse Design
Technologies, Inc.
	 	 	*	 	 	$	2,400,000	 	 	 	49	%

 

			
	*	 	All Capital Contributions are being made by the Members on the terms, and subject to the
conditions, of the Contribution Agreement.

 

			
	*	 	Confidential portions of this exhibit have been redacted and filed separately with the
Securities and Exchange Commission pursuant to a confidential treatment request in
accordance with Rule 24b-2 promulgated under the Securities Exchange Act of 1934, as amended.
 Redacted portions are indicated with “[****].”

 

 

EXHIBIT B

FIRST CALL MATRIX

Company Value (“CV”) equals one times the sum of trailing twelve month GAAP revenue plus non
cancelable GAAP revenue backlog deliverable within three months, measured as of the First Call Date

Enterprise Value (“EV”) equals CV less Net Indebtedness, measured as of the First Call Date,
provided that the minimum EV shall be $4.9 million.

SECOND/THIRD CALL MATRIX

Company Value (“CV”) equals 1.2 times the sum of trailing twelve month GAAP revenue plus non
cancelable GAAP revenue backlog deliverable within three months, measured as of the Second/Third
Call Date

Enterprise Value (“EV”) equals CV less Net Indebtedness, measured as of the Second/Third Call Date,
provided that the minimum EV shall be $4.9 million.

PUT MATRIX

EV equals $4.9 million.

 

			
	*	 	Confidential portions of this exhibit have been redacted and filed separately with the
Securities and Exchange Commission pursuant to a confidential treatment request in
accordance with Rule 24b-2 promulgated under the Securities Exchange Act of 1934, as amended.
 Redacted portions are indicated with “[****].”

 

 

EXHIBIT C

MEMBER NOTICE ADDRESSES

	 	 	 
	Member	 	Notice Address              
	PCTEL, Inc.

	 	471 Brighton Dr .
	 

	 	Bloomingdale, IL 60108
	 

	 	Fax: 630-233-8076
	 

	 	Attention: General Counsel
	 
	 	 
	Eclipse Design Technologies, Inc.

	 	33 West Higgins Road
	 

	 	Suite 650
	 

	 	South Barrington, IL 60010
	 

	 	Fax: 847.844.3731
	 

	 	Attention: President

 

			
	*	 	Confidential portions of this exhibit have been redacted and filed separately with the
Securities and Exchange Commission pursuant to a confidential treatment request in
accordance with Rule 24b-2 promulgated under the Securities Exchange Act of 1934, as amended.
 Redacted portions are indicated with “[****].”

 

 

EXHIBIT D

FORM OF INTELLECTUAL PROPERTY LICENSE AGREEMENT

[****]

 

			
	*	 	Confidential portions of this exhibit have been redacted and filed separately with the
Securities and Exchange Commission pursuant to a confidential treatment request in
accordance with Rule 24b-2 promulgated under the Securities Exchange Act of 1934, as amended.
 Redacted portions are indicated with “[****].”

 

 

SCHEDULE 6.2

OFFICERS

	 	 	 
	Office	 	Designee
	President

	 	Anthony Kobrinetz
	 
	 	 
	Vice President — Finance

	 	John Schoen
	 
	 	 
	Vice President — Business Development

	 	Anthony Vitucci
	 
	 	 
	Secretary

	 	Shelley Bacastow

 

			
	*	 	Confidential portions of this exhibit have been redacted and filed separately with the
Securities and Exchange Commission pursuant to a confidential treatment request in
accordance with Rule 24b-2 promulgated under the Securities Exchange Act of 1934, as amended.
 Redacted portions are indicated with “[****].”exv4w1

Exhibit 4.1

 

 

PLAINS ALL AMERICAN PIPELINE, L.P.

PAA FINANCE CORP.

as Issuers

and

THE SUBSIDIARY GUARANTORS NAMED HEREIN

as Guarantors

$600,000,000

5.00% SENIOR NOTES DUE 2021

NINETEENTH

SUPPLEMENTAL

INDENTURE

 

 Dated as of January 14, 2011 

U.S. BANK NATIONAL ASSOCIATION

as Trustee

 

 

 

 

TABLE OF CONTENTS

	 	 	 	 	 	 	 

	 
	 	 	 	 	 	 
	ARTICLE I	 	 	2	 
	Section 1.01.
	 	Establishment	 	 	2	 
	 
	 	 	 	 	 	 
	ARTICLE II DEFINITIONS AND INCORPORATION BY REFERENCE	 	 	2	 
	Section 2.01.
	 	Definitions	 	 	2	 
	Section 2.02.
	 	Other Definitions	 	 	7	 
	 
	 	 	 	 	 	 
	ARTICLE III THE NOTES	 	 	7	 
	Section 3.01.
	 	Form	 	 	7	 
	Section 3.02.
	 	Issuance of Additional Notes	 	 	7	 
	Section 3.03.
	 	Global Security Legend	 	 	8	 
	 
	 	 	 	 	 	 
	ARTICLE IV REDEMPTION AND PREPAYMENT	 	 	8	 
	Section 4.01.
	 	Optional Redemption	 	 	8	 
	 
	 	 	 	 	 	 
	ARTICLE V COVENANTS	 	 	8	 
	Section 5.01.
	 	Compliance Certificate	 	 	8	 
	Section 5.02.
	 	Limitations on Liens	 	 	9	 
	Section 5.03.
	 	Restriction of Sale-leaseback Transactions	 	 	10	 
	Section 5.04.
	 	SEC Reports; Financial Statements	 	 	11	 
	Section 5.05.
	 	Additional Subsidiary Guarantees	 	 	12	 
	 
	 	 	 	 	 	 
	ARTICLE VI SUCCESSORS	 	 	12	 
	Section 6.01.
	 	Consolidation and Mergers of the Issuers	 	 	12	 
	Section 6.02.
	 	Rights and Duties of Successor	 	 	12	 
	Section 6.03.
	 	Supplemental Indenture	 	 	13	 
	 
	 	 	 	 	 	 
	ARTICLE VII DEFAULTS AND REMEDIES	 	 	13	 
	Section 7.01.
	 	Events of Default	 	 	13	 
	 
	 	 	 	 	 	 
	ARTICLE VIII LEGAL DEFEASANCE AND COVENANT DEFEASANCE	 	 	15	 
	Section 8.01.
	 	Option to Effect Legal Defeasance or Covenant Defeasance	 	 	15	 
	Section 8.02.
	 	Legal Defeasance and Discharge	 	 	15	 
	Section 8.03.
	 	Covenant Defeasance	 	 	15	 
	Section 8.04.
	 	Conditions to Legal or Covenant Defeasance	 	 	16	 
	Section 8.05. 
	 	Deposited Money and U.S. Government Obligations to be Held in Trust; Other Miscellaneous Provisions	 	 	17	 
	Section 8.06.
	 	Repayment to Issuers	 	 	18	 
	Section 8.07.
	 	Reinstatement	 	 	18	 
	 
	 	 	 	 	 	 
	ARTICLE IX SUBSIDIARY GUARANTEES	 	 	18	 
	Section 9.01.
	 	Subsidiary Guarantees	 	 	18	 
	Section 9.02.
	 	Limitation on Liability	 	 	20	 
	Section 9.03.
	 	Successors and Assigns	 	 	20	 

-i-

 

	 	 	 	 	 	 	 

	Section 9.04.
	 	No Waiver	 	 	20	 
	Section 9.05.
	 	Modification	 	 	21	 
	Section 9.06.
	 	Execution of Supplemental Indenture for Future Subsidiary Guarantors	 	 	21	 
	Section 9.07.
	 	Release of Guarantee	 	 	21	 
	 
	 	 	 	 	 	 
	ARTICLE X MISCELLANEOUS	 	 	21	 
	Section 10.01.
	 	Additional Amendments	 	 	21	 
	Section 10.02.
	 	Integral Part	 	 	22	 
	Section 10.03.
	 	Adoption, Ratification and Confirmation	 	 	22	 
	Section 10.04.
	 	Counterparts	 	 	22	 
	Section 10.05.
	 	Governing Law	 	 	22	 
	 
	 	 	 	 	 	 
	EXHIBIT A:
	 	Form of Note	 	 	 	 
	EXHIBIT B:
	 	Form of Supplemental Indenture	 	 	 	 

-ii-

 

          NINETEENTH SUPPLEMENTAL INDENTURE dated as of January 14, 2011 (this “Supplemental Indenture”)
among PLAINS ALL AMERICAN PIPELINE, L.P., a Delaware limited partnership (the “Partnership”), PAA
FINANCE CORP., a wholly owned subsidiary of the Partnership and a Delaware corporation (“PAA
Finance” and, together with the Partnership, the “Issuers”), and the subsidiary guarantors
signatory hereto (the “Subsidiary Guarantors”), and U.S. BANK NATIONAL ASSOCIATION, as trustee (the
“Trustee”).

WITNESSETH:

          WHEREAS, the Issuers have heretofore entered into an Indenture, dated as of September 25, 2002
(the “Original Indenture”), with U.S. Bank National Association (successor to Wachovia Bank,
National Association), as trustee;

          WHEREAS, the Original Indenture, as supplemented by this Supplemental Indenture, is herein
called the “Indenture;”

          WHEREAS, under the Original Indenture, a new series of Debt Securities may at any time be
established by the Boards of Directors of the Managing General Partner and PAA Finance in
accordance with the provisions of the Original Indenture and the form and terms of such series may
be established by a supplemental indenture executed by the Issuers and the Trustee;

          WHEREAS, also under the Original Indenture, guarantors with respect to a series of Debt
Securities may be added as parties to the Indenture by a supplemental indenture executed by
themselves, the Issuers and the Trustee;

          WHEREAS, the Issuers propose to create under the Indenture a new series of Debt Securities,
such series to be guaranteed by the Subsidiary Guarantors;

          WHEREAS, additional Debt Securities of other series hereafter established, except as may be
limited in the Original Indenture as at the time supplemented and modified, may be issued from time
to time pursuant to the Original Indenture as at the time supplemented and modified; and

          WHEREAS, all conditions necessary to authorize the execution and delivery of this Supplemental
Indenture and to make it a valid and binding obligation of the Issuers and the Subsidiary
Guarantors have been done or performed.

          NOW, THEREFORE, in consideration of the agreements and obligations set forth herein and for
other good and valuable consideration, the sufficiency of which is hereby acknowledged, the parties
hereto hereby agree as follows:

 

 

ARTICLE I

          Section 1.01. Establishment. (a) There is hereby established a new series of Debt Securities to be issued under the
Indenture, to be designated as the Issuers’ 5.00% Senior Notes due 2021 (the “Notes”).

          (b) There are to be authenticated and delivered $600,000,000 principal amount of Notes on the
Issue Date, and from time to time thereafter there may be authenticated and delivered an unlimited
principal amount of Additional Notes.

          (c) The Notes shall be issued initially in the form of one or more Global Securities in
substantially the form set out in Exhibit A hereto. The Depositary with respect to the Notes shall
be The Depository Trust Company.

          (d) Each Note shall be dated the date of authentication thereof and shall bear interest from
the date of original issuance thereof or from the most recent date to which interest has been paid
or duly provided for.

          (e) If and to the extent that the provisions of the Original Indenture are duplicative of, or
in contradiction with, the provisions of this Supplemental Indenture, the provisions of this
Supplemental Indenture shall govern.

ARTICLE II

DEFINITIONS AND INCORPORATION BY REFERENCE

          Section 2.01. Definitions. All capitalized terms used herein and not otherwise defined below shall have the meanings
ascribed thereto in the Original Indenture. The following are additional definitions used in this
Supplemental Indenture:

          “Affiliate” of any specified Person means any other Person directly or indirectly controlling
or controlled by or under direct or indirect common control with such specified Person. For
purposes of this definition, “control,” as used with respect to any Person, shall mean the
possession directly or indirectly of the power to direct or cause the direction of the management
or policies of such Person, whether through the ownership of voting securities, by agreement or
otherwise; and the terms “controlling,” “controlled by” and “under common control with” shall have
correlative meanings.

          “Attributable Indebtedness,” when used with respect to any Sale-leaseback Transaction, means,
as at the time of determination, the present value (discounted at the rate set forth or implicit in
the terms of the lease included in such transaction) of the total obligations of the lessee for
rental payments (other than amounts required to be paid on account of property taxes, maintenance,
repairs, insurance, assessments, utilities, operating and labor costs and other items that do not
constitute payments for property rights) during the remaining term of the lease included in such
Sale-leaseback Transaction (including any period for which such lease has been
extended). In the case of any lease that is terminable by the lessee upon the payment of a
penalty or other termination payment, such amount shall be the lesser of the amount determined
assuming termination upon the first date such lease may be terminated (in which case the amount

2

 

shall also include the amount of the penalty or termination payment, but no rent shall be
considered as required to be paid under such lease subsequent to the first date upon which it may
be so terminated) or the amount determined assuming no such termination.

          “Capital Interests” means any and all shares, interests, participations, rights or other
equivalents (however designated) of capital stock, including, without limitation, with respect to
partnerships, partnership interests (whether general or limited) and any other interest or
participation that confers on a Person the right to receive a share of the profits and losses of,
or distributions of assets of, such Person.

          “Consolidated Net Tangible Assets” means, at any date of determination, the total amount of
assets after deducting therefrom: (1) all current liabilities (excluding (a) any current
liabilities that by their terms are extendible or renewable at the option of the obligor thereon to
a time more than 12 months after the time as of which the amount thereof is being computed; and (b)
current maturities of long-term debt); and (2) the amount, net of any applicable reserves, of all
goodwill, trade names, trademarks, patents and other like intangible assets, all as set forth on
the consolidated balance sheet of the Partnership for its most recently completed fiscal quarter,
prepared in accordance with GAAP.

          “Debt” means any obligation created or assumed by any Person for the repayment of money
borrowed, any purchase money obligation created or assumed by such Person, and any guarantee of the
foregoing.

          “Funded Debt” means all Debt maturing one year or more from the date of the creation thereof,
all Debt directly or indirectly renewable or extendible, at the option of the debtor, by its terms
or by the terms of any instrument or agreement relating thereto, to a date one year or more from
the date of the creation thereof, and all Debt under a revolving credit or similar agreement
obligating the lender or lenders to extend credit over a period of one year or more.

          “Guarantee” means a guarantee of the Notes given by a Subsidiary Guarantor pursuant to the
Indenture, including all obligations under Article IX hereof.

          “General Partner” means PAA GP LLC, a Delaware limited liability company, and its successors
and permitted assigns as general partner of the Partnership.

          “Issue Date” means, with respect to the Notes, the date on which the Notes are initially
issued.

          “Managing General Partner” means (i) Plains All American GP LLC, a Delaware limited liability
company, and its successors and permitted assigns as the general partner of the sole member of the
General Partner or (ii) the business entity with the ultimate authority to manage the business and
operations of the Partnership.

          “Notes” has the meaning assigned to it in Section 1.01(a) hereof, and includes both the Notes
issued on the Issue Date and any Additional Notes issued thereafter.

3

 

          “Obligations” means any principal, interest, liquidated damages, penalties, fees,
indemnifications, reimbursement obligations, damages and other liabilities payable under the
documentation governing any Debt.

          “Pari Passu Debt” means any Funded Debt of either of the Issuers, whether outstanding on the
Issue Date or thereafter created, incurred or assumed, unless, in the case of any particular Funded
Debt, the instrument creating or evidencing the same or pursuant to which the same is outstanding
expressly provides that such Funded Debt shall be subordinated in right of payment to the Notes.

          “Partnership Agreement” means the Third Amended and Restated Agreement of Limited Partnership
of Plains All American Pipeline, L.P., amended and restated effective as of June 27, 2001, as
amended by Amendment No. 1 thereto dated as of April 15, 2004, Amendment No. 2 thereto dated as of
November 15, 2006, Amendment No. 3 thereto dated as of August 16, 2007, Amendment No. 4 thereto
dated April 14, 2008, to be effective as of January 1, 2007, Amendment No. 5 thereto dated as of
May 28, 2008, Amendment No. 6 thereto dated as of September 3, 2009 and as such may be otherwise
amended, modified or supplemented from time to time.

          “Permitted Liens” means:

     (1) Liens upon rights-of-way for pipeline purposes;

     (2) any statutory or governmental Lien or Lien arising by operation of law, or any
mechanics’, repairmen’s, materialmen’s, suppliers’, carriers’, landlords’, warehousemen’s or
similar Lien incurred in the ordinary course of business which is not yet due or which is
being contested in good faith by appropriate proceedings and any undetermined Lien which is
incidental to construction, development, improvement or repair;

     (3) the right reserved to, or vested in, any municipality or public authority by the
terms of any right, power, franchise, grant, license, permit or by any provision of law, to
purchase or recapture or to designate a purchaser of, any property;

     (4) Liens of taxes and assessments which are (A) for the then current year, (B) not at
the time delinquent, or (C) delinquent but the validity of which is being contested at the
time by an Issuer or any Restricted Subsidiary in good faith;

     (5) Liens of, or to secure performance of, leases, other than capital leases;

     (6) any Lien upon, or deposits of, any assets in favor of any surety company or clerk
of court for the purpose of obtaining indemnity or stay of judicial proceedings;

     (7) any Lien upon property or assets acquired or sold by an Issuer or any Restricted
Subsidiary resulting from the exercise of any rights arising out of defaults on receivables;

4

 

     (8) any Lien incurred in the ordinary course of business in connection with worker’s
compensation, unemployment insurance, temporary disability, social security, retiree health
or similar laws or regulations or to secure obligations imposed by statute or governmental
regulations;

     (9) any Lien in favor of an Issuer or any Restricted Subsidiary;

     (10) any Lien in favor of the United States of America or any state thereof, or any
department, agency or instrumentality or political subdivision of the United States of
America or any state thereof, to secure partial, progress, advance, or other payments
pursuant to any contract or statute, or any Debt incurred by an Issuer or any Restricted
Subsidiary for the purpose of financing all or any part of the purchase price of, or the
cost of constructing, developing, repairing or improving, the property or assets subject to
such Lien;

     (11) any Lien securing industrial development, pollution control or similar revenue
bonds;

     (12) any Lien securing Debt of an Issuer or any Restricted Subsidiary, all or a portion
of the net proceeds of which are used, substantially concurrently with the funding thereof
(and for purposes of determining such “substantial concurrence,” taking into consideration,
among other things, required notices to be given to Holders of Outstanding Debt Securities
(including the Notes) in connection with such refunding, refinancing or repurchase, and the
required corresponding durations thereof), to refinance, refund or repurchase all
Outstanding Debt Securities (including the Notes), including the amount of all accrued
interest thereon and reasonable fees and expenses and premium, if any, incurred by the
Issuers or any Restricted Subsidiary in connection therewith;

     (13) Liens in favor of any Person to secure obligations under the provisions of any
letters of credit, bank guarantees, bonds or surety obligations required or requested by any
governmental authority in connection with any contract or statute;

     (14) any Lien upon or deposits of any assets to secure performance of bids, trade
contracts, leases or statutory obligations;

     (15) any Lien or privilege vested in any grantor, lessor or licensor or permittor for
rent or other charges due or for any other obligations or acts to be performed, the payment
of which rent or other charges or performance of which other obligations or acts is required
under leases, easements, rights-of-way, licenses, franchises, privileges, grants or permits,
so long as payment of such rent or the performance of such other obligations or acts is not
delinquent or the requirement for such payment or performance is being contested in good
faith by appropriate proceedings;

     (16) easements, exceptions or reservations in any property of the Partnership or any of
the Restricted Subsidiaries granted or reserved for the purpose of pipelines, roads,
the removal of oil, gas, coal or other minerals, and other like purposes for the joint
or common use of real property, facilities and equipment, which are incidental to, and do

5

 

not materially interfere with, the ordinary conduct of its business or the business of the
Partnership and its Subsidiaries, taken as a whole;

     (17) Liens arising under operating agreements, joint venture agreements, partnership
agreements, oil and gas leases, farmout agreements, division orders, contracts for sale,
transportation or exchange of oil and natural gas, unitization and pooling declarations and
agreements, area of mutual interest agreements and other agreements arising in the ordinary
course of the Partnership’s or any Restricted Subsidiary’s business that are customary in
the business of marketing, transportation and terminalling of crude oil and/or marketing of
liquefied petroleum gas; or

     (18) any obligations or duties to any municipality or public authority with respect to
any lease, easement, right-of-way, license, franchise, privilege, permit or grant.

          “Principal Property” means, whether owned or leased on the Issue Date or thereafter acquired:
(1) any of the pipeline assets of the Partnership or the pipeline assets of any Subsidiary of the
Partnership, including any related facilities employed in the transportation, distribution,
terminalling, gathering, treating, processing, marketing or storage of crude oil or refined
petroleum products, natural gas, natural gas liquids, fuel additives or petrochemicals, and (2) any
processing or manufacturing plant or terminal owned or leased by the Partnership or any Subsidiary
of the Partnership; except, in the case of either clause (1) or (2), (a) any such assets consisting
of inventories, furniture, office fixtures and equipment, including data processing equipment,
vehicles and equipment used on, or useful with, vehicles, and (b) any such assets, plant or
terminal which, in the good faith opinion of the Board of Directors, is not material in relation to
the activities of the Partnership or the activities of the Partnership and its Subsidiaries, taken
as a whole.

          “Restricted Subsidiary” means any Subsidiary of the Partnership owning or leasing, directly or
indirectly through ownership in another Subsidiary, any Principal Property.

          “Sale-leaseback Transaction” means the sale or transfer by an Issuer or any Subsidiary of the
Partnership of any Principal Property to a Person (other than an Issuer or a Subsidiary of the
Partnership) and the taking back by an Issuer or any Subsidiary of the Partnership, as the case may
be, of a lease of such Principal Property.

          “Subsidiary” means, with respect to any Person: (1) any other Person of which more than 50% of
the total voting power of shares or other Capital Interests entitled, without regard to the
occurrence of any contingency, to vote in the election of directors, managers or trustees (or
equivalent persons) thereof is at the time owned or controlled, directly or indirectly, by such
Person or one or more of the other Subsidiaries of such Person or a combination thereof; or (2) in
the case of a partnership, more than 50% of the partners’ Capital Interests, considering all
partners’ Capital Interests as a single class, is at the time owned or controlled, directly or
indirectly, by such Person or one or more of the other Subsidiaries of such Person or a combination
thereof.

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          “Subsidiary Guarantors” means each of:

     (1) the Subsidiaries of the Partnership named as the “Subsidiary Guarantors” on the
signature pages of this Supplemental Indenture;

     (2) any other Subsidiary that executes a supplemental Indenture to provide a Guarantee
in accordance with the provisions of the Indenture; and

     (3) their respective successors and assigns.

Notwithstanding anything in the Indenture to the contrary, CDM Max, LLC, Nexen Marketing U.S.A.
Inc., Nexen Pipeline U.S.A. LLC, PAA Finance, PAA Luxembourg S.a.r.l., PAA Midstream LLC, PAA
Midstream Luxembourg S.a.r.l., PAA Natural Gas Storage, L.P. and its Subsidiaries, PAA/Vulcan Gas
Storage, LLC, Pacific Pipeline System LLC, Pacific Energy Management LLC, Pacific Energy GP, LP,
Plains Marketing Bondholder, LLC, Plains West Coast Terminals LLC, PNGS GP LLC, SLC Pipeline LLC
and Southcap Pipeline Company shall not be Subsidiary Guarantors.

          Section 2.02. Other Definitions.

	 	 	 	 	 
	 	 	Defined in
	Term	 	Section
	 
	 	 	 	 
	“Additional Notes”
	 	 	3.02	 
	“Covenant Defeasance”
	 	 	8.03	 
	“Event of Default”
	 	 	7.01	 
	“Legal Defeasance”
	 	 	8.02	 
	“Note Obligations”
	 	 	9.01	 
	“Payment Default
	 	 	7.01	 
	“Required Filing Dates”
	 	 	5.04	 
	“Successor Company”
	 	 	6.01	 

ARTICLE III

THE NOTES

          Section 3.01. Form. The Notes shall be issued initially in the form of one or more Global Securities. The Notes and
Trustee’s certificate of authentication shall be substantially in the form of Exhibit A hereto, the
terms of which are incorporated in and made a part of this Supplemental Indenture, and the Issuers
and the Trustee, by their execution and delivery of this Supplemental Indenture, expressly agree to
such terms and provisions and to be bound thereby.

          Section 3.02. Issuance of Additional Notes. The Issuers may, from time to time, issue an unlimited amount of additional Notes (“Additional
Notes”) under the Indenture, which shall be issued in the same form as the Notes issued on the
Issue Date and which shall have identical terms as the Notes issued on the Issue Date other than
with respect to the issue date, the date of first payment of interest, if applicable, and the
payment of interest accruing prior to the

7

 

issue date. The Notes issued on the Issue Date shall be limited in aggregate principal
amount to $600,000,000. The Notes issued on the Issue Date and any Additional Notes subsequently
issued shall be treated as a single series for all purposes under the Indenture, including waivers,
amendments, redemptions and offers to purchase.

          Section 3.03. Global Security Legend. Each of the Global Securities shall bear a legend in substantially the following form:

          THIS GLOBAL SECURITY IS HELD BY OR ON BEHALF OF THE DEPOSITARY (AS DEFINED IN THE INDENTURE
GOVERNING THIS NOTE) IN CUSTODY FOR THE BENEFIT OF THE BENEFICIAL OWNERS HEREOF, AND IS NOT
TRANSFERABLE TO ANY PERSON UNDER ANY CIRCUMSTANCES EXCEPT THAT (A) THE TRUSTEE MAY MAKE SUCH
NOTATIONS HEREON AS MAY BE REQUIRED PURSUANT TO SECTION 2.08 OF THE ORIGINAL INDENTURE, (B) THIS
GLOBAL SECURITY MAY BE EXCHANGED IN WHOLE BUT NOT IN PART PURSUANT TO SECTION 2.15 OF THE ORIGINAL
INDENTURE, (C) THIS GLOBAL SECURITY MAY BE DELIVERED TO THE TRUSTEE FOR CANCELLATION PURSUANT TO
SECTION 2.10 OF THE ORIGINAL INDENTURE AND (D) THIS GLOBAL SECURITY MAY BE TRANSFERRED TO A
SUCCESSOR DEPOSITARY OR ITS NOMINEE WITH THE PRIOR WRITTEN CONSENT OF THE ISSUERS.

ARTICLE IV

REDEMPTION AND PREPAYMENT

          Section 4.01. Optional Redemption.

          (a) At their option at any time prior to maturity, the Issuers may choose to redeem all or any
portion of the Notes, at once or from time to time.

          (b) To redeem the Notes, the Issuers must pay a redemption price in an amount determined in
accordance with the provisions of paragraph number 5 of the form of Note in Exhibit A hereto, plus
accrued and unpaid interest, if any, to the redemption date (subject to the right of Holders on the
relevant record date to receive interest due on the relevant interest payment date).

          (c) Any redemption pursuant to this Section 4.01 shall otherwise be made pursuant to the
provisions of Sections 3.01 through 3.03 of the Original Indenture. The actual redemption price
shall be set forth in an Officers’ Certificate delivered to the Trustee no later than two Business
Days prior to each redemption date.

ARTICLE V

COVENANTS

          Section 5.01. Compliance Certificate. (a) In lieu of the Officers’ Certificate required by Section 4.05 of the Original Indenture,
the Issuers and Subsidiary Guarantors shall deliver to the Trustee, within 90 days after the end of
each fiscal year, an Officers’ Certificate stating that a review of the activities of the
Partnership and its Subsidiaries during the preceding

8

 

fiscal year has been made under the
supervision of the signing Officers (one of whom shall be the principal executive, financial or
accounting officer of each Issuer and Subsidiary Guarantor) with a view to determining whether the
Issuers have kept, observed, performed and fulfilled their obligations under the Indenture, and
further stating, as to each such person signing such certificate, that to the best of his or her
knowledge the Issuers have kept, observed, performed and fulfilled each and every covenant
contained in the Indenture and are not in default in the performance or observance of any of the
terms, provisions and conditions of the Indenture (or, if a Default or Event of Default shall have
occurred, describing all such Defaults or Events of Default of which he or she may have knowledge
and what action the Issuers are taking or propose to take with respect thereto).

          (b) The Issuers shall, so long as any of the Notes are outstanding, deliver to the Trustee,
forthwith and in any event within five days upon any officer of an Issuer becoming aware of any
Default or Event of Default or an event which, with notice or the lapse of time or both, would
constitute an Event of Default, an Officers’ Certificate specifying such Default or Event of
Default and what action the Issuers are taking or propose to take with respect thereto.

          Section 5.02. Limitations on Liens. The Issuers will not, nor will they permit any Subsidiary of the Partnership to, create, assume,
incur or suffer to exist any Lien upon any Principal Property or upon any Capital Interests of any
Restricted Subsidiary, whether owned or leased on the Issue Date or thereafter acquired, to secure
any Debt of an Issuer or any other Person (other than Debt Securities), without in any such case
making effective provision whereby all of the Notes shall be secured equally and ratably with, or
prior to, such Debt so long as such Debt shall be so secured. This restriction shall not apply to:

          (a) Permitted Liens;

          (b) any Lien upon any property or assets created at the time of acquisition of such property
or assets by an Issuer or any Restricted Subsidiary or within one year after such time to secure
all or a portion of the purchase price for such property or assets or Debt incurred to finance such
purchase price, whether such Debt was incurred prior to, at the time of or within one year after
the date of such acquisition;

          (c) any Lien upon any property or assets to secure all or part of the cost of construction,
development, repair or improvements thereon or to secure Debt incurred prior to, at the time of, or
within one year after completion of such construction, development, repair or improvements or the
commencement of full operations thereof (whichever is later), to provide funds for any such
purpose;

          (d) any Lien upon any property or assets existing thereon at the time of the acquisition
thereof by an Issuer or any Restricted Subsidiary (whether or not the obligations
secured thereby are assumed by an Issuer or any Restricted Subsidiary); provided, however,
that such Lien only encumbers the property or assets so acquired;

          (e) any Lien upon any property or assets of a Person existing thereon at the time such Person
becomes a Restricted Subsidiary by acquisition, merger or otherwise; provided,

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however, that such
Lien only encumbers the property or assets of such Person at the time such Person becomes a
Restricted Subsidiary;

          (f) any Lien upon any property or assets of an Issuer or any Restricted Subsidiary in
existence on December 10, 2003 or provided for pursuant to agreements existing on December 10,
2003;

          (g) Liens imposed by law or order as a result of any proceeding before any court or regulatory
body that is being contested in good faith, and Liens which secure a judgment or other
court-ordered award or settlement as to which an Issuer or the applicable Restricted Subsidiary, as
the case may be, has not exhausted its appellate rights;

          (h) any extension, renewal, refinancing, refunding or replacement (or successive extensions,
renewals, refinancings, refundings or replacements) of Liens, in whole or in part, referred to in
clauses (a) through (g), inclusive, of this Section 5.02; provided, however, that any such
extension, renewal, refinancing, refunding or replacement Lien shall be limited to the property or
assets covered by the Lien extended, renewed, refinanced, refunded or replaced and that the
obligations secured by any such extension, renewal, refinancing, refunding or replacement Lien
shall be in an amount not greater than the amount of the obligations secured by the Lien extended,
renewed, refinanced, refunded or replaced and any expenses of the Issuers and the Restricted
Subsidiaries (including any premium) incurred in connection with such extension, renewal,
refinancing, refunding or replacement; or

          (i) any Lien resulting from the deposit of moneys or evidence of indebtedness in trust for the
purpose of defeasing Debt of an Issuer or any Restricted Subsidiary.

          Notwithstanding the foregoing provisions of this Section 5.02, the Issuers may, and may permit
any Restricted Subsidiary to, create, assume, incur or suffer to exist any Lien upon any Principal
Property or Capital Interests of a Restricted Subsidiary to secure Debt of an Issuer or any Person
(other than Debt Securities) that is not excepted by clauses (a) through (i), inclusive, of this
Section 5.02 without securing the Notes, provided that the aggregate principal amount of all Debt
then outstanding secured by such Lien and all other Liens not excepted by clauses (a) through (i),
inclusive, of this Section 5.02, together with all Attributable Indebtedness from Sale-leaseback
Transactions (excluding Sale-leaseback Transactions permitted by clauses (a) through (d),
inclusive, of Section 5.03), does not exceed 10% of Consolidated Net Tangible Assets.

          Section 5.03. Restriction of Sale-leaseback Transactions. The Issuers will not, and will not permit any Subsidiary of the Partnership to, engage in a
Sale-leaseback Transaction, unless:

          (a) such Sale-leaseback Transaction occurs within one year from the date of completion of the
acquisition of the Principal Property subject thereto or the date of the completion of
construction, development or substantial repair or improvement, or commencement of full operations
on such Principal Property, whichever is later;

10

 

          (b) the Sale-leaseback Transaction involves a lease for a period, including renewals, of not
more than three years;

          (c) the Attributable Indebtedness from that Sale-leaseback Transaction is an amount equal to
or less than the amount the Issuers or such Subsidiary would be allowed to incur as Debt secured by
a Lien on the Principal Property subject thereto without equally and ratably securing the Notes
under Section 5.02; or

          (d) the Issuers or such Subsidiary, within a one-year period after such Sale-leaseback
Transaction, applies or causes to be applied an amount not less than the net sale proceeds from
such Sale-leaseback Transaction to (A) the prepayment, repayment, redemption, reduction or
retirement of any Pari Passu Debt of an Issuer or any Subsidiary of the Partnership, or (B) the
expenditure or expenditures for Principal Property used or to be used in the ordinary course of
business of the Partnership or its Subsidiaries.

          Notwithstanding the foregoing provisions of this Section 5.03, the Issuers may, and may permit
any Subsidiary of the Partnership to, effect any Sale-leaseback Transaction that is not excepted by
clauses (a) through (d), inclusive, of this Section 5.03, provided that the Attributable
Indebtedness from such Sale-leaseback Transaction, together with the aggregate principal amount of
then outstanding Debt (other than Debt Securities) secured by Liens upon Principal Properties not
excepted by clauses (a) through (i), inclusive, of Section 5.02, does not exceed 10% of
Consolidated Net Tangible Assets.

          Section 5.04. SEC Reports; Financial Statements.

          (a) Whether or not the Partnership is then subject to the reporting requirements of Section 13
or 15(d) of the Exchange Act, the Partnership shall electronically file with the Commission, so
long as the Notes are Outstanding, the annual, quarterly and other periodic reports that the
Partnership is required to file (or would otherwise be required to file) with the Commission
pursuant to Sections 13 and 15(d) of the Exchange Act, and such documents shall be filed with the
Commission on or prior to the respective dates (the “Required Filing Dates”) by which the
Partnership is required to file (or would otherwise be required to file) such documents, unless, in
each case, such filings are not then permitted by the Commission.

          (b) If such filings are not then permitted by the Commission, or such filings are not
generally available on the Internet free of charge, the Issuers shall provide the Trustee with, and
the Trustee will mail to any Holder of Notes requesting in writing to the Trustee copies of, such
annual, quarterly and other periodic reports specified in Sections 13 and 15(d) of the Exchange Act
within 15 days after the respective Required Filing Dates.

          (c) [Intentionally omitted.]

          (d) The Partnership shall provide the Trustee with a sufficient number of copies of all
reports and other documents and information that the Trustee may be required to deliver to Holders
of Notes under clause (b) of this Section 5.04.

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          (e) Delivery of such reports, information and documents to the Trustee is for informational
purposes only and the Trustee’s receipt of such shall not constitute constructive notice of any
information contained therein or determinable from information contained therein, including the
Partnership’s compliance with any of its covenants hereunder (as to which the Trustee is entitled
to rely exclusively on Officers’ Certificates).

          Section 5.05. Additional Subsidiary Guarantees. If any Subsidiary (or its successor) of the Partnership that is not then a Subsidiary Guarantor
guarantees Debt of either of the Issuers or any other Subsidiary of the Partnership, in either case
after the Issue Date, then such Subsidiary (or successor) shall execute and deliver a supplemental
Indenture providing for the guarantee of the payment of the Notes pursuant to Article IX hereof.

ARTICLE VI

SUCCESSORS

          With respect to the Notes, the provisions of this Article VI shall preempt the provisions of
Article X of the Original Indenture in their entirety.

          Section 6.01. Consolidation and Mergers of the Issuers. Neither Issuer shall consolidate or amalgamate with or merge with or into any Person, or sell,
convey, transfer, lease or otherwise dispose of all or substantially all its assets to any Person,
whether in a single transaction or a series of related transactions, except (1) in accordance with
the provisions of the Partnership Agreement, and (2) unless: (a) either (i) such Issuer shall be
the surviving Person in the case of a merger or (ii) the resulting, surviving or transferee Person
if other than such Issuer (the “Successor Company”) shall be a partnership, limited liability
company or corporation organized and existing under the laws of the United States, any state
thereof or the District of Columbia (provided that PAA Finance may not merge, amalgamate or
consolidate with or into another Person other than a corporation satisfying such requirement for so
long as the Partnership is not a corporation) and the Successor Company shall expressly assume, by
an indenture supplemental hereto, executed and delivered to the Trustee, in form reasonably
satisfactory to the Trustee, the due and punctual payment of the principal of, premium, if any, and
interest on all of the Notes, and the due and punctual performance or observance of all the other
obligations under the Indenture to be performed or observed by such Issuer; (b) immediately after
giving effect to such transaction or series of transactions, no Default or Event of Default would
occur or be continuing; (c) if such Issuer is not the continuing Person, then each Subsidiary
Guarantor, unless it has become the Successor Company, shall confirm that its Guarantee shall
continue to apply to the obligations under the Notes and the Indenture; and (d) such Issuer shall
have delivered to the Trustee an Officers’ Certificate and an Opinion of
Counsel, each stating that such consolidation, amalgamation, merger, sale, conveyance, transfer,
lease or other disposition and such supplemental Indenture (if any) comply with this Section 6.01
and any other applicable provisions of the Indenture.

          Section 6.02. Rights and Duties of Successor. In case of any consolidation, amalgamation or merger where an Issuer is not the continuing
Person, or disposition of all or substantially all of the assets of an Issuer in accordance with
Section 6.01, the Successor Company shall succeed to and be substituted for such Issuer with the
same effect as if it had been named herein as the respective party to the Indenture, and the
predecessor entity shall be

12

 

released from all liabilities and obligations under the Indenture and
the Notes, except that no such release will occur in the case of a lease of all or substantially
all of an Issuer’s assets. In case of any such consolidation, amalgamation, merger, sale,
conveyance, transfer, lease or other disposition, such changes in phraseology and form (but not in
substance) may be made in the Notes thereafter to be issued as may be appropriate.

          Section 6.03. Supplemental Indenture. Section 9.01 of the Original Indenture is hereby amended, with respect to the Notes, by adding
the words “or the confirmation of a Subsidiary Guarantor’s” immediately after the word “Issuer’s”
in Section 9.01(c).

ARTICLE VII

DEFAULTS AND REMEDIES

          Section 7.01. Events of Default. With respect to the Notes, the provisions of this Section 7.01 shall preempt the provisions of
the first and final paragraphs of Section 6.01 of the Original Indenture in their entirety.

          (a) An “Event of Default” occurs if:

     (i) the Issuers default for 60 days in the payment when due of interest on the
Notes;

     (ii) the Issuers default in the payment when due of principal of or premium, if
any, on the Notes at maturity, upon redemption or otherwise;

     (iii) failure by an Issuer or any Subsidiary Guarantor for 90 days after
receipt of notice by the Issuers from the Trustee or to the Issuers and the Trustee
by the Holders of at least 25% in principal amount of the Notes then Outstanding to
comply with any other term, covenant or warranty in the Indenture or the Notes
(provided that notice need not be given, and an Event of Default shall
occur, 90 days after any breach of the provisions of Section 6.01 hereof);

     (iv) default under any mortgage, indenture or instrument under which there may
be issued or by which there may be secured or evidenced any Debt of
an Issuer or any of the Partnership’s Subsidiaries (or the payment of which is
guaranteed by the Partnership or any of its Subsidiaries), whether such Debt or
guarantee now exists or is created after the Issue Date, if that default (A) is
caused by a failure to pay principal of or premium, if any, or interest on such Debt
prior to the expiration of the grace period provided in such Debt (a “Payment
Default”) or (B) results in the acceleration of the maturity of such Debt to a date
prior to its originally stated maturity, and, in each case described in clause (A)
or (B), the principal amount of any such Debt, together with the principal amount of
any other such Debt under which there has been a Payment Default or the maturity of
which has been so accelerated, aggregates $25.0 million or more; provided,
further, that if any such default is cured or waived or any such
acceleration rescinded, or such Debt is repaid, within a period of 30 days from the
continuation of such default beyond the applicable grace period or the occurrence

13

 

of
such acceleration, as the case may be, such Event of Default and any consequential
acceleration of the Notes shall be automatically rescinded, so long as such
rescission does not conflict with any judgment or decree;

     (v) except as permitted by the Indenture, any Guarantee shall cease for any
reason to be in full force and effect (except as otherwise provided in the
Indenture) or is declared null and void in a judicial proceeding or any Subsidiary
Guarantor, or any Person acting on behalf of any Subsidiary Guarantor, shall deny or
disaffirm its obligations under the Indenture or its Guarantee;

     (vi) an Issuer or any Subsidiary Guarantor pursuant to or within the meaning of
any Bankruptcy Law:

     (A) commences a voluntary case,

     (B) consents to the entry of an order for relief against it in an
involuntary case,

     (C) consents to the appointment of a custodian of it or for all or
substantially all of its property,

     (D) makes a general assignment for the benefit of its creditors, or

     (E) generally is not paying its debts as they become due; or

     (vii) a court of competent jurisdiction enters an order or decree under any
Bankruptcy Law that:

     (A) is for relief against an Issuer or any Subsidiary Guarantor in an
involuntary case;

     (B) appoints a custodian of an Issuer or any Subsidiary Guarantor or
for all or substantially all of the property of an Issuer or any
Subsidiary Guarantor; or

     (C) orders the liquidation of an Issuer or any Subsidiary Guarantor;

and the order or decree remains unstayed and in effect for 60 consecutive days.

          (b) In the case of an Event of Default arising from Section 7.01(a)(vi) or 7.01(a)(vii) hereof
involving an Issuer (and, for the avoidance of doubt, excluding any such Event of Default that
involves only one or more Subsidiary Guarantors), the principal amount of all Outstanding Notes and
interest thereon shall become due and payable immediately without further action or notice. If any
other Event of Default occurs and is continuing, the Trustee or the Holders of at least 25% in
principal amount of the then Outstanding Notes may declare the principal amount of all the Notes
and interest thereon to be due and payable immediately by a

14

 

notice in writing to the Issuers (and
to the Trustee if given by the Holders) and upon any such declaration such principal amount and
interest thereon shall be due and payable immediately.

ARTICLE VIII

LEGAL DEFEASANCE AND COVENANT DEFEASANCE

          Section 8.01. Option to Effect Legal Defeasance or Covenant Defeasance. The Issuers may, at the option of the Boards of Directors evidenced by a Board Resolution set
forth in an Officers’ Certificate, at any time, elect to have either Section 8.02 or 8.03 hereof be
applied to all outstanding Notes and Guarantees upon compliance with the conditions set forth below
in this Article VIII.

          Section 8.02. Legal Defeasance and Discharge. Upon the Issuers’ exercise under Section 8.01 hereof of the option applicable to this Section
8.02, each of the Issuers and the Subsidiary Guarantors shall, subject to the satisfaction of the
conditions set forth in Section 8.04 hereof, be deemed to have been discharged from its obligations
with respect to all outstanding Notes and Guarantees on the date the conditions set forth below are
satisfied (hereinafter, “Legal Defeasance”). For this purpose, Legal Defeasance means that each of
the Issuers shall be deemed to have paid and discharged the entire Debt represented by the
outstanding Notes, which shall thereafter be deemed to be “Outstanding” only for the purposes of
Section 8.05 hereof and the other Sections of the Indenture referred to in (a) and (b) below, and
to have satisfied all its other obligations under such Notes and the Indenture, and each of the
Subsidiary Guarantors shall be deemed to have discharged its obligations under its Guarantee (and
the Trustee, on demand of and at the expense of the Issuers, shall execute proper instruments
acknowledging the same), except for the following provisions which shall survive until otherwise
terminated or discharged hereunder:

          (a) the rights of Holders of Outstanding Notes to receive solely from the trust fund described
in Section 8.04 hereof, and as more fully set forth in such Section, payments in respect of the
principal of, premium on, if any, and interest on such Notes when such payments are due,

          (b) the Issuers’ obligations with respect to such Notes under Sections 2.07, 2.08, 2.09 and
4.02 of the Original Indenture,

          (c) the rights, powers, trusts, duties and immunities of the Trustee hereunder and the
Issuers’ obligations in connection therewith,

          (d) this Article VIII, and

          (e) the Issuers’ rights of optional redemption under Section 4.01 hereof.

Subject to compliance with this Article VIII, the Issuers may exercise their option under this
Section 8.02 notwithstanding the prior exercise of their option under Section 8.03 hereof.

          Section 8.03. Covenant Defeasance. Upon the Issuers’ exercise under Section 8.01 hereof of the option applicable to this Section
8.03, each of the Issuers shall, subject to the

15

 

satisfaction of the conditions set forth in Section
8.04 hereof, be released from its obligations under the covenants contained in Sections 5.02, 5.03,
5.04 and 5.05 hereof with respect to the Outstanding Notes on and after the date the conditions set
forth in Section 8.04 are satisfied (hereinafter, “Covenant Defeasance”), and the Notes shall
thereafter be deemed not “Outstanding” for the purposes of any direction, waiver, consent or
declaration or act of Holders (and the consequences of any thereof) in connection with such
covenants, but shall continue to be deemed “Outstanding” for all other purposes hereunder (it being
understood that such Notes shall not be deemed outstanding for accounting purposes). For this
purpose, Covenant Defeasance means that, with respect to the Outstanding Notes, the Issuers may
omit to comply with and shall have no liability in respect of any term, condition or limitation set
forth in any such covenant, whether directly or indirectly, by reason of any reference elsewhere
herein to any such covenant or by reason of any reference in any such covenant to any other
provision herein or in any other document and such omission to comply shall not constitute a
Default or an Event of Default under Section 7.01 hereof, but, except as specified above, the
remainder of the Indenture, the Guarantees and such Notes shall be unaffected thereby.

          Section 8.04. Conditions to Legal or Covenant Defeasance. The following shall be the conditions to the application of either Section 8.02 or 8.03 hereof
to the Outstanding Notes:

          In order to exercise either Legal Defeasance or Covenant Defeasance:

          (a) the Issuers must irrevocably deposit with the Trustee, in trust, for the benefit of the
Holders of the Notes, cash in Dollars, U.S. Government Obligations, or a combination thereof, in
such amounts as shall be sufficient, in the written opinion of a nationally recognized firm of
independent public accountants, to pay the principal of, premium on, if any, and interest on the
Outstanding Notes at the Stated Maturity thereof or on the applicable redemption date, as the case
may be, and the Issuers must specify whether the Notes are being defeased to maturity or to a
particular redemption date;

          (b) in the case of an election under Section 8.02 hereof, the Issuers shall have delivered to
the Trustee an Opinion of Counsel confirming that (i) the Issuers have received from, or there has
been published by, the Internal Revenue Service a ruling or (ii) since the date of the Indenture,
there has been a change in the applicable federal income tax law, in either case to the effect
that, and based thereon such Opinion of Counsel shall confirm that, the Holders of the Outstanding
Notes shall not recognize income, gain or loss for federal income tax purposes as a result of such
Legal Defeasance and shall be subject to federal income tax on the same amounts, in the same manner
and at the same times as would have been the case if such Legal Defeasance had not occurred;

          (c) in the case of an election under Section 8.03 hereof, the Issuers shall have delivered to
the Trustee an Opinion of Counsel confirming that the Holders of the Outstanding Notes shall not
recognize income, gain or loss for federal income tax purposes as a result of such Covenant
Defeasance and shall be subject to federal income tax on the same amounts, in the same manner and
at the same times as would have been the case if such Covenant Defeasance had not occurred;

16

 

          (d) no Default or Event of Default shall have occurred and be continuing either (i) on the
date of such deposit (other than a Default or Event of Default resulting from the incurrence of
Debt all or a portion of the proceeds of which shall be applied to such deposit) or (ii) insofar as
Section 7.01(a)(vi) or 7.01(a)(vii) hereof is concerned, at any time in the period ending on the
91st day after the date of deposit;

          (e) such Legal Defeasance or Covenant Defeasance shall not result in a breach or violation of,
or constitute a default under, any agreement or instrument (other than the Notes and the Indenture)
to which the Partnership or any of its Subsidiaries is a party or by which the Partnership or any
of its Subsidiaries is bound;

          (f) the Issuers shall have delivered to the Trustee an Opinion of Counsel to the effect that
after the 91st day following the deposit, the trust funds shall not be subject to the effect of any
applicable bankruptcy, insolvency, reorganization or similar laws affecting creditors’ rights
generally;

          (g) the Issuers shall have delivered to the Trustee an Officers’ Certificate stating that the
deposit was not made by the Issuers with the intent of preferring the Holders over any other
creditors of the Issuers or with the intent of defeating, hindering, delaying or defrauding any
other creditors of the Issuers; and

          (h) the Issuers shall have delivered to the Trustee an Officers’ Certificate and an Opinion of
Counsel, each stating that all conditions precedent provided for or relating to the Legal
Defeasance or the Covenant Defeasance have been complied with.

          Section 8.05. Deposited Money and U.S. Government Obligations to be Held in Trust; Other
Miscellaneous Provisions. Subject to Section 8.06 hereof, all money and U.S. Government Obligations (including the
proceeds thereof) deposited with the Trustee (or other qualifying trustee, collectively for
purposes of this Section 8.05, the “Trustee”) pursuant to Section 8.04 hereof in respect of the
outstanding Notes shall be held in trust and applied by the Trustee, in accordance with the
provisions of such Notes and the Indenture, to the payment, either directly or through any paying
agent (including an Issuer acting as paying agent) as the Trustee may determine, to the Holders of
such Notes of all sums due and to become due thereon in respect of principal, premium, if any, and
interest, but such money need not be segregated from other funds except to the extent required by
law.

          The Issuers shall pay and indemnify the Trustee against any tax, fee or other charge imposed
on or assessed against the cash or U.S. Government Obligations deposited pursuant to Section 8.04
hereof or the principal and interest received in respect thereof other than any such tax, fee or
other charge which by law is for the account of the Holders of the Outstanding Notes.

          Anything in this Article VIII to the contrary notwithstanding, the Trustee shall deliver or
pay to the Issuers from time to time upon the written request of the Issuers any money or U.S.
Government Obligations held by it as provided in Section 8.04 hereof which, in the opinion of a
nationally recognized firm of independent public accountants expressed in a written certification
thereof delivered to the Trustee (which may be the opinion delivered under

17

 

Section 8.04(a) hereof),
are in excess of the amount thereof that would then be required to be deposited to effect an
equivalent Legal Defeasance or Covenant Defeasance.

          Section 8.06. Repayment to Issuers. Any money deposited with the Trustee or any paying agent, or then held by the Issuers, in trust
for the payment of the principal of, premium on, if any, or interest on any Note and remaining
unclaimed for two years after such principal, premium, if any, or interest has become due and
payable shall be paid to the Issuers on their written request or (if then held by the Issuers)
shall be discharged from such trust; and the Holder of such Note shall thereafter, as an unsecured
creditor, look only to the Issuers for payment thereof, and all liability of the Trustee or such
paying agent with respect to such trust money, and all liability of the Issuers as trustee thereof,
shall thereupon cease; provided, however, that the Trustee or such paying agent,
before being required to make any such repayment, may at the expense of the Issuers cause to be
published once, in the New York Times and The Wall Street Journal (national edition), notice that
such money remains unclaimed and that, after a date specified therein, which shall not be less than
30 days from the date of such notification or publication, any unclaimed balance of such money then
remaining shall be repaid to the Issuers.

          Section 8.07. Reinstatement. If the Trustee or paying agent is unable to apply any Dollars or U.S. Government Obligations in
accordance with Section 8.02 or 8.03 hereof, as the case may be, by reason of any order or judgment
of any court or governmental authority enjoining, restraining or otherwise prohibiting such
application, then the Issuers’ obligations under the Indenture and the Notes and the
Subsidiary Guarantors’ obligations under the Guarantees shall be revived and reinstated as though
no deposit had occurred pursuant to Section 8.02 or 8.03 hereof until such time as the Trustee or
paying agent is permitted to apply all such money in accordance with Section 8.02 or 8.03 hereof,
as the case may be; provided, however, that, if the Issuers make any payment of
principal of, premium on, if any, or interest on any Note following the reinstatement of their
obligations, the Issuers shall be subrogated to the rights of the Holders of such Notes to receive
such payment from the money held by the Trustee or paying agent.

ARTICLE IX

SUBSIDIARY GUARANTEES

          Section 9.01. Subsidiary Guarantees. (a) Each Subsidiary Guarantor hereby jointly and severally unconditionally and irrevocably
guarantees on a senior basis to each Holder and to the Trustee and its successors and assigns (i)
the full and punctual payment of principal, premium, if any, and interest with respect to, the
Notes when due, whether at maturity, by acceleration, by redemption or otherwise, and all other
monetary obligations of the Issuers under the Indenture (including obligations to the Trustee) and
the Notes and (ii) the full and punctual performance within applicable grace periods of all other
obligations of the Issuers under the Indenture and the Notes (all the foregoing being hereinafter
collectively called the “Note Obligations”). Each Subsidiary Guarantor further agrees that the
Note Obligations may be extended or renewed, in whole or in part, without notice or further assent
from each such Subsidiary Guarantor, and that each such Subsidiary Guarantor shall remain bound
under this Article IX notwithstanding any extension or renewal of any Note Obligation.

18

 

          (b) Each Subsidiary Guarantor waives presentation to, demand of, payment from and protest to
the Issuers of any of the Note Obligations and also waives notice of protest for nonpayment. Each
Subsidiary Guarantor waives notice of any Default or Event of Default under the Notes or the Note
Obligations. The obligations of each Subsidiary Guarantor hereunder shall not be affected by (i)
the failure of any Holder or the Trustee to assert any claim or demand or to enforce any right or
remedy against the Issuers or any other Person under the Indenture, the Notes or any other
agreement or otherwise; (ii) any extension or renewal of any thereof; (iii) any rescission, waiver,
amendment or modification of any of the terms or provisions of the Indenture, the Notes or any
other agreement; (iv) the release of any security held by any Holder or the Trustee for the Note
Obligations or any of them; (v) the failure of any Holder or Trustee to exercise any right or
remedy against any other guarantor of the Note Obligations; or (vi) any change in the ownership of
such Subsidiary Guarantor, except as provided in Section 9.02 hereof.

          (c) Each Subsidiary Guarantor further agrees that its Guarantee herein constitutes a guarantee
of payment, performance and compliance when due (and not a guarantee of collection) and waives any
right to require that any resort be had by any Holder or the Trustee to any security held for
payment of the Note Obligations.

          (d) The obligations of each Subsidiary Guarantor hereunder shall not be subject to any
reduction, limitation, impairment or termination for any reason other than indefeasible payment in
full of the Note Obligations, including any claim of waiver, release, surrender, alteration or
compromise, and shall not be subject to any defense of setoff, counterclaim, recoupment or
termination whatsoever or by reason of the invalidity, illegality or unenforceability of the Note
Obligations or otherwise. Without limiting the generality of the foregoing, the obligations of
each Subsidiary Guarantor herein shall not be discharged or impaired or otherwise affected by the
failure of any Holder or the Trustee to assert any claim or demand or to enforce any remedy under
the Indenture, the Notes or any other agreement, by any waiver or modification of any thereof, by
any default, failure or delay, willful or otherwise, in the performance of the obligations, or by
any other act or thing or omission or delay to do any other act or thing which may or might in any
manner or to any extent vary the risk of any Subsidiary Guarantor or would otherwise operate as a
discharge of any Subsidiary Guarantor as a matter of law or equity.

          (e) Each Subsidiary Guarantor further agrees that its Guarantee herein shall continue to be
effective or be reinstated, as the case may be, if at any time payment, or any part thereof, of
principal, premium, if any, or interest with respect to any Note Obligation is rescinded or must
otherwise be restored by any Holder or the Trustee upon the bankruptcy or reorganization of either
of the Issuers or otherwise.

          (f) In furtherance of the foregoing and not in limitation of any other right which any Holder
or the Trustee has at law or in equity against any Subsidiary Guarantor by virtue hereof, upon the
failure of the Issuers to pay the principal, premium, if any, or interest with respect to any Note
Obligation when and as the same shall become due, whether at maturity, by acceleration, by
redemption or otherwise, or to perform or comply with any other Note Obligation, each Subsidiary
Guarantor hereby promises to and shall forthwith pay, or cause

19

 

to be paid, in cash, to the Holders
or the Trustee an amount equal to the sum of (i) the unpaid principal amount of such Note
Obligations, (ii) accrued and unpaid interest on such Note Obligations (but only to the extent not
prohibited by law) and (iii) all other monetary Note Obligations of the Issuers to the Holders and
the Trustee.

          (g) Each Subsidiary Guarantor agrees that it shall not be entitled to any right of subrogation
in relation to the Holders in respect of any Note Obligations guaranteed hereby until payment in
full of all Note Obligations. Each Subsidiary Guarantor further agrees that, as between it, on the
one hand, and the Holders and the Trustee, on the other hand, (i) the maturity of the Note
Obligations guaranteed hereby may be accelerated as provided in Article VII hereof for the purposes
of any Subsidiary Guarantor’s Guarantee herein, notwithstanding any stay, injunction or other
prohibition preventing such acceleration in respect of the Note Obligations guaranteed hereby, and
(ii) in the event of any declaration of acceleration of such obligations as provided in Article VII
hereof, such Note Obligations (whether or not due and payable) shall forthwith become due and
payable by such Subsidiary Guarantor for the purposes of this Section 9.01.

          (h) Each Subsidiary Guarantor also agrees to pay any and all costs and expenses (including
reasonable attorneys’ fees) incurred by the Trustee or any Holder in enforcing any rights under
this Section 9.01.

          Section 9.02. Limitation on Liability. Any term or provision of the Indenture to the contrary notwithstanding, the maximum, aggregate
amount of the Note Obligations guaranteed hereunder by any Subsidiary Guarantor shall not exceed
the maximum amount that, after giving effect to all other contingent and fixed liabilities of such
Subsidiary Guarantor and to any collections from or payments made by or on behalf of any other
Subsidiary Guarantor in respect of its obligations under its Guarantee, can be hereby guaranteed
without rendering the Indenture, as it relates to any Subsidiary Guarantor, voidable under
applicable law relating to fraudulent conveyance or fraudulent transfer.

          Section 9.03. Successors and Assigns. This Article IX shall be binding upon each Subsidiary Guarantor and, except as provided in
Section 9.07, its successors and assigns and shall inure to the benefit of the successors and
assigns of the Trustee and the Holders and, in the event of any transfer or assignment of rights by
any Holder or the Trustee, the rights and privileges conferred upon that party in the Indenture and
in the Notes shall automatically extend to and be vested in such transferee or assignee, all
subject to the terms and conditions of the Indenture.

          Section 9.04. No Waiver. Neither a failure nor a delay on the part of either the Trustee or the Holders in exercising any
right, power or privilege under this Article IX shall operate as a waiver thereof, nor shall a
single or partial exercise thereof preclude any other or further exercise of any right, power or
privilege. The rights, remedies and benefits of the Trustee and the Holders herein expressly
specified are cumulative and not exclusive of any other rights, remedies or benefits which either
may have under this Article IX at law, in equity, by statute or otherwise.

20

 

          Section 9.05. Modification. No modification, amendment or waiver of any provision of this Article IX, nor the consent to any
departure by any Subsidiary Guarantor therefrom, shall in any event be effective unless the same
shall be in writing and signed by the Trustee, and then such waiver or consent shall be effective
only in the specific instance and for the purpose for which given. No notice to or demand on any
Subsidiary Guarantor in any case shall entitle such Subsidiary Guarantor to any other or further
notice or demand in the same, similar or other circumstances.

          Section 9.06. Execution of Supplemental Indenture for Future Subsidiary Guarantors. Each Subsidiary which is required to become a Subsidiary Guarantor pursuant to Section 5.05
hereof shall promptly execute and deliver to the Trustee a supplemental Indenture in substantially
the form of Exhibit B hereto pursuant to which such Subsidiary shall become a Subsidiary
Guarantor under this Article IX and shall guarantee the Note Obligations. Concurrently with the
execution and delivery of such supplemental Indenture, the Issuers shall deliver to the Trustee an
Opinion of Counsel to the effect that such supplemental Indenture has been duly authorized,
executed and delivered by such Subsidiary and that, subject to the application of bankruptcy,
insolvency, moratorium, fraudulent conveyance or transfer and other similar laws relating to
creditors’ rights generally and to the principles of equity, whether considered in a proceeding at
law or in equity, the Guarantee of such Subsidiary Guarantor is a legal, valid and binding
obligation of such Subsidiary Guarantor, enforceable against such Subsidiary Guarantor in
accordance with its terms.

          Section 9.07. Release of Guarantee. Provided that no Default shall have occurred and shall be continuing under the Indenture, the
Guarantee of a Subsidiary Guarantor under this Article IX shall terminate and be of no further
force and effect, and such Subsidiary Guarantor shall be released from the Indenture and all Note
Obligations, upon the following events:

          (a) upon any sale or other disposition of all or substantially all of the assets of such
Subsidiary Guarantor (including by way of merger, consolidation or otherwise) to any Person that is
not an Affiliate of either of the Issuers (provided such sale or other disposition is not
prohibited by the Indenture);

          (b) upon any sale or other disposition of all of the Equity Interests of a Subsidiary
Guarantor, to any Person that is not an Affiliate of either of the Issuers; or

          (c) following the release or discharge of all guarantees by such Subsidiary Guarantor of any
Debt of the Issuers and any Subsidiary of the Partnership (other than any Debt Securities), upon
delivery by the Issuers to the Trustee of a written notice of such release or discharge from the
guarantees.

ARTICLE X

MISCELLANEOUS

          Section 10.01. Additional Amendments. With respect to the Notes, references to (A) “Section 6.01” in the Original Indenture shall be
deemed to be references to “Section 7.01 of this Supplemental Indenture; (B) “Section 11.02” in the
Original Indenture shall be deemed to be

21

 

references to “Section 8.06” of this Supplemental
Indenture; (C) “Section 6.01(g) or (h)” in the Original Indenture shall be deemed to be references
to Section 7.01(a)(vi) or (a)(vii) of this Supplemental Indenture; and (D) “Article X” in the
Original Indenture shall be deemed to be a reference to Article VI of this Supplemental Indenture.

          Section 10.02. Integral Part. This Supplemental Indenture constitutes an integral part of the Indenture.

          Section 10.03. Adoption, Ratification and Confirmation. The Original Indenture, as supplemented and amended by this Supplemental Indenture, is in all
respects hereby adopted, ratified and confirmed.

          Section 10.04. Counterparts. This Supplemental Indenture may be executed in any number of counterparts, each of which when so
executed shall be deemed an original; and all such counterparts shall together constitute but one
and the same instrument.

          Section 10.05. Governing Law. THIS SUPPLEMENTAL INDENTURE AND THE NOTES SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH
THE LAWS OF THE STATE OF NEW YORK.

[Signatures on following pages]

22

 

SIGNATURES

	 	 	 	 	 
	 	ISSUERS:

PLAINS ALL AMERICAN PIPELINE, L.P.

 	 
	 	By:  	PAA GP LLC
 	 
	 	 	its General Partner 	 
	 	 	 
	 	By:  	     PLAINS AAP, L.P.
 	 
	 	 	its Sole Member 	 
	 
	 	By:  	     PLAINS ALL AMERICAN GP LLC
 	 
	 	 	its General Partner 	 
	 	 	 
	 	By:  	
 	 
	 	 	Name:  	Al Swanson 	 
	 	 	Title:  	Senior Vice President and

Chief Financial Officer 	 
	 
	 	PAA FINANCE CORP.

 	 
	 	By:  	 	 
	 	 	Name:  	Al Swanson 	 
	 	 	Title:  	Senior Vice President and

Chief Financial Officer 	 
	 

Signature Page to Nineteenth Supplemental Indenture

1 of 8

 

	 	 	 	 	 
	 	SUBSIDIARY GUARANTORS:

PLAINS MARKETING GP INC.

 	 
	 	By:  	 	 
	 	 	Name:  	Al Swanson 	 
	 	 	Title:  	Senior Vice President and

Chief Financial Officer 	 
	 
	 	PLAINS MARKETING, L.P.

 	 
	 	By:  	PLAINS MARKETING GP INC.
 	 
	 	 	its General Partner 	 
	 	 	 
	 	By:  	
 	 
	 	 	Name:  	Al Swanson 	 
	 	 	Title:  	Senior Vice President and 
Chief
Financial Officer 	 
	 
	 	PLAINS PIPELINE, L.P.

 	 
	 	By:  	PLAINS MARKETING GP INC.
 	 
	 	 	its General Partner 	 
	 	 	 
	 	By:  	
 	 
	 	 	Name:  	Al Swanson 	 
	 	 	Title:  	Senior Vice President and 
Chief
Financial Officer 	 
	 

Signature Page to Nineteenth Supplemental Indenture

2 of 8

 

	 	 	 	 	 
	 	

PLAINS MARKETING CANADA LLC

 	 
	 	By:  	PLAINS MARKETING, L.P.
 	 
	 	 	its Sole Member 	 
	 	 	 
	 	By:  	   PLAINS MARKETING GP INC.
 	 
	 	 	its General Partner 	 
	 	 	 
	 	By:  	
 	 
	 	 	Name:  	Al Swanson 	 
	 	 	Title:  	Senior Vice President and 
Chief
Financial Officer 	 
	 
	 	PLAINS LPG SERVICES GP LLC

 	 
	 	By:  	PLAINS MARKETING, L.P.
 	 
	 	 	its Sole Member 	 
	 	 	 
	 	By:  	     PLAINS MARKETING GP INC.
 	 
	 	 	its General Partner 	 
	 	 	 
	 	By:  	
 	 
	 	 	Name:  	Al Swanson 	 
	 	 	Title:  	Senior Vice President and 
Chief
Financial Officer 	 
	 
	 	PLAINS SOUTHCAP LLC

 	 
	 	By:  	PLAINS PIPELINE, L.P.
 	 
	 	 	its Sole Member 	 
	 	 	 
	 	By:  	     PLAINS MARKETING GP INC.
 	 
	 	 	its General Partner 	 
	 	 	 
	 	By:  	
 	 
	 	 	Name:  	Al Swanson 	 
	 	 	Title:  	Senior Vice President and 
Chief
Financial Officer 	 
	 

Signature Page to Nineteenth Supplemental Indenture

3 of 8

 

	 	 	 	 	 
	 	PICSCO LLC

 	 
	 	By:  	PLAINS MARKETING, L.P.
 	 
	 	 	its Sole Member 	 
	 	 	 
	 	By:  	      PLAINS MARKETING GP INC.
 	 
	 	 	its General Partner 	 
	 	 	 
	 	By:  	
 	 
	 	 	Name:  	Al Swanson 	 
	 	 	Title:  	Senior Vice President and 
Chief
Financial Officer 	 
	 
	 	PLAINS MIDSTREAM GP LLC

 	 
	 	By:  	PLAINS MARKETING, L.P.
 	 
	 	 	its Sole Member 	 
	 	 	 
	 	By:  	      PLAINS MARKETING GP INC.
 	 
	 	 	its General Partner 	 
	 	 	 
	 	By:  	
 	 
	 	 	Name:  	Al Swanson 	 
	 	 	Title:  	Senior Vice President and 
Chief
Financial Officer 	 
	 
	 	PLAINS LPG SERVICES, L.P.

 	 
	 	By:  	PLAINS LPG SERVICES GP LLC
 	 
	 	 	its General Partner 	 
	 	 	 
	 	By:  	     PLAINS MARKETING, L.P.
 	 
	 	 	its Sole Member 	 
	 	 	 
	 	By:  	     PLAINS MARKETING GP INC.
 	 
	 	 	its General Partner 	 
	 	 	 
	 	By:  	
 	 
	 	 	Name:  	Al Swanson 	 
	 	 	Title:  	Senior Vice President and 
Chief
Financial Officer 	 
	 

Signature Page to Nineteenth Supplemental Indenture

4 of 8

 

	 	 	 	 	 
	 	PLAINS PRODUCTS TERMINALS LLC

 	 
	 	By:  	PLAINS MARKETING, L.P.
 	 
	 	 	its Sole Member 	 
	 	 	 
	 	By:  	      PLAINS MARKETING GP INC.
 	 
	 	 	its General Partner 	 
	 	 	 
	 	By:  	
 	 
	 	 	Name:  	Al Swanson 	 
	 	 	Title:  	Senior Vice President and 
Chief
Financial Officer 	 
	 
	 	RANCHO LPG HOLDINGS LLC

 	 
	 	By:  	PLAINS LPG SERVICES, L.P.
 	 
	 	 	its Sole Member 	 
	 	 	 
	 	By:  	     PLAINS LPG SERVICES GP LLC
 	 
	 	 	its General Partner 	 
	 	 	 
	 	By:  	     PLAINS MARKETING, L.P.
 	 
	 	 	its Sole Member 	 
	 	 	 
	 	By:  	     PLAINS MARKETING GP INC.
 	 
	 	 	its General Partner 	 
	 	 	 
	 	By:  	
 	 
	 	 	Name:  	Al Swanson 	 
	 	 	Title:  	Senior Vice President and 
Chief
Financial Officer 	 
	 

Signature Page to Nineteenth Supplemental Indenture

5 of 8

 

	 	 	 	 	 
	 	LONE STAR TRUCKING, LLC

 	 
	 	By:  	PLAINS LPG SERVICES, L.P.
 	 
	 	 	its Sole Member 	 
	 	 	 
	 	By:  	     PLAINS LPG SERVICES GP LLC
 	 
	 	 	its General Partner 	 
	 	 	 
	 	By:  	     PLAINS MARKETING, L.P.
 	 
	 	 	its Sole Member 	 
	 	 	 
	 	By:  	     PLAINS MARKETING GP INC.
 	 
	 	 	its General Partner 	 
	 	 	 
	 	By:  	
 	 
	 	 	Name:  	Al Swanson 	 
	 	 	Title:  	Senior Vice President and 
Chief
Financial Officer 	 
	 
	 	PACIFIC ENERGY GROUP LLC

 	 
	 	By:  	 	 
	 	 	Name:  	Al Swanson 	 
	 	 	Title:  	Senior Vice President and

Chief Financial Officer 	 
	 
	 	PACIFIC L.A. MARINE TERMINAL LLC

 	 
	 	By:  	PACIFIC ENERGY GROUP LLC
 	 
	 	 	its Sole Member 	 
	 	 	 
	 	By:  	
 	 
	 	 	Name:  	Al Swanson 	 
	 	 	Title:  	Senior Vice President and 
Chief
Financial Officer 	 
	 

Signature Page to Nineteenth Supplemental Indenture

6 of 8

 

	 	 	 	 	 
	 	ROCKY MOUNTAIN PIPELINE SYSTEM LLC

 	 
	 	By:  	PACIFIC ENERGY GROUP LLC
 	 
	 	 	its Sole Member 	 
	 	 	 
	 	By:  	
 	 
	 	 	Name:  	Al Swanson 	 
	 	 	Title:  	Senior Vice President and 
Chief
Financial Officer 	 
	 
	 	PLAINS MIDSTREAM CANADA ULC

 	 
	 	By:  	 	 
	 	 	Name:  	Al Swanson 	 
	 	 	Title:  	Vice President — Finance 	 
	 
	 	AURORA PIPELINE COMPANY LTD.

 	 
	 	By:  	 	 
	 	 	Name:  	Al Swanson 	 
	 	 	Title:  	Vice President — Finance 	 
	 
	 	PMC (NOVA SCOTIA) COMPANY

 	 
	 	By:  	 	 
	 	 	Name:  	Al Swanson 	 
	 	 	Title:  	Vice President — Finance 	 
	 

Signature Page to Nineteenth Supplemental Indenture

7 of 8

 

	 	 	 	 	 
	 	TRUSTEE:

U.S. BANK NATIONAL ASSOCIATION,

as Trustee

 	 
	 	By:  	 	 
	 	 	Name:  	Steven Finklea 	 
	 	 	Title:  	Vice President 	 
	 

Signature Page to Nineteenth Supplemental Indenture

8 of 8

 

EXHIBIT A

(Form of Face of Note)

			
	 	 	 
	CUSIP 72650RAY8

ISIN US72650RAY80
	 	No. __

$__________

PLAINS ALL AMERICAN PIPELINE, L.P.

PAA FINANCE CORP.

5.00% Senior Notes due 2021

Plains All American Pipeline, L.P., a Delaware limited partnership, and PAA Finance Corp., a
Delaware corporation, jointly and severally promise to pay to __________, or registered assigns,
the principal sum of _______________ Dollars [or such greater or lesser amount as may be endorsed
on the Schedule attached hereto]1 on February 1, 2021.

Interest Payment Dates: February 1 and August 1

Record Dates: January 15 and July 15

	 	 	 	 	 
	 	PLAINS ALL AMERICAN PIPELINE, L.P.

 	 
	 	By:  	PAA GP LLC, its General Partner
 	 
	 	By:  	            Plains AAP, L.P., its Sole Member
 	 
	 	By:  	                                            Plains All American GP LLC, its General Partner
 	 
	 	 	 
	 	By:  	
 	 
	 	 	Name:  	 	 
	 	 	Title:  	 	 
	 
	 	PAA FINANCE CORP.

 	 
	 	By:  	 	 
	 	 	Name:  	 	 
	 	 	Title:  	 	 
	 

	 	 	 	 	 
	TRUSTEE’S CERTIFICATE OF

AUTHENTICATION

This is one of the Debt Securities of the series designated therein referred to in the
within-mentioned Indenture.

U.S. BANK NATIONAL ASSOCIATION,

as Trustee

 
	By:  	 	 	 
	 	Authorized Signatory 

	 	 
	Dated: 	 
	 

 

			
	1	 	To be included only if the Note is issued in
global form.

A-1

 

(Form of Back of Note)

5.00% Senior Notes due 2021

[THIS GLOBAL SECURITY IS HELD BY OR ON BEHALF OF THE DEPOSITARY (AS DEFINED IN THE INDENTURE
GOVERNING THIS NOTE) IN CUSTODY FOR THE BENEFIT OF THE BENEFICIAL OWNERS HEREOF, AND IS NOT
TRANSFERABLE TO ANY PERSON UNDER ANY CIRCUMSTANCES EXCEPT THAT (A) THE TRUSTEE MAY MAKE SUCH
NOTATIONS HEREON AS MAY BE REQUIRED PURSUANT TO SECTION 2.08 OF THE ORIGINAL INDENTURE, (B) THIS
GLOBAL SECURITY MAY BE EXCHANGED IN WHOLE BUT NOT IN PART PURSUANT TO SECTION 2.15 OF THE ORIGINAL
INDENTURE, (C) THIS GLOBAL SECURITY MAY BE DELIVERED TO THE TRUSTEE FOR CANCELLATION PURSUANT TO
SECTION 2.10 OF THE ORIGINAL INDENTURE AND (D) THIS GLOBAL SECURITY MAY BE TRANSFERRED TO A
SUCCESSOR DEPOSITARY OR ITS NOMINEE WITH THE PRIOR WRITTEN CONSENT OF THE ISSUERS.]2

          Capitalized terms used herein shall have the meanings assigned to them in the Indenture
referred to below unless otherwise indicated.

          1. Interest. Plains All American Pipeline, L.P., a Delaware limited partnership (the
“Partnership”), and PAA Finance Corp., a Delaware corporation (“PAA Finance” and, together with the
Partnership, the “Issuers”), jointly and severally promise to pay interest on the principal amount
of this Note at 5.00% per annum from January 14, 2011 until maturity. The Issuers shall pay
interest semi-annually on February 1 and August 1 of each such year, or if any such day is not a
Business Day, on the next succeeding Business Day (each an “Interest Payment Date”). Interest on
the Notes shall accrue from the most recent date to which interest has been paid or, if no interest
has been paid, from the date of issuance. The first Interest Payment Date shall be August 1, 2011.
The Issuers shall pay interest (including post-petition interest in any proceeding under any
Bankruptcy Law) on overdue principal and premium, if any, from time to time on demand at a rate
that is 1% per annum in excess of the rate then in effect; and they shall pay interest (including
post-petition interest in any proceeding under any Bankruptcy Law) on overdue installments of
interest (without regard to any applicable grace periods) from time to time on demand at the same
rate to the extent lawful. Interest shall be computed on the basis of a 360-day year of twelve
30-day months.

          2. Method of Payment. The Issuers shall pay interest on the Notes (except defaulted
interest) to the Persons who are registered Holders of Notes at the close of business on the
January 15 or July 15 next preceding the Interest Payment Date, even if such Notes are canceled
after such record date and on or before such Interest Payment Date, except as provided in Section
2.17 of the Original Indenture with respect to defaulted interest, and the Issuers shall pay
principal (and premium, if any) of the Notes upon surrender thereof to the Trustee or a paying
agent on or after the Stated Maturity thereof. The Notes shall be payable as to principal,

 

			
	2	 	To be included only if the Note is issued in
global form.

A-2

 

premium, if any, and interest at the office or agency of the Trustee maintained for such purpose
within or without The City and State of New York, or, at the option of the Issuers, payment of
interest may be made by check mailed to the Holders at their addresses set forth in the register of
Holders, and provided that payment by wire transfer of immediately available funds shall be
required with respect to principal of and interest and premium, if any, on, each Global Security
and all other Notes the Holders of which shall have provided wire transfer instructions to the
Issuers or the paying agent on or prior to the applicable record date. Such payment shall be in
such coin or currency of the United States of America as at the time of payment is legal tender for
payment of public and private debts.

          3. Paying Agent and Registrar. Initially, U.S. Bank National Association, the Trustee
under the Indenture, shall act as paying agent and Registrar. The Issuers may change any paying
agent or Registrar without notice to any Holder. The Issuers or any of their Subsidiaries may act
in any such capacity.

          4. Indenture. The Issuers issued the Notes under an Indenture dated as of September
25, 2002 (the “Original Indenture”), as supplemented by the Nineteenth Supplemental Indenture dated
as of January 14, 2011 (the “Supplemental Indenture” and, together with the Original Indenture, the
“Indenture”) among the Issuers and the Trustee and, with respect to the Supplemental Indenture, the
subsidiary guarantors signatory thereto (the “Subsidiary Guarantors”). The terms of the Notes
include those stated in the Indenture and those made part of the Indenture by reference to the
Trust Indenture Act of 1939, as amended (15 U.S. Code §§ 77aaa-77bbbb). The Notes are subject to
all such terms, and Holders are referred to the Indenture and such Act for a statement of such
terms. To the extent any provision of this Note conflicts with the express provisions of the
Indenture, the provisions of the Indenture shall govern and be controlling. The Notes are joint
and several obligations of the Issuers initially in aggregate principal amount of $600 million.
The Issuers may issue an unlimited aggregate principal amount of Additional Notes under the
Indenture. Any such Additional Notes that are actually issued shall be treated as issued and
outstanding Notes (and as the same series (with identical terms other than with respect to the
issue date, the date of first payment of interest, if applicable, and the payment of interest
accruing prior to the issue date) as the initial Notes) for all purposes of the Indenture,
including waivers, amendments, redemptions and offers to purchase. To secure the due and punctual
payment of the principal and interest on the Notes and all other amounts payable by the Issuers
under the Indenture and the Notes when and as the same shall be due and payable, whether at
maturity, by acceleration or otherwise, according to the terms of the Notes and the Indenture, the
Subsidiary Guarantors have unconditionally guaranteed the Note Obligations under the Indenture and
the Notes on a senior basis pursuant to the terms of the Indenture.

          5. Optional Redemption.

          (a) At their option at any time prior to maturity, the Issuers may choose to redeem
all or any portion of the Notes at once or from time to time.

          (b) To redeem the Notes before a date that is 90 days prior to maturity, the Issuers must pay
a redemption price equal to the greater of (i) 100% of the principal amount of the Notes to be
redeemed, and (ii) as determined by the Quotation Agent (as defined below), the

A-3

 

sum of the present values of the remaining scheduled payments of principal and interest on the
Notes to be redeemed (not including any portion of those payments of interest accrued as of the
date of redemption) discounted to the date of redemption on a semi-annual basis (assuming a 360-day
year consisting of twelve 30-day months) at the Adjusted Treasury Rate (as defined below) plus 25
basis points, plus, in either case, accrued and unpaid interest to the date of redemption (subject
to the right of Holders on the relevant record date to receive interest due on the relevant
interest payment date).

          (c) To redeem the Notes on or after a date that is 90 days prior to maturity, the Issuers must
pay a redemption price equal to 100% of the principal amount of the Notes to be redeemed plus
accrued and unpaid interest to the date of redemption (subject to the right of Holders on the
relevant record date to receive interest due on the relevant interest payment date).

          For purposes of determining any redemption price, the following definitions shall apply:

          “Adjusted Treasury Rate” means, with respect to any date of redemption, the rate per annum
equal to the semi-annual equivalent yield to maturity of the Comparable Treasury Issue, assuming a
price for the Comparable Treasury Issue (expressed as a percentage of its principal amount) equal
to the Comparable Treasury Price for the date of redemption.

          “Comparable Treasury Issue” means the United States Treasury security selected by the
Quotation Agent as having a maturity comparable to the remaining term of the Notes to be redeemed
that would be utilized, at the time of selection and in accordance with customary financial
practice, in pricing new issues of corporate debt securities of comparable maturity to the
remaining term of the Notes.

          “Comparable Treasury Price” means, with respect to any date of redemption, (a) the average of
the Reference Treasury Dealer Quotations for the date of redemption, after excluding the highest
and lowest Reference Treasury Dealer Quotations, or (b) if the Trustee obtains fewer than four
Reference Treasury Dealer Quotations, the average of all such Reference Treasury Dealer Quotations.

          “Quotation Agent” means a Primary Treasury Dealer (as defined below) appointed by the Issuers.

          “Reference Treasury Dealer” means each of (i) J.P. Morgan Securities LLC, a Primary Treasury
Dealer (as defined below) selected by SunTrust Robinson Humphrey, Inc., and a Primary Treasury
Dealer (as defined below) selected by Wells Fargo Securities, LLC, and each of their successors;
provided, however, that if any of the foregoing shall cease to be a primary U.S. government
securities dealer in the United States (a “Primary Treasury Dealer”), the Issuers shall substitute
another Primary Treasury Dealer; and (ii) one other dealer selected by the Issuers that is a
Primary Treasury Dealer.

          “Reference Treasury Dealer Quotations” means, with respect to each Reference Treasury Dealer
and any date of redemption, the average, as determined by the Trustee, of the bid
and asked prices for the Comparable Treasury Issue (expressed in each case as a percentage

A-4

 

of its principal amount) quoted in writing to the Trustee by that Reference Treasury Dealer at 5:00
p.m., New York City time, on the third business day preceding that date of redemption.

          6. Notice of Redemption. Notice of redemption shall be mailed at least 30 days but
not more than 60 days before the redemption date to each Holder whose Notes are to be redeemed at
its registered address. Notes in denominations larger than $2,000 may be redeemed in part but only
in whole multiples of $1,000, unless all of the Notes held by a Holder are to be redeemed. Unless
the Issuers default in payment of the redemption price, on and after the redemption date interest
ceases to accrue on Notes or portions thereof called for redemption.

          7. Denominations, Transfer, Exchange. The Notes are in registered form without
coupons in minimum denominations of $2,000 and integral multiples of $1,000. The transfer of Notes
may be registered and Notes may be exchanged as provided in the Indenture. The Registrar and the
Trustee may require a Holder, among other things, to furnish appropriate endorsements and transfer
documents and the Issuers may require a Holder to pay any taxes or other governmental charges
required by law or permitted by the Indenture. The Issuers need not exchange or register the
transfer of any Note or portion of a Note selected for redemption or repurchase, except for the
unredeemed or unrepurchased portion of any Note being redeemed or repurchased in part. Also, the
Issuers need not exchange or register the transfer of any Notes for a period of 15 days before a
selection of Notes to be redeemed or repurchased or during the period between a record date and the
corresponding Interest Payment Date.

          8. Persons Deemed Owners. The registered Holder of a Note shall be treated as its
owner for all purposes.

          9. Amendment, Supplement and Waiver. Subject to certain exceptions, the Indenture or
the Notes may be amended or supplemented with the consent of the Holders of a majority in aggregate
principal amount of the then Outstanding Notes, and any existing default or compliance with any
provision of the Indenture or the Notes may be waived with the consent of the Holders of a majority
in aggregate principal amount of the then Outstanding Notes. Without the consent of any Holder of
a Note, the Indenture or the Notes may be amended or supplemented for any of the purposes set forth
in Section 9.01 of the Original Indenture (as amended by the Supplemental Indenture), including to
cure any ambiguity, defect or inconsistency, to provide for the assumption of an Issuer’s
obligations to Holders of the Notes in case of a merger or consolidation of such Issuer or sale of
all or substantially all of such Issuer’s assets, to add or release Subsidiary Guarantors (or their
successors) pursuant to the terms of the Indenture, to make any change that would provide any
additional rights or benefits to the Holders of the Notes or that does not adversely affect the
legal rights under the Indenture of any Holder of the Notes, to comply with the requirements of the
Commission to permit the qualification of the Indenture under the Trust Indenture Act, to evidence
or provide for the acceptance of appointment under the Indenture of a successor Trustee, to add any
additional Events of Default, to secure the Notes or the Guarantees or to establish the form or
terms of any other series of Debt Securities.

          10. Defaults and Remedies. Events of Default with respect to the Notes include: (i)
default for 60 days in the payment when due of interest on the Notes; (ii) default in payment
when due of principal of or premium, if any, on the Notes at maturity, upon redemption or

A-5

 

otherwise, (iii) failure by an Issuer or any Subsidiary Guarantor for 90 days after notice to
comply with any of the other agreements in the Indenture (provided that notice need not be
given, and an Event of Default shall occur, 90 days after any breach of the provisions of Section
6.01 of the Supplemental Indenture); (iv) default under any mortgage, indenture or instrument under
which there may be issued or by which there may be secured or evidenced any Debt of an Issuer or
any of the Partnership’s Subsidiaries (or the payment of which is guaranteed by the Partnership or
any of its Subsidiaries), whether such Debt or guarantee now exists or is created after the Issue
Date, if that default (a) is caused by a failure to pay principal of or premium, if any, or
interest on such Debt prior to the expiration of the grace period provided in such Debt (a “Payment
Default”) or (b) results in the acceleration of the maturity of such Debt to a date prior to its
original stated maturity, and, in each case described in clause (a) or (b), the principal amount of
any such Debt, together with the principal amount of any other such Debt under which there has been
a Payment Default or the maturity of which has been so accelerated, aggregates $25.0 million or
more, subject to the proviso set forth in Section 7.01(a)(iv) of the Supplemental Indenture; (v)
except as permitted by the Indenture, any Guarantee shall cease for any reason to be in full force
and effect (except as otherwise provided in the Indenture) or is declared null and void in a
judicial proceeding or any Subsidiary Guarantor, or any Person acting on behalf of any Subsidiary
Guarantor, shall deny or disaffirm its obligations under the Indenture or its Guarantee and (vi)
certain events of bankruptcy or insolvency with respect to an Issuer or any of the Subsidiary
Guarantors. If any Event of Default occurs and is continuing, the Trustee or the Holders of at
least 25% in aggregate principal amount of the then Outstanding Notes may declare all the Notes to
be due and payable. Notwithstanding the foregoing, in the case of an Event of Default arising from
certain events of bankruptcy or insolvency involving an Issuer, but not any Subsidiary Guarantor,
all Outstanding Notes shall become due and payable without further action or notice. Holders may
not enforce the Indenture or the Notes except as provided in the Indenture. Subject to certain
limitations, Holders of a majority in aggregate principal amount of the then Outstanding Notes may
direct the Trustee in its exercise of any trust or power. If and so long as the board of
directors, an executive committee of the board of directors or trust committee of Responsible
Officers of the Trustee in good faith so determines, the Trustee may withhold from Holders of the
Notes notice of any continuing Default (except a Default relating to the payment of principal,
premium, if any, or interest) if it determines that withholding notice is in their interests. The
Holders of a majority in aggregate principal amount of the Notes then Outstanding by notice to the
Trustee may on behalf of the Holders of all of the Notes waive any past Default or Event of Default
and its consequences under the Indenture except a continuing Default or Event of Default in the
payment of interest on, the principal of, or premium, if any, on the Notes or any other Default
specified in Section 6.06 of the Original Indenture. The Issuers and the Subsidiary Guarantors are
required to deliver to the Trustee annually a statement regarding compliance with the Indenture,
and the Issuers are required upon becoming aware of any Default or Event of Default, to deliver to
the Trustee a statement specifying such Default or Event of Default.

          11. Trustee Dealings with Issuers. The Trustee, in its individual or any other
capacity, may make loans to, accept deposits from, and perform services for the Issuers or their
Affiliates, and may otherwise deal with the Issuers or their Affiliates, as if it were not the
Trustee.

A-6

 

          12. No Recourse Against Others. The General Partner and its directors, officers,
employees and members (in their capacities as such) shall not have any liability for any
obligations of the Issuers under the Notes. In addition, the Managing General Partner and its
directors, officers, employees and members shall not have any liability for any obligations of the
Issuers under the Notes. Each Holder of Notes by accepting a Note waives and releases all such
liability. The waiver and release are part of the consideration for issuance of the Notes.

          13. Authentication. This Note shall not be valid until authenticated by the manual
signature of the Trustee or an authenticating agent.

          14. Abbreviations. Customary abbreviations may be used in the name of a Holder or an
assignee, such as: TEN COM (= tenants in common), TEN ENT (= tenants by the entireties), JT TEN (=
joint tenants with right of survivorship and not as tenants in common), CUST (= Custodian), and
U/G/M/A (= Uniform Gifts to Minors Act).

          15. CUSIP and ISIN Numbers. Pursuant to a recommendation promulgated by the Committee
on Uniform Security Identification Procedures, the Issuers have caused CUSIP and corresponding ISIN
numbers to be printed on the Notes, and the Trustee may use CUSIP and corresponding ISIN numbers in
notices of redemption as a convenience to Holders. No representation is made as to the accuracy of
such numbers either as printed on the Notes or as contained in any notice of redemption and
reliance may be placed only on the other identification numbers placed thereon.

          The Issuers shall furnish to any Holder upon written request and without charge a copy of the
Indenture. Requests may be made to:

Plains All American Pipeline, L.P.

333 Clay Street, Suite 1600

Houston, Texas 77002

Attention: Investor Relations

A-7

 

Assignment Form

To assign this Note, fill in the form below: (I) or (we) assign and transfer this Note to

 

(Insert assignee’s soc. sec. or tax I.D. no.)

 

 

 

 

(Print or type assignee’s name, address and zip code)

and irrevocably appoint                                                                                                    
                                                                                                   
agent to transfer this Note on the books of the Issuers. The agent may substitute another to act
for him.

 

Date: _____________

	 	 	 	 	 
	 	 	 
	 	Your Signature:  	
 
	 	 	(Sign exactly as your name appears on the face of this Note)
	 	 	 	 
	 

	 	 	 	 	 
	 	 	 
	Signature Guarantee:  	
 
	 	(Signature must be guaranteed by a financial institution that is a member
of the Securities Transfer Agent Medallion Program (“STAMP”), the Stock
Exchange Medallion Program (“SEMP”), the New York Stock Exchange, Inc.
Medallion Signature Program (“MSP”) or such other signature guarantee
program as may be determined by the Registrar in addition to, or in
substitution for, STAMP, SEMP or MSP, all in accordance with the Securities
Exchange Act of 1934, as amended.) 

A-8

 

	 	 	 	 	 

SCHEDULE OF INCREASES OR DECREASES IN THE GLOBAL NOTE3

          The original principal amount of this Global Note is $                    . The following increases or decreases
in this Global Note have been made:

	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	Principal	 	 
	 	 	Amount of	 	Amount of	 	Amount of	 	Signature of
	 	 	decrease in	 	increase in	 	this Global Note	 	authorized
	 	 	Principal Amount	 	Principal Amount	 	following such	 	signatory of
	Date of	 	of	 	of	 	decrease	 	Trustee or Note
	Exchange	 	this Global Note	 	this Global Note	 	(or increase)	 	Custodian
	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 

 

			
	3	 	To be included only if the Note is issued in
global form.

A-9

 

EXHIBIT B

FORM OF SUPPLEMENTAL INDENTURE

          SUPPLEMENTAL INDENTURE (this “Supplemental Indenture”), dated as of ___________________, among
Plains All American Pipeline, L.P., a Delaware limited partnership (the “Partnership”), PAA Finance
Corp., a Delaware corporation (“PAA Finance” and, together with the Partnership, the “Issuers”),
________________________ (the “Subsidiary Guarantor”), a direct or indirect subsidiary of Plains
All American Pipeline, L.P. (or its successor), a Delaware limited partnership (the “Partnership”),
and U.S. Bank National Association, as trustee under the indenture referred to below (the
“Trustee”).

WITNESSETH

          WHEREAS, the Issuers have heretofore executed and delivered to the Trustee an indenture (the
“Original Indenture”), dated as of September 25, 2002, as supplemented by the Nineteenth
Supplemental Indenture (the “Nineteenth Supplemental Indenture” and, together with the Original
Indenture, the “Indenture”) dated as of January 14, 2011, among the Issuers, the Subsidiary
Guarantors and the Trustee, providing for the issuance of the Issuers’ 5.00% Senior Notes due 2021
(the “Notes”);

          WHEREAS, Section 5.05 of the Nineteenth Supplemental Indenture provides that under certain
circumstances the Partnership is required to cause the Subsidiary Guarantor to execute and deliver
to the Trustee a supplemental indenture pursuant to which the Subsidiary Guarantor shall
unconditionally guarantee all of the Issuers’ obligations under the Notes pursuant to a Guarantee
on the terms and conditions set forth herein; and

          WHEREAS, pursuant to Section 9.01 of the Original Indenture, the Issuers and the Trustee are
authorized to execute and deliver this Supplemental Indenture;

          NOW THEREFORE, in consideration of the foregoing and for other good and valuable
consideration, the receipt of which is hereby acknowledged, the Issuers, the Subsidiary Guarantor
and the Trustee mutually covenant and agree for the equal and ratable benefit of the holders of the
Notes as follows:

          1. Definitions.

          (a) Capitalized terms used herein without definition shall have the meanings assigned to them
in the Indenture.

          (b) For all purposes of this Supplemental Indenture, except as otherwise herein expressly
provided or unless the context otherwise requires: (i) the terms and expressions used herein shall
have the same meanings as corresponding terms and expressions used in the Indenture; and (ii) the
words “herein,” “hereof” and “hereby” and other words of similar import

B-1

 

used in this Supplemental Indenture refer to this Supplemental Indenture as a whole and not to
any particular section hereof.

          2. Agreement to Guarantee. The Subsidiary Guarantor hereby agrees, jointly and
severally with all other Subsidiary Guarantors under the Indenture, to guarantee the Issuers’
obligations under the Notes on the terms and subject to the conditions set forth in Article IX of
the Nineteenth Supplemental Indenture and to be bound by all other applicable provisions of the
Indenture. Except as expressly amended hereby, the Indenture is in all respects ratified and
confirmed and all the terms, conditions and provisions thereof shall remain in full force and
effect. This Supplemental Indenture shall form a part of the Indenture for all purposes, and every
holder of Notes heretofore or hereafter authenticated and delivered shall be bound hereby.

          3. GOVERNING LAW. THIS SUPPLEMENTAL INDENTURE SHALL BE DEEMED TO BE A NEW YORK
CONTRACT, AND FOR ALL PURPOSES SHALL BE CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW
YORK.

          4. Trustee Makes No Representation. The Trustee makes no representation as to the
validity or sufficiency of this Supplemental Indenture.

          5. Counterparts. The parties may sign any number of copies of this Supplemental
Indenture. Each signed copy shall be an original, but all of them together represent the same
agreement.

          6. Effect of Headings. The Section headings herein are for convenience only and shall
not effect the construction thereof.

B-2

 

          IN WITNESS WHEREOF, the parties hereto have caused this Supplemental Indenture to be duly
executed as of the date first above written.

	 	 	 	 	 
	 	PLAINS ALL AMERICAN PIPELINE, L.P.

 	 
	 	By:  	PAA GP LLC, its General Partner
 	 
	 	 	 
	 	By:  	                                              Plains AAP, L.P., its Sole Member
 	 
	 	 	 
	 	By:  	                                              Plains All American GP LLC, its General Partner
 	 
	 	 	 	 
	 	 	 
	 	By:  	
 	 
	 	 	Name:  	 	 
	 	 	Title:  	 	 
	 
	 	PAA FINANCE CORP.

 	 
	 	By:  	 	 
	 	 	Name:  	 	 
	 	 	Title:  	 	 
	 
	 	[SUBSIDIARY GUARANTOR],

 	 
	 	By:  	 	 
	 	 	Name:  	 	 
	 	 	Title:  	 	 
	 
	 	U.S. BANK NATIONAL ASSOCIATION, as Trustee

 	 
	 	By:  	 	 
	 	 	Name:  	 	 
	 	 	Title:  	 	 
	 

B-3

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